ATLANTA — Georgia’s top economist Robert Buschman is warning state lawmakers that persistent inflation and sluggish job growth will continue to challenge the state’s economy this year, putting pressure on consumer confidence.
“Reluctance by businesses to hire suggests fewer opportunities to change jobs for better pay, and that those between jobs will remain unemployed, or entering the workforce will remain unemployed for longer, dragging on consumer confidence,” Buschman said.
Buschman says inflation remains a key concern, especially as wages have not kept pace with rising costs.
“Incomes have not really kept up for the average worker, so consumer sentiment is weak,” he said, adding that “anything that pushes inflation higher again is likely to make matters worse for the average consumer.”
Despite those challenges, Buschman does not believe Georgia is headed for a recession. Instead, he says the state could experience a period of so-called “stagflation,” when inflation and unemployment rise while economic growth slows.
Buschman notes that one bright spot is the state’s unemployment rate, which remains low. The most recent data puts Georgia’s unemployment rate at 3.5%, well below the national rate of about 4.5%.
Governor Brian Kemp says the state is prepared to handle economic headwinds, pointing to years of cautious budgeting.
“We’ve been cautiously budgeting since we came out of the pandemic because nobody really knew what this was going to look like,” Kemp said.
Kemp added that Georgia is ready to face future challenges.
“We’re ready for any storm that may come our way,” he said, later adding, “we’re definitely prepared to weather whatever comes.”
Buschman says while low unemployment is encouraging, slow job growth and ongoing inflation are likely to remain a drag on consumer confidence across Georgia as the state moves further into 2026.
WSB Radio’s Jonathan O’Brien contributed to this story.