Georgia ports recorded their busiest month ever in August, much to the surprise of state officials who have been bracing for a significant drop in business since the coronavirus pandemic began.
Wednesday’s unexpectedly glowing report came after July’s prediction from Georgia Port Authority officials that the pandemic’s thrashing of the global economy would likely mean a decline in shipments through much of this year.
Instead, workers in Savannah moved 1% more cargo — mostly imports — than they did during their previous best month ever, which was last August, said Griff Lynch, executive director of the Georgia Ports Authority.
“We were completely surprised,” Lynch said. “We underestimated the importance of Savannah in the supply chain. And this happened when there are so many ports that are down double-digits."
Some of that decline in cargo elsewhere has been because of Georgia’s rise, he said. “We are the fastest-growing large port on the East Coast."
Pushing that growth is e-commerce, which has been steadily transforming retail for years. A decade ago, e-commerce took about one of every $8 in consumer spending, but some recent data shows e-commerce accounting for one of every $3.
Now, with the pandemic, online retail is surging to new levels, while the number of jobs in hospitality, travel, restaurants and many in-person service jobs continue to lag.
The state likely will end this year with 279,800 fewer jobs than at the start of 2020, said Rajeev Dhawan, director of the Economic Forecasting Center at Georgia State University. Dhawan issued his quarterly economic forecast on Wednesday, predicting that Georgia will add 57,900 jobs next year and 163,900 jobs in 2022.
For comparison, in 2018, the state added 81,700 jobs and, in 2019, 69,300 jobs.
This year’s swell in online shopping benefits Georgia more than most states, Lynch said. “E-commerce is in a growth phase, and we are becoming a hub for e-commerce.”
What makes Georgia a hub is its location — along with the seaports, Hartsfield-Jackson International Airport, the highway system and a huge rail-to-truck center in northwest Georgia. While the pandemic cost the state hundreds of thousands of jobs, there has been growth in warehouses, distribution and transportation for companies that exploit online sales to deliver goods to Georgia consumers.
Among the signs of e-commerce expansion in Georgia are Amazon’s recent announcement of plans to hire 4,000 workers and the decision by DHL eCommerce Solutions to open a distribution center in Mableton that will hire 225 people this year.
Growth in e-commerce means more jobs — fewer in stores, but more in the ports and along the supply chain that leads to the customer’s door, Dhawan said. "E-commerce is a way to buy stuff, but that stuff still has to come into the country physically.”
The Georgia ports, a major component in the state’s $620 billion-a-year economy, accounts for hundreds of thousands of jobs in trucking, warehouses, logistics and delivery. The state has nearly a half-million jobs in transportation and moving goods, according to the Bureau of Labor Statistics.
But growth in e-commerce simply cannot make up for the losses elsewhere, said Dhawan. It could take until 2022 before the state is fully recovered.
“The whole forecast depends on when the vaccine comes and gets distributed,” he said. “That’s when the real recovery begins."
E-commerce wasn’t the only factor leading to port officials’ August surprise.
Some stores that hesitated to order goods in the early days of the pandemic are now replenishing their inventories, Lynch said.
And August is traditionally peak season for shipments to retailers that are stocking up for the holiday shopping season. Though many retailers remain uncertain about what the coming season will bring, they can’t risk being without goods to sell.
“The peak season seems to have been stronger than what was expected,” Lynch said.
Port officials say business shouldn’t drop off anytime soon, according to shipping reports from around the world.
Because it can take weeks for cargo vessels to reach Georgia from the other side of the world, port officials keep tabs on shipments “on the water” to project business for coming weeks. And right now, there are roughly as many shipments en route to Georgia as there were leading up to August’s results, Lynch said.
“I can tell you now that September will be a strong month for us,” he said. “And I think October looks good.”
Busiest U.S. ports, 2019
1. Los Angeles
2. Newark/New York
3. Long Beach
4. Savannah
5. Houston
6. Seattle
7. Tacoma
8. Norfolk
9. Charleston
10. Oakland
Source: Logistics Management
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Cargo through Savannah as compared to a year earlier
January: -12.2%
February: 16.8%
March: -18.2%
April: -7.3%
May: -9.7%
June: -6.5%
July: -6.8%
August: .9%
Source: Georgia Ports Authority
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Jobs forecast for Georgia:
2020: -279,800
2021: 57,900
2022: 163,900
Source: Economic Forecasting Center at Georgia State University
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