An economic forecaster predicts the country will go over the so-called “fiscal cliff” in January. Rajeev Dhawan, director of Georgia State University’s Economic Forecasting Center doesn't believe the lame duck Congress will be able to agree on needed budget cuts . He also predicts Georgia will only see sluggish growth in 2013.
He says exports, which had been a bright star in the state’s economy, are slowing due to a global downturn.
“Exports last year in Georgia 20 percent or so. This year so far year to date, 2.3. Canada, we are exporting less. Germany, negative. Look at Korea, minus 13. China goes from 33 down to 17.”Dhawan says
That will hurt job growth in Georgia. He says the state will have to look for domestic sources for economic growth in the coming year.
He says the job market in Georgia has varied widely since the recession.
“I was surprised that recovery in the corporate sector was now back to about the peak before. Education and health always grows. Local government is actually lower than before. Construction of course, keeps on going down. Manufacturing in the last two years has actually grown. And that’s because of our cheaper energy, export-oriented, and we have the land. We can do more manufacturing.” he says
Dhawan expects 2013 job growth around 1 percent, mostly because of employers afraid to hire until Congress resolves how to address the federal budget crisis.
Congress has until January 2nd to prevent massive automatic federal budget cuts. Georgia U.S. Senator Saxby Chambliss said recently 38-thousand jobs would be lost in Georgia on military bases and the businesses supporting them if that happens.
Dhawan predicts Congress will reach a bipartisan agreement in the fall of 2013. He says then they will finally come up with a clear down payment towards deficit reduction.