ATLANTA (Jan. 27, 2010) – The Senate and House Economic Development committees gathered at the State Capitol for their first joint meeting of the session to hear from several economic experts on how to grow jobs in Georgia. Co-chaired by state Sen. Chip Pearson (R-Dawsonville) and Rep. Ron Stephens (R-Savannah), the committees were joined by the Special Committee on Small Business Development and Job Creation, a new standing House committee devoted to examining proposals to promote small business and job creation.
“Job creation is at the forefront of repairing our local and national economy. Today’s hearing marks a crucial first-step to creating an atmosphere that encourages job growth in Georgia,” said Sen. Pearson. “A recurring recommendation from all of our speakers was to reduce regulation on businesses in order to jumpstart the employment sector. I firmly believe that taxation, litigation and regulation are the three biggest killers of jobs.”
The committees heard from experts on the economy, housing, and Georgia’s ports. Economist Robert Pretcher, author of the 2002 book Conquer the Crash that predicted the current debt crisis, noted that despite Congress passing the biggest spending bill in history last February, jobs continue to crumble. “This is graphic evidence that the stimulus package is part of the problem,” he said.
He warned that despite popular predictions of expected growth in the middle of the year, recovery will be much slower, especially if stocks begin to decline again. Pretcher encouraged the committees to consider removing impediments to job creation, such as repealing minimum wage laws, reducing business regulations and encouraging Georgia congressmen to introduce a bill that repeals the 16th Amendment, which allows Congress to levy an income tax without apportioning it among the states. While he admitted this is an ambitious idea, Pretcher stressed the importance of ensuring that the money that is made in Georgia stays in Georgia.
Roger Tutterow, professor of economics at Mercer University, highlighted the effect that the downturn in construction has had on jobs. Georgia’s heavy exposure in the construction and real estate sector is a large part of why the state ranks among the top ten states in job loss. Since the state’s construction peak in March 2007, Georgia has shed nearly 60,000 jobs, or about 26 percent of its employment in that industry. In order to move forward, Tutterow encouraged lawmakers to consider broad-based tax reform that is comprehensive, rather than focused on just one sector.
Because of the housing industry’s significant impact on Georgia jobs, the committees got an overall look at metro Atlanta’s housing market from Eugene James, director of Metrostudy’s Atlanta region which is a leading housing market intelligence firm. According to James, housing starts are down 86 percent from 2007. Over the past three years, Georgia has virtually stopped building homes. This has helped absorb the vast inventory that pervaded the state when the housing market began to slump. However, the number of vacant lots continues to be a problem throughout the Atlanta market, which will continue to put pressure on banks, according to James. He also noted that in the best case scenario, the value of lots has declined 50 percent across the metro area.
Georgia’s ports are another key area for job and economic growth. Michael Toma, professor of economics at Atlantic Armstrong State University, stressed the importance of deepening the Savannah harbor in order to retain Georgia’s competitive edge, as well as transportation projects that allow cargo to move quickly and efficiently through the area. Losing that market share could set the state back another five years.
Throughout the Legislative Session, the Senate and House Economic Development committees will continue discussing ways the legislature can encourage growth in Georgia’s job sector.
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Sen. Chip Pearson serves as chairman of the Economic Development Committee. He represents the 51st Senate District which includes Dawson, Fannin, Gilmer, Lumpkin, Pickens, and Union counties and portions of Forsyth and White
PRESS RELEASE
For Immediate Release:
January 27, 2010
For Information Contact:
Raegan Weber, Director
Kallarin Richards, Senior Communications Specialist Director
kallarin.richards@senate.ga.gov
404.656.0028