Georgia, whose population of more than 11 million makes it the eighth-largest state, is booming like it never did before Joe Biden became the 46th president.
Not since such data initially was collected in 1990 has there been a three-year period when growth in the Peach State's manufacturing payrolls came close to matching the 11.9 percent increase in jobs since 2021 or its rate of employment gains compared with the US overall, according to data compiled by Bloomberg. There’s no denying that Georgia’s labour market is superior to that of Biden's predecessor, Donald Trump, whose four years in the White House coincided with Georgia manufacturing employment declining faster than the rest of the nation (a dubious trend of every presidency in the new century except Biden's).
The truism among historians that presidents can't take credit for the economy is belied by growing evidence from independent analysts showing the Biden administration’s policies are an unrivaled jobs juggernaut dating back to World War II -- in no small part because of legislation enacted since he was inaugurated on Jan 20, 2021.
Whether it’s the American Rescue Plan Act of 2021 that kicked-started the record labour market recovery or the Infrastructure Investment and Jobs Act that is spurring road and bridge building or the Chips and Science Act that is subsidising the manufacturing of semiconductors inside the US or the Inflation Reduction Act that includes financing for clean energy projects that promise to create manufacturing jobs, Biden has been able to say without exaggeration: “We've created close to 800,000 manufacturing jobs since I've taken office.”
That's no idle boast, according to PolitiFact, a non-profit that rates the accuracy of claims by elected officials. The same arbiters of truth find “the nation's manufacturing rebound is the strongest at this point after a recession” since 1951. The organisation posted on its website in December that it analysed federal government data for manufacturing as far back as the eve of World War II, focusing on how many people were employed in manufacturing at the beginning of a recession and how many people were employed in the field 45 months later, which was the same time that had passed since Biden took office. The conclusion:
“Presidents Dwight Eisenhower, John F Kennedy, Jimmy Carter, Ronald Reagan, Bill Clinton, George W Bush, and Barack Obama were all in office 45 months after a recession began and they did not see manufacturing jobs bounce back even to their initial levels, much less add manufacturing jobs on net. Reagan, Bush, and Obama all saw declines of 9.9 percent to 15.7 percent.”
A Financial Times analysis a year ago identified “75 large-scale manufacturing announcements in the US” since the Chips Act and Inflation Reduction Act, showing American and foreign companies committing “roughly $204 billion” while “promising to create at least 82,000 jobs” that almost doubled “the capital spending commitments in the same sector in 2021 and nearly 20 times the amount in 2019.” “More than 75 percent of all investment is headed to Republican-held Congressional districts, where it will create 58,000 jobs,” the FT wrote.
Georgia, whose Republican Governor Brian Kemp opposed the Inflation Reduction Act while taking credit for the state's job boom, is among the biggest direct and indirect beneficiaries of Biden policies promoting infrastructure, clean energy, semiconductors and biotechnology. A record 600,000 new business applications were filed in 2021 and 2022 and companies announced plans to spend more than $31 billion across the state since Biden took office.
The investments include South Korea's Hanwha Solutions Corp's $2.5 billion to expand solar panel and manufacturing in Dalton and build a factory in Catersville, creating an estimated 2,500 jobs as the largest single solar investment in US history, and Hyundai Motor Co's $5.5 billion commitment to construct an electric vehicle assembly and battery plant near the port of Savannah. The Korean automaker said it expects to create 8,100 jobs with the twin plants and start production in 2025 with an annual capacity of 300,000 vehicles. Then there’s FREYR Battery Inc's $1.7 billion clean battery manufacturing plant in Coweta County, which would allow the Norwegian company to create 720 jobs.
All this is showing up in the Federal Reserve Bank of Philadelphia's US Coincident Indexes, which track each state based on nonfarm payroll employment, average hours worked in manufacturing by production workers, the unemployment rate and wage and salary disbursements deflated by the Consumer Price Index. By these metrics, Georgia has strengthened 12.7 percent under Biden through January, compared with 11.2 percent at the same point in the Trump administration. What’s more, when many pundits are declaring Biden’s candidacy doomed due to rising consumer prices, the Atlanta-Sandy Springs-Roswell metropolitan area is one of the few in country to see its rate of inflation fall back to pre-pandemic levels, or 3.3 percent, according to Bureau of Labor statistics data.
Georgia's economic outlook is especially relevant because Americans are persistently reminded by the media that so much depends on the seven so-called swing states of Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania and Wisconsin that will determine whether Biden or Trump is re-elected. The same polls rarely mention that the 45th president is a twice-impeached election denier facing four criminal indictments in four different cities including one for election interference in Atlanta — after already being found liable for sexual assault, instigating the Jan 6 insurrection at the US Capitol and presiding over the greatest loss of life from the Covid-19 pandemic of any country when he occupied the Oval Office. On the campaign trail, he now appears to encourage violence against Biden along with judges handling his various court cases and their families.
The public opinion poll-driven media narrative of American unhappiness in these key states rarely mentions the job market, which is the most robust since the 1960s. Georgia's unemployment rate of 3.1 percent is 0.8 percentage point lower than the US rate and declined most recently for the first time in more than a year, demonstrating the resilience of a job market that has helped make Georgia among the 10 happiest states.
Not a single Congressional Republican voted for the Inflation Reduction Act, which passed along party lines in the Senate and prompted 33 specific Georgia investments for clean energy projects totaling $14.6 billion in counties with below-average weekly wages and college graduation rates. Georgia's two Democratic Senators, Raphael Warnock and Jon Ossoff - who were elected in 2021 - happily championed the legislation and were probably decisive in bringing the spoils back to their home state. Will Georgians remember come November?
Matthew A. Winkler, editor in chief emeritus of Bloomberg News, writes about markets. Views are personal and do not represent the stand of this publication.
Credit: Bloomberg
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
