ATLANTA — Georgia’s economy is expected to grow at a slower pace of 1.5% in 2026, mirroring the national economic trend.
However, UGA business researches said the state faces elevated risks of a recession due to slower growth and economic headwinds.
The University of Georgia Terry College of Business Interim Dean Santanu Chatterjee announced these projections at the Georgia Economic Outlook event held in Atlanta.
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The event, hosted by the UGA Selig Center for Economic Growth, has been providing economic forecasts for Georgia for 43 years.
“In 2026, Georgia’s economy will match the U.S. economy with respect to the pace of GDP and job growth,” Chatterjee said.
Georgia’s economy had previously been buoyed by near-record population growth and a business-friendly environment, but these factors are now slowing.
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The decline in the size of the labor force and uncertainty over trade policies are noted as factors that could weaken Georgia’s economic resilience against national headwinds.
Inflation is projected to peak at 3.5% in 2026 before retreating to 3% in 2027, prompting the Federal Reserve to consider easing monetary policy, according to UGA business researchers.
The Federal Reserve is expected to lower the federal funds rate to 2.75% from 4.5% at the beginning of 2025.
The unemployment rate is anticipated to average 4.1% in 2026, with concerns over a slowdown in new job creation.
Investment in artificial intelligence and data centers provides economic benefits but also creates uncertainty for future job creation.
The real estate market is expected to remain stagnant, with single-family home prices predicted to decrease in 2026. Homeowners are hesitant to sell due to low mortgage rates, contributing to a housing recession.
Chatterjee noted that while home prices will correct, it will not mirror the drastic declines seen during the Great Recession.
Despite slower growth, Georgia’s economy is resilient and diversified, with a skilled workforce and strong educational institutions, researchers said.
Chatterjee said he was optimistic about Georgia’s ability to recover economically, once national conditions improve.
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