Economic growth in the Savannah metro area slowed to 0.03% in the first quarter of 2026, a crawl by any definition, according to the Q1 2026 Coastal Empire Economic Monitor release from Georgia Southern University. The quarterly index, compiled by economist Michael Toma, Georgia Southern’s Fuller E. Callaway Professor of Economics, lands a region long anchored by port traffic and a new Hyundai plant into the territory of an effective stall.
Underneath the headline, the same report carries a quieter story. Annual revisions to Georgia employment data rewrote 2025 from a 1% job loss to a 1% job gain, lifted by upward revisions of +10% in manufacturing and nearly 30% in logistics. Those sectors did more work than the initial readings had captured, and they remain the load-bearing beams of the regional economy even as the overall index barely moves.
Growth Stalls at 0.03% in Q1 2026
The Savannah metro’s business index grew 0.03% in the opening quarter of 2026, a number that is technically positive and functionally flat. The Monitor uses two regular measurements, a coincident index that tracks current activity and a leading index designed to forecast six to nine months ahead. “The indicators of current economic activity were mixed,” Toma said in the release, “with increases in hotel room revenue and port activity, while retail trade and airport boardings dipped.”
The split shows up across every major sector the Monitor tracks. Hotel and motel tax revenue climbed 9% on the quarter and 7% versus a year earlier. Retail sales fell 2.5% from the previous quarter and 2.7% from a year ago. Airport boardings dropped 1% on the quarter though they remain up 4% on the year. Service-sector employers added 600 jobs; goods-producing employers lost 300. The unemployment rate remains at 3%, the average since fall 2021.
The slowdown extends a longer arc already visible in the leading indicators. The Monitor’s forecasting index fell 0.7% in Q1, the fourth consecutive quarterly decline. The index is designed to give a “look around the corner” six to nine months into the future, and a fourth straight drop is a sustained warning. Toma’s expectation for the rest of 2026: “generally weaker-than-average regional economic conditions,” with annual employment growth running somewhere between 0.5% and 1%, well below the 1.7% year-over-year pace recorded in Q1. Trade policy uncertainty and elevated energy prices add sustained headwinds, the same report notes.
- 0.03%: Savannah metro business index growth in Q1 2026
- 216,000: total regional jobs, +1.7% versus a year earlier
- $30.38: hourly private-sector wage in inflation-adjusted dollars, +5.6% year over year
- $275,400: average single-family permit value, +24% on the quarter
- +11.4%: jump in initial unemployment claims, to 657 from 590
The Hyundai Plant Wind-Down Works Through Construction
The goods-producing side of the Savannah economy shed 300 jobs in Q1 and settled at 35,100 workers. The Monitor ties the decline to the winding down of Hyundai Motor Group Metaplant America in Bryan County.
Construction accounts for most of the damage, with minor losses of about 200 workers per quarter accumulating into a total of roughly 900 workers lost since the end of 2024, the Monitor reports. Total construction employment now stands at 9,500. Manufacturing payrolls dropped 100 jobs on the quarter, settling at 25,600. That is a small quarterly wobble inside a much larger story.
The Monitor now reports manufacturing employment as roughly 2,500 workers higher than the data through mid-2025 had shown. Toma called the revision “staggeringly high” and tied it to the size of the emerging automobile manufacturing sector. The same dynamic shows up in logistics, where annual revisions lifted reported headcount by nearly 30%.
The Hyundai plant sits at the center of the regional rebalancing. The Monitor describes a Savannah economy now anchored by what it calls two “overlays”: port logistics and Hyundai-driven manufacturing. The construction headcount that built those overlays is now stepping back as the plant transitions to full operation. Construction employment at 9,500 will not return to the levels that ran while the Bryan County site was being built. For the Q1 numbers, the practical effect is that the goods-producing line of the regional tally keeps subtracting jobs even as manufacturing, in revised terms, climbs.
| Sector | Q1 2026 jobs change | Total employment |
|---|---|---|
| Service sector | +600 | – |
| Goods-producing | -300 | 35,100 |
| Manufacturing | -100 | 25,600 |
| Construction | About -200 per quarter (cumulatively ~900 since end-2024) | 9,500 |
| Logistics | +100 | 24,200 |
| Leisure and hospitality | -100 | 27,600 |
| Retail trade | -100 | – |
The Port Pulls Back From Last Year’s Slump
Shipping containers handled at the Port of Savannah rose 1.7% in Q1 after seasonal adjustment, the Monitor reports, reversing a 6% loss recorded in the closing quarter of 2025. “Port activity appears to be clearing the period of instability experienced in 2025,” the report reads. The regional logistics sector added 100 workers in Q1, lifting logistics employment to 24,200.
The benchmark revisions show how much the survey-based initial readings had missed. Logistics employment now stands at 24,200, up from a reported 18,900 in mid-2025, an upward catch-up of about 5,300 jobs. The same dynamic shows up in manufacturing, where annual revisions lifted reported headcount by 10%. The Monitor’s revised 2025 trajectory moved from a 1% employment loss to a 1% employment gain across the year.
The mechanism is mechanical. Initial monthly employment numbers lean on a voluntary employer survey that catches most firms but can miss rapidly growing employers. The annual benchmark, by contrast, is built on the de facto universe of unemployment-insurance filings and tends to capture headcount the initial survey left out. At a port adding logistics workers and at a Hyundai plant hiring fast, the gap between the two methods has been unusually wide.
K-Shaped Spending Is Splitting the Region
Toma describes the broader U.S. economy as K-shaped, a pattern in which top earners are faring well while bottom earners are struggling. Savannah is showing that split inside its own quarterly numbers. The K-shape shows up across tourism, retail, and labor data in the same release.
The clearest read comes inside tourism. Hotel revenue is up on the aggregate, with hotel and motel taxes climbing 9% on the quarter and 7% from a year ago. Inside that aggregate, vacancies are running higher in the budget tier of the market while luxury downtown hotels are charging higher rates and posting stronger growth. Airport boardings, which skew toward leisure visitors, dropped 1% on the quarter though they remain up 4% on the year.
We’ve got less spending that is recycling in our local economy that is consistent with a K-shaped economy at the national level. We see that playing out here in Savannah as well.
Retail tells the other side of the same letter. Retail sales fell 2.5% on the quarter and 2.7% from a year earlier, and retail trade shed 100 jobs in Q1.
The labor data also split. Initial claims for unemployment insurance jumped 11.4% to 657 from 590 in the previous quarter, though year-over-year claims are down 1.2%. The headline unemployment rate held at 3%, where it has averaged since fall 2021. The split is real but the headline figure does not move; the moving part is who is unemployed. For households at the lower end of the K, the same quarter brought the highest initial-claim count in some time and the steepest retail drop. For households at the upper end, hotel taxes climbed and luxury occupancy held.
Fewer Permits, but Each One Carries a Higher Value
The Monitor’s housing-market indicators also tell two stories at once. The seasonally adjusted monthly issuance of single-family construction permits dropped 29% in Q1, falling to 524 from 739. At the same time, the average value of a single-family building permit jumped 24%, rising to $275,400 from $221,700.
The year-over-year comparison sharpens the gap. Permit value is up 15% versus Q1 2025 while permit count is down 35%. The local housing market is producing fewer homes and pricing the ones it produces higher. The dynamic is consistent with builders stepping back from spec construction as costs rise and as the bulk of regional construction activity, the Hyundai Metaplant, runs out of new ground to break.
| Metric | Q1 2026 | Previous quarter | Year over year |
|---|---|---|---|
| Single-family permits (monthly avg, SA) | 524 | 739 | -35% |
| Average permit value | $275,400 | $221,700 | +15% |
Permit value excludes land and builder profit, the Monitor notes, so the gap between $275,400 in average permit value and the eventual sale price of a finished home is wider than the figure alone suggests. The 35% drop in permit count points to fewer total homes breaking ground this year than last.
Wages Climb as the Workweek Lengthens
Hourly wages in the private sector, measured in inflation-adjusted dollars, climbed 1.9% in Q1, moving from $29.83 to $30.38 per hour. The Monitor frames the 5.6% year-over-year wage gain as “meaningful growth in consumer purchasing power.” For workers whose hours and wages are both moving up, the take-home math is better than it was a year ago.
The workweek itself is lengthening. Average private-sector hours worked rose 1.1% in Q1 to 31.5 hours per week, a 3.5% improvement over a year ago and the fifth consecutive quarter of lengthening. The post-pandemic slide in workweek length “appears to have ended in late 2024,” per the Monitor, and the typical week is now about 5%, or roughly 90 minutes, longer than it was at the recent low. Both pieces together paint a tightening labor market for workers already on the job, even if the headline employment number barely budges.
The local labor market is also showing its first warning light in this report. Monthly initial claims for unemployment insurance jumped 11.4% to 657 from 590 in the previous quarter, a notable rise even though year-over-year claims are down 1.2% and the headline 3% unemployment rate, which has averaged at that level since fall 2021, has not moved.
The Forecast Calls for a Below-Average Rest of 2026
The Monitor’s leading economic index fell 0.7% in Q1, the fourth consecutive quarterly decline. The index is designed to look six to nine months out, so a fourth-straight drop is a sustained warning. The coincident index grew 0.03% and the leading index fell 0.7%; both numbers came out of the same report.
Toma’s projection for the rest of the year is modest. Annual employment growth for the Savannah region should land somewhere between 0.5% and 1%, below the 1.7% year-over-year rate recorded in Q1. The full-year employment number for 2026 will land below the 1.7% pace of Q1, in his framing. Even at the upper end of the projection, the year prints as below-average for the region.
We’re below average in terms of economic momentum and health at this point, but things would be worse if we did not see that manufacturing growth and growth in the logistics sector employment.
Toma offered the framing himself in remarks carried by the Savannah Morning News. “Elevated uncertainty in the U.S. economy, continued trade policy uncertainty, and elevated energy prices will continue to put pressure on business growth and the household budget, creating economic headwinds for the national and regional economy,” he said. Those same conditions translated directly into the weaker hotel and retail numbers that defined Q1.
For Savannah, the port-and-plant triangle keeps the regional floor higher than the headline index would suggest. The Monitor’s framing is concrete: without the manufacturing and logistics growth now visible in the revisions, the year’s numbers would be worse. Those two sectors are the buffer between a below-average year and a contraction. The Hyundai plant and the Port of Savannah now sit at the structural center of the regional economy, with each carrying more weight through the rest of 2026 as the construction and tourism contributions slow.
Frequently Asked Questions
What is the Coastal Empire Economic Monitor?
The Coastal Empire Economic Monitor is a quarterly snapshot of the Savannah Metropolitan Statistical Area economy, produced by Georgia Southern University’s Center for Business Analytics and Economic Research and authored by economist Michael Toma. It combines a coincident index, which tracks current activity, with a leading index designed to forecast regional activity six to nine months ahead. The Monitor has been published quarterly since at least 2020 and is available on request from the Center.
Which counties make up the Savannah metro area?
The Savannah Metropolitan Statistical Area includes Bryan, Chatham, and Effingham counties in Georgia. The Monitor’s 216,000-job regional employment figure is drawn from that three-county footprint, which is also where the Port of Savannah and the Hyundai Motor Group Metaplant America are located.
Why is construction employment dropping in Savannah?
The Monitor ties the regional construction decline to the winding down of the Hyundai Motor Group Metaplant America in Bryan County, the electric-vehicle plant whose build-out has been the largest single construction project in the region in recent years. Construction employment has shed about 200 workers per quarter since the end of 2024, with cumulative losses of around 900 workers.
How is the Hyundai plant affecting manufacturing jobs in Savannah?
Initial readings through mid-2025 had undercounted manufacturing employment, according to the Monitor. The annual benchmark revision lifted manufacturing employment by 10%, including roughly 2,500 workers added on top of the previously reported figure. Manufacturing now sits at 25,600 jobs in the region.
What does the forecast say about the rest of 2026?
Toma projects annual employment growth of 0.5% to 1% for the Savannah region in 2026, below the 1.7% year-over-year gain recorded in Q1. The Monitor’s leading economic index has declined for four consecutive quarters, and the report expects generally weaker-than-average regional economic conditions through the remainder of 2026.
