News Summary

Savannah’s economy has been experiencing a slowdown, with economic growth weakening in the first half of the year. Employment levels dropped significantly, while consumer spending revealed weaknesses in retail sales and tourism. Port activity and construction permits also faced declines, indicating challenges ahead. Despite some wage increases, the outlook suggests continued slower growth for Savannah, necessitating adaptive strategies to navigate the changing economic landscape.

Savannah

The economy of Savannah is experiencing signs of cooling as reported by the Georgia Southern University’s Q1 and Q2 Economic Monitors for 2025. The analysis indicates that economic growth has weakened, first taking a dip in the first quarter and further losing momentum in the second quarter, causing it to fall below long-term trends.

Factors contributing to this economic slowdown include evolving U.S. international trade policy and its effects on local activity. The Savannah business index showed a modest increase of 0.3% annualized in Q1, but faced a decline of 0.6% annualized in Q2, highlighting the shifting dynamics in business conditions.

During the first half of 2025, total employment in Savannah dropped by 500 jobs in both quarters, resulting in a total net job loss of 1,000, with the employment level ending Q2 at 201,100 jobs. While the service sector saw some gains in leisure, hospitality, education, health, and local government jobs, these positive developments were countered by losses in the professional and business services, as well as transportation sectors. A particular concern is the logistics sector, which saw a total job loss of 800 over the two quarters.

Consumer spending has also shown signs of weakness. Retail sales declined by 2.2% in Q1 and by 0.4% in Q2, although sales remain 2.1% higher than the same period last year. Touristic metrics have also witnessed a decline; hotel and motel tax collections dropped by 0.5% in Q1, along with a 5.7% decrease in airport boardings. In Q2, tourism performance was mixed, with an increase in airport boardings, auto rentals, and alcoholic beverage tax collections, while hotel/motel tax collections fell by 4.5%.

Port activity, a pivotal component of Savannah’s economy, saw a drop in shipping container units as well, falling by 1.2% in Q1 and by 0.6% in Q2. Despite these drops, container volume remains 9% higher compared to 2024, indicating potential resilience in logistics despite job losses.

The construction sector is facing its challenges too. The issuance of single-family building permits saw a slight increase of 1% in Q1 but experienced a significant decline of 12.6% in Q2, with a corresponding drop in permit values, down by 5.3% and 3.5% in those quarters respectively, marking a substantial 9% below figures from a year ago.

In terms of wages, private-sector compensation showed adjustments for inflation, with wages rising by 3.5% to $28.76 per hour in Q1 and by an additional 2.9% to $29.61 per hour in Q2. The unemployment rate saw fluctuations as well, increasing from 2.9% in Q4 2024 to 3.2% in Q1 2025, before returning to 2.9% in Q2. Initial unemployment insurance claims rose by 3.7% in Q1 but dropped by 8.2% in Q2, demonstrating some volatility in the labor market.

Looking ahead, projections indicate continued slower growth for Savannah’s economy, with expectations that conditions will remain below long-term trends throughout 2025. These trends reflect uncertainties within the broader U.S. economy and gradual tariff-related price increases impacting local business and consumer behavior. The evolving economic landscape in Savannah underscores the need for adaptive local strategies that focus on workforce adjustments and trade adaptations to navigate the changing environment.

Deeper Dive: News & Info About This Topic

• Grice Connect: Georgia Southern’s Economic Monitor
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• Google Search: Savannah Georgia economy
• WTOC: Savannah State’s Economic Impact
• Google Scholar: Savannah Georgia economic development
• Times Free Press: International Paper Closure
• Encyclopedia Britannica: Savannah
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• Google News: Savannah Georgia economic news