By the Numbers: Region’s economy humming as stars aligned, before bank merger
By David Pendered
Metro Atlanta’s economic engine is humming right along, according to a new report that factors in the estimated 6,500 jobs lost in the region in the past year but not the unknown fallout from the announced merger of SunTrust and BB&T.
CBRE’s overview of metro Atlanta’s economy couldn’t be more clear:
- “Atlanta is firing on all economic cylinders. From company relocation and expansion activity, its place as a distribution hub for the Southeast region, expanding ports and airports, to robust job growth and construction activity, Atlanta is a top destination amongst investors, businesses and job seekers.”
CBRE, a global real estate firm, said Monday that it’s not speaking about the bank merger announced Feb. 7. In what may have been a prescient statement, CBRE’s report didn’t single out banking as a key regional industry in a sector that includes, “technology, logistics and professional services.”
BB&T agreed to buy SunTrust in an all-stock deal announced three weeks after SunTrust Chairman and CEO William Rogers, Jr. delivered the following update on the bank’s posture. Rogers’ Jan. 18 statement was associated with SunTrust’s fourth-quarter, 2018 report to the Securities and Exchange Commission:
- “Our performance this quarter provided a good conclusion to a strong year for SunTrust. In 2018, we continued to deliver on the commitments we have made to our owners…. Going into 2019, our diverse business mix, ongoing investments in growth and technology, and consistent underwriting discipline, give me confidence in our ability to continue to deliver long-term value for our owners.”
CBRE’s view of the region’s economy is of a more bullish in nature than the Jan. 16 Beige Book released by Federal Reserve. The Atlanta Fed observed in that report that contacts in the Southeast were “largely positive,” and also “cited increased levels of uncertainty going into 2019, to include concerns over politics and trade.”
On the other hand, CBRE’s report on the economy is in keeping with the latest report from Trepp, which tracks loans on commercial properties. Trepp observed that the performance in metro Atlanta’s commercial mortgage backed securities, “exceeds all annual statistics for the variables mentioned since 2010.”
In terms of layoffs, the Georgia Department of Labor posts information provided by employers under the federal Worker Adjustment and Retraining Notification Act. The number of jobs lost in metro Atlanta in 2018 and so far this year, estimated at 6,500, is similar to that of 2018 and 2014. Job losses dipped to an estimated 5,500 in 2015 and 4,500 in 2016.
These four reports demonstrate the acumen of a twist on the old saw about the half-full glass – a correct answer simply doesn’t exist:
- An optimist sees the glass as half full;
- A pessimist sees the glass as half empty;
- The mechanical engineer wonders why the glass was made that size.
All this said, CBRE’s report provides a “By the Numbers” look at Atlanta’s relative position in the Southeast. Then it dissects some of those numbers to illustrate a generally upbeat outlook for metro Atlanta. Some examples include:
- 1st in population – 5.9 million;
- 1st in 10-year job growth – 311,000;
- 2nd in annual net migration – 53,700;
- 2nd in percent with four-year degree – 38.1 percent.
- 17th in mean commute time – 32.3 minutes.
Here are some highlights from the report:
- “Corporate expansion and relocation to the Atlanta area has fueled job and population growth for the last several years, and the good news keeps coming. Recent expansions and job announcements include Inspire Brands, BlackRock, Salesforce, Starbucks and Pandora.”
- “Nationwide a shortage of suitable labor is impacting employers. Today there are more job openings than unemployed people, posing greater challenges to companies as they look to add and retain talent. But Atlanta is in a prime position to combat this trend, consistently ranking among the highest markets in terms of net migration and overall growth. Further, the trend is expected to remain for the foreseeable future.”
- “Atlanta’s market drivers are massive and diverse. Hartsfield Jackson International Airport, the world’s largest passenger airport, is in the midst of a $6 billion renovation and expansion. The Port of Savannah, which set a new record while processing 4.2 million TEU’s in fiscal year 2018, is also undergoing a $1 billion expansion.
- “Atlanta’s economy is diverse, with key industries consisting of technology, logistics and professional services. Construction is also a bright spot, as mobility enhancements such as the addition of commuter lanes along major interstates and the redesign of the I-285/GA Highway 400 interchange will prepare Atlanta for additional growth.”