Economist: Recovery is possible

Photo by Jason Braverman

Photo by Jason Braverman

DULUTH -- Economist Donald Ratajczak answered the questions bankers, builders and business leaders had on their minds as soon as he began an annual address to the Council for Quality Growth.

"Question: is recovery on the horizon? The answer is yes," he said to applause. Then he added, "I'm not telling you where the horizon is."

The speech's opening was echoed in the normally dismal forecaster's somewhat upbeat address. Ratajczak said economic indicators have hit the floor, but the coming year is not necessarily going to bring new prosperity.

"No, you guys aren't going to be back where you were three years ago, but at least you are starting to climb out of the hole," he said to the leaders of the Atlanta region's construction industry, giving hope that homebuilding would begin again, as home prices have begun to stabilize.

Ratajczak, a founder of the Economic Forecasting Center in the J. Mack Robinson College of Business at Georgia State University, was more bleak about the commercial development industry.

Because so many jobs have been lost, there is no need for more office space, he said.

Small businesses are also struggling to get capital from banks who have clamped down and shrunk credit.

For Dave Heydinger of the Mathias Corporation, the report was another grim reminder that his business could struggle in the new year.

"He said what we expected, but it's hard to keep hearing it over and over again," Heydinger said. "We have to find creative ways to succeed because so much of our economy and jobs (in the Gwinnett area) depend on (construction). It's not the government that's going to fix this. It's us small businesses."

In terms of retail, Ratajczak said Christmas sales are going to be up a small percentage, which is better than the downward trend others were expecting. And he found hope in a November jobs report that showed that people with jobs are getting bigger pay checks.

He said people are still nervous about hiring, but he said much of the panic of a year ago has gone away.

"The ship is starting to turn," he said. "2011 is going to be our true recovery, but we'll start to lay the foundation in 2010."