Armstrong State University’s latest Coastal Empire Economic Monitor reports the Savannah-area economy continued to expand during the third quarter of 2014 and should experience sustained growth, at a more moderate pace, through the middle of 2015. 

The Economic Monitor, which analyzes data and identifies trends affecting the regional economy, reports across-the-board growth in key areas. During the third quarter, the economy was boosted by improvements in the labor market, port activity, tourism, consumer expectations and the housing market.

The growth in the coincident index continued the trend of significant growth in the Savannah metro economy. The forecasting index extended its pace for a second consecutive quarter. Both indices continue to signal healthy, continued economic growth in the Savannah area through the second quarter of 2015.  

“Our regional economy continues to move in the right direction as we put the Great Recession further and further behind us,” said Michael Toma, Fuller E. Callaway Professor of Economics and the Director of Armstrong’s Center for Regional Analysis. “We’ve seen significant improvements in housing and labor markets which bode well for 2015.”

In the housing market, building permits issued for single-family homes rapidly increased. The number of new residential homes permitted for construction increased to 442 from 356, posting a 24 percent quarterly increase and marking the strongest signal of activity in the residential housing market since Fall 2007, just before the nationwide housing market slump.    

Seasonally adjusted initial claims for unemployment insurance fell 11 percent to 774 claims per month during the third quarter. Significantly, the number of new filings dropped below 700 claims for the first time since late 2007, before the Great Recession took hold. 

Additional highlights from the latest Economic Monitor include: 

· The Coastal Empire leading economic index continued to rise at a more moderate and sustainable pace set at mid-year. Improved consumer expectations along with continued healing in the labor and housing market supported the index.  

· The Coastal Empire leading economic index increased 0.8 percent (3.4 percent, annualized), rising to 141.0 from 139.9 (revised) in the previous quarter. The pace of increase roughly matches the more sustainable level set in the previous quarter. 

· The Coastal Empire coincident economic index increased 0.6 percent to 168.3. This is an annualized pace of 2.6 percent, extending the period of quality growth in Savannah’s economy to 15 months.  

· Seasonally adjusted employment in the three-county metro area increased 100 jobs to 164,500 during the quarter. Construction appears to have turned the corner, adding 200 jobs to climb to 5,500 workers. The service sector gained about 400 workers, while local government added 500 workers. 

· Inflation and seasonally adjusted hotel and motel room receipts increased about 1 percent during the quarter and are up 12 percent as compared to year-ago data. Airport boardings are 18 percent ahead of last year’s pace. Car rental sales taxes and alcoholic beverage sales taxes are up 6 and 16 percent, respectively, compared to previous year data. 

The Coastal Empire Economic Monitor presents quarterly economic trends and short-term economic forecasts for Savannah’s Metropolitan Statistical Area (MSA). The quarterly report measures the heartbeat of the local economy, based on the analysis of economic data from the U.S. Census Bureau, the U.S. Department of Labor’s Bureau of Labor Statistics, the City of Savannah, Georgia Power and the three counties in the MSA—Chatham, Bryan and Effingham. 

The report presents a short-term forecast of the region’s economic activity in the next six to nine months and is available free by email. To subscribe, email [email protected]. 

Armstrong’s Center for Regional Analysis, housed in the university’s economics department, meets the applied research needs of Savannah's business and community organizations. Areas of concentrated research include regional economic forecasting, economic impact analysis, economic development and business expansion, tourism development, survey-based research and specialty reports on topics of state, regional and local interest.