The State of Working Georgia 2006
Sep 8, 2006    Georgia Budget and Policy Institute   Guest Opinion

The State of Working Georgia 2006

By Sarah Beth Coffey, Deputy Director
Georgia Budget and Policy Institute
www.gbpi.org

When people talk about the economy, they often measure its health through business-oriented gauges, such as number of jobs, gross state product, number of business expansions, and other data. While those measures can provide some insight into the economy, they don't mean much if the benefits are not being felt by the workforce. For instance, if twenty new businesses move in yet the poverty rate rises simultaneously, are we experiencing a healthy economy? If profits and exports are up, and so is the number of uninsured workers, is our state doing better or worse?

To measure the health of our state and our economy, we must examine the lifeblood of Georgia’s economy – the workers. The Georgia Budget and Policy Institute's recent report titled The State of Working Georgia seeks to provide that other side of the economic picture – the vitality of Georgia's workforce. How are the workers, who help Georgia's economy thrive, faring? Are wages and benefits growing and unemployment declining? Is economic opportunity being shared widely, and are all demographics prospering equally? What was found was that overall, the state of working Georgia in 2005 did not reflect an improvement from 2004 and remained well below conditions prior to the 2001 recession.

In 2005, high wages grew, but wages in the middle and at the low end fell. While Georgia finally added enough new jobs to reach pre-recession employment levels, the unemployment rate spiked to its highest level since 1993 and exceeded the Southern rate for the first time in 25 years. Georgia's workforce approached national levels for the share of workers with a bachelor's degree or higher, but the share of workers without a high school degree increased as well (the first time since 1989 this group increased by a statistically significant amount).

Although many economic indicators showed a mixture of good and bad news, some of the most important economic measures for Georgia workers showed no improvement and declines. The two-year average of median household income was unchanged from 2003-2004 to 2004-2005 and remained $3,000 lower than in 2000-2001. Poverty increased to 14.4 percent in 2005. That is over 1.2 million Georgians living at or below the poverty level. Child poverty was even greater, with 20.2 percent of Georgia's children impoverished. Just as wages and incomes were stagnating, healthcare benefits declined. The percentage of Georgia residents receiving employer-based health insurance decreased. In addition, Georgia was one of only eight states to see a statistically significant increase in the uninsured population in 2004-2005 with over 1.6 million Georgians lacking health insurance.

While economic conditions were unimpressive across the board, certain groups were especially hard-hit. Similar to the nation, Georgia's African-American workers continued to have a significantly higher unemployment rate and lower median wage than white workers. With data published for the first time on Hispanic workers, we learned that Georgia's Hispanic workforce fared even worse in median wages, earning a full one-third less in median hourly wages than white workers. Poverty rates varied widely with 8.8 percent of whites, 20.0 percent of Hispanics, and 24.9 percent of African-Americans living in poverty in 2005. Education groups also had dramatically different experiences as workers with a high school degree had unemployment rates over two-and-a-half times higher than workers with a college degree.

While much of Georgia's workforce doldrums are a national phenomenon the state does have a role to play in improving the conditions of working Georgians. Georgia must develop economic development policies that stress high quality jobs and improvements in education, tax policies that give relief to low and moderate income Georgians, a welfare program that stresses moving Georgians out of poverty, a strong public health insurance program to assist working Georgians, and an increased minimum wage to assist those workers at the lowest rungs of the economic ladder.

We cannot claim economic success for Georgia until the lifeblood of our economy – our Georgia workforce – has recovered its economic well-being.

About GBPI
The Georgia Budget and Policy Institute (GBPI) is the state’s leading independent, nonprofit, non-partisan organization engaged in research and education on the fiscal and economic health of the state of Georgia.The Institute provides reliable and timely analyses of Georgia’s budget and tax policies and promotes greater state government fiscal accountability, improved services and an enhanced quality of life for all Georgians. www.gbpi.org

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