Georgia’s economy will grow in 2025, albeit at a slower pace than 2024, according to the University of Georgia’s Selig Center for Economic Growth. Despite the deceleration, the state’s economy is projected to outperform national growth rates, driven by resilient sectors like health care and housing.
Slower but Steady Economic Growth
The Selig Center forecasts a 2.4% growth in Georgia’s economy for 2025, down from 3.1% in 2024. By comparison, the U.S. economy is expected to grow by only 1.6%. Speaking at the kickoff event for the Georgia Economic Outlook series at the Georgia Aquarium, Terry College of Business Dean Ben Ayers emphasized that this slowdown is a controlled response to economic policies, not an unforeseen crisis.
Ayers highlighted that the Federal Reserve’s adjustments to monetary policy have played a significant role in moderating growth. “This slowdown will be gradual and short-lived,” he said, projecting that Georgia’s economy will pick up speed again in 2026.
Inflation Control and Employment Trends
One of the driving factors behind Georgia’s economic outlook is inflation management. After peaking at 8% in 2022, inflation dropped to 3% in 2024 and is expected to remain stable in 2025. This stability stems from the Federal Reserve’s policy adjustments, including interest rate cuts and an easing of credit restrictions.
The state’s unemployment rate will inch up from 3.7% to 4% in 2025, a level still below the national average of 4.3%. Ayers noted this uptick will result from slowed hiring rather than job losses. Importantly, this shift is expected to balance labor demand and help maintain inflation at manageable levels.
“This slight rise in unemployment isn’t a cause for alarm,” Ayers reassured. “It’s enough to keep inflation low without shaking consumer confidence.”
Housing and Health Care Drive Growth
Two key sectors—health care and housing—are set to lead Georgia’s growth in 2025. A growing population, especially among senior residents, will continue to fuel demand for health care services across the state. Meanwhile, demographic trends and a persistent housing shortage are pushing homebuilders to ramp up construction.
- Home construction is projected to increase by 9%, focusing on single-family homes.
- Home prices, which surged by 65% since the pandemic, are expected to stabilize in 2025.
- Slightly lower mortgage rates and favorable demographics are encouraging homebuyers and builders alike.
On the flip side, technological advancements and the rise of online retail are likely to shrink employment in retail and information sectors.
Georgia’s Economic Advantages
While the global and national economies face a slowdown, Georgia maintains a competitive edge. The state has been a magnet for industries and job creation in recent years, though the pace of new investments will slow in 2025. However, ongoing projects will ensure job growth in the near term.
Ayers pointed to Georgia’s unique strengths:
- Diverse Industries: A balanced mix of sectors ensures resilience during economic slowdowns.
- Strategic Location: World-class transportation and logistics infrastructure support growth.
- Cost Competitiveness: Low costs of living and doing business continue to attract companies.
These factors collectively position Georgia to outpace the national economy not only in 2025 but in subsequent years as well.
Key Statistics: A Snapshot of 2025 Predictions
| Indicator | Georgia 2025 Forecast | U.S. 2025 Forecast |
|---|---|---|
| GDP Growth | 2.4% | 1.6% |
| Job Growth | 1% | 0.6% |
| Unemployment Rate | 4% | 4.3% |
| Inflation Rate | 3% | 3% |
| Housing Construction | +9% | Not available |
The overall probability of a recession in Georgia is estimated at 25%, underscoring the state’s relative stability despite broader uncertainties.
For further insights into Georgia’s economic performance, the Selig Center’s detailed forecast is available online, and regional economic outlook events are scheduled throughout January. From Athens to Savannah, these programs will shed light on local economic conditions and opportunities.
