Job market to slow in 2025, but Georgia has key advantages, experts say

Experts are forecasting slower job growth in Georgia and nationally as well as fewer interest rate cuts in 2025 amid uncertainty over President Donald Trump’s tariff and fiscal policies, though some see potential positives from the administration’s approach.

Economic uncertainty is expected to slow job growth across the country this year, but there are some redeeming factors in Georgia’s economy, according to a report Thursday from the Economic Forecasting Center at Georgia State University.

Georgia will add 50,900 jobs this year, down from 57,700 in 2024, Rajeev Dhawan, director of the center, predicts.

Dhawan cited multiple job cut announcements in metro Atlanta in recent weeks that show weakness in the job market.

They include layoffs at CNN, closures of three Atlanta-area Macy’s locations, job cuts at the Atlanta-based Centers for Disease Control and Prevention and pullbacks of two major electric vehicle battery plant projects — Freyr Battery’s canceled $2.6 billion plant in Newnan and Aspen Aerogels' halted factory near the coast.

Credit: arvin.temkar@ajc.com

Credit: arvin.temkar@ajc.com

Key sectors that drive the middle class and their spending in Georgia — including corporate, information technology and business-to-business sectors — have lost nearly 9,000 jobs in the last 12 months and more than 31,000 jobs since the start of 2023, according to Dhawan.

In Georgia, one area of expansion is data center construction — though once the data centers are built and begin operations, they are not major job centers like office buildings, he noted.

Credit: Daniel Varnado

Credit: Daniel Varnado

Georgia’s film and TV industry could also see more productions moved to the state from Hollywood because of destruction caused by the Los Angeles wildfires.

Other areas of growth include the Savannah area, according to MarketNsight principal John Hunt, citing Hyundai’s new electric vehicle manufacturing factory opened last year.

But an issue on the horizon is that a trade war sparked by new tariffs announced by the Trump administration could affect tonnage moving through the Port of Savannah, according to Dhawan.

Trump slapped 10% tariffs on Chinese goods and China retaliated with its own levies. On Thursday, Trump said he would enact another 10% import tax on China.

Trump put on hold 25% tariffs on Canada and Mexico, but said this week those taxes will go into effect next week.

Credit: Courtesy of Georgia Ports Authority

Credit: Courtesy of Georgia Ports Authority

In metro Atlanta, the local economy is poised to take advantage of expanded use of automation in logistics through its emerging robotics sector, and to capitalize on the artificial intelligence boom through technology startups, he added.

But “overall growth will slow because of international and national factors,” Dhawan said.

Large firms are “gun shy” about hiring, he said.

“Right now, the undercurrent is that the large corporations have the mandate to do house cleanings in terms of employment headcount reduction,” Dhawan said.

Job cuts also affect the housing market, and “it’s going to be severe in some locations,” depending on the concentration of where CDC workers live, for example, according to Dhawan.

Credit: Miguel Martinez-Jimenez

Credit: Miguel Martinez-Jimenez

Cuts of federal workers could also impact labor figures, Roger Tutterow, economist and professor at Kennesaw State University, said Wednesday at an economic forecast breakfast held by regional banking giant Synovus.

“When that occurs, it could have a dampening effect nationwide on employment. So, be aware of the next several months and quarters that there is an increased risk that this employment data gets dirty because of the efforts of team DOGE,” Tutterow said, referring to the Elon Musk-led Department of Government Efficiency that is spearheading federal cost-cutting measures.

Tutterow added that he sees some positives for the economy because of the new administration’s efforts to “right size” government and decrease regulation, which could spur the energy sector and lead to more corporate mergers and acquisitions.

Still, there were nods at the breakfast meeting to economic uncertainties, including a big one hitting consumers at the grocery store and their favorite diner, Waffle House, which recently enacted a surcharge on eggs.

“I hope everyone notices there are eggs on your plate, so the bank is doing well,” Synovus President and CEO Kevin Blair quipped. “But in the spirit of this administration … we have to make it up. So, if you’re outside of Cobb County, just leave $1 on your table, because I’m imposing a tariff.”

Credit: Miguel Martinez-Jimenez

Credit: Miguel Martinez-Jimenez

Consumer confidence declined by 7 points in February, the largest monthly decline since August 2021, according to a consumer confidence index released by the Conference Board on Tuesday.

Inflation has hovered around 3% since mid-2023, above the Federal Reserve’s target rate of 2%, “but the last mile of the journey is always the hardest,” said Tutterow.

“We do expect one interest rate cut this year, possibly a second one late in the year,” he said, though he acknowledged the speculation that potential inflationary tariffs and the consumer price index staying above the Fed’s 2% goal could cause the central bank to raise rates.

“We have seen the Fed in the middle of a cutting cycle reverse it, take rates up about 25 years ago, but I don’t expect that this year,” he said.

But with those interest rate cuts, don’t expect mortgage rates to also fall this year, Tutterow cautioned. The Fed directly affects short-term interest rates, not long-term rates like mortgages, which likely won’t get down to 5% for some time.

“If you’re thinking about buying a home, just understand waiting a couple months is not going to get you a five flat mortgage,” Tutterow said.

Credit: Ziyu Julian Zhu/AJC

Credit: Ziyu Julian Zhu/AJC

There are bright spots on the horizon. Job market conditions in Georgia are expected to improve in 2026 and 2027, Dhawan’s forecast shows.

It’s still uncertain how tariffs may affect the economy.

“It’s only in 2026 when we have absorbed in all the machinations of the tariffs and everything, the job quality becomes better,” he said.

The Atlanta Journal-Constitution and Report for America are partnering to add more journalists to cover topics important to our community. Please help us fund this important work here.