Despite a massive correction in much of the globe’s stock exchanges, U.S. gross domestic product could continue to grow at a reasonable 2.0 percent, according to Rajeev Dhawan of the Economic Forecasting Center at Georgia State University’s J. Mack Robinson College of Business.

“The key factor is that companies, despite the jittery stock market and poor results in earnings last year, will keep hiring,” Dhawan wrote in his quarterly “Forecast of the Nation,” released today (Feb. 24). “If they pause, income gains will slow and fretful households will save even more, causing a slowdown.”

For the second time in six months, China’s attempt to manage the devaluation of its currency sent shockwaves through global equity markets. Dhawan believes some nervousness surrounding the markets is warranted, but he called the current situation an overreaction.

“The markets are reacting like a petulant child to the promised fix of a monetary stimulus overseas that is failing to materialize soon enough,” Dhawan said.

The dip in the stock market will have a negative effect on consumer wealth, but nothing like the bursting of the housing bubble in 2008. In fact, falling oil prices will offset most of this negative effect, leading consumers to much better cash flow to start 2016 than at the same point in 2015.

In 2015, consumers used savings from low gas prices for big-ticket items such as vehicles, which sold 17.3 million units last year. As a result, retailers are feeling the pinch of the now frugal American consumer.

“The United States accounts for 25 percent of the world’s consumption, Europe another 25 percent. Combined, this big engine is not firing on all cylinders for Chinese-made goods,” Dhawan said. “Thus, the Chinese slowdown occurred as a result of our own rational action to consume fewer items they produce.”

He expects that the Federal Reserve will examine investment indicators at their April meeting, and if they are stable, the forecaster expects a June rate hike. After that, rates will stay put until after November.

Regarding the election, Dhawan says two candidates in particular would have a substantial impact on the economy if elected.

“If Donald Trump or Bernie Sanders wins,” he said, “it will drastically change tax policy outlook for coming years. Neither of these candidates seems susceptible to lobbying and the shock to boardroom confidence will result in lower capital expenditure spending and a concomitant growth stall.”

Highlights from the Economic Forecasting Center’s National Report

•Real GDP grew at 2.4 percent in 2015, will expand at 2.2 percent in 2016, 2.5 percent in 2017 and 2.6 percent in 2018.

•Business investment will grow by 3.0 percent in 2016, rebound to 5.0 percent in 2017 and 4.9 percent in 2018. Jobs will grow by a monthly rate of 174,000 in 2016, 163,000 in 2017 and 137,000 in 2018.

•Housing starts will average 1.191 million units in 2016, rise to 1.255 in 2017 and 1.319 in 2018.

•The 10-year bond rate will rise to 2.5 percent by the end of 2016 and inch up to 3.1 percent in 2017.

Despite Global Headwinds, Georgia Maintains its Growth Drive

Fourth-quarter job gains in Georgia proved resilient in the face of global turmoil, and domestic demand will continue to buoy job growth in the Peach State, according to Rajeev Dhawan of the Economic Forecasting Center at Georgia State University’s J. Mack Robinson College of Business.

Dhawan pointed to 2015 growth in four key sectors in his quarterly “Forecast of Georgia and Atlanta,” released today (Feb. 24). “Despite global headwinds, healthy domestic consumption is advancing employment in sectors such as trade, hospitality, education and healthcare, and government.”

These domestically centered sectors, especially the education and healthcare sector and government, can expect growth but at a slightly slower pace than 2015.

Despite an exceptional fourth quarter in which Georgia added more jobs (48,400) than the previous nine months combined (47,900), the state added only 96,300 jobs for 2015, a steep drop from the 145,000 jobs added in 2014.

Job growth in manufacturing, a catalyst sector, was less than half than the 11,200 jobs added in 2014.

“This slowdown was expected as a high dollar pushed prices up for international purchases,” Dhawan wrote. “Despite the headwinds, this sector is expected to eke out about 3,000 jobs in 2016.”

However, strong domestic consumption is expected to boost manufacturing job growth in certain metropolitan statistical areas (MSAs) where goods are produced to be sold in the country. Columbus, whose auto parts suppliers benefit from their proximity to the Kia plant in Troup County, is expected to see job growth of 1.7 percent. Dalton, where manufacturers produce carpeting and other inputs for residential and commercial properties, is expected to see manufacturing job growth of 2.0 percent.

The falling price of oil is proving to be a tailwind for metro Atlanta, unlike other cities around the country.

“We never had shale oil to begin with, so we are avoiding the bust being felt in Houston,” Dhawan said. “In the Atlanta metro area, construction is going strong since investment that was likely earmarked for oil investment is making its way into commercial and hotel investment due to low oil prices.”

As a result, new office towers are being proposed across Metro Atlanta. Perimeter Mall and Sandy Springs are anticipating large mixed-use buildings. Hotels are being planned near the future Braves stadium in Cobb County, the airport and a convention center in Alpharetta.

Residential construction in Atlanta also is booming with a 12.5 percent increase in housing permits in 2015 and an expected increase of 5.3 percent in 2016. Dhawan said job creation in 2016 will support this permit growth.

“Through much of the forecast period,” he said, “global malaise will hinder job advancement, but expect domestic demand to give it all she’s got.”

Highlights from the Economic Forecasting Center’s Report for Georgia and Atlanta

•Georgia employment will gain 76,000 jobs (13,500 premium jobs) in calendar year 2016, 75,800 jobs (13,100 premium) in 2017 and 72,600 (12,300 premium) in 2018.

•Nominal personal income will increase 5.0 percent in 2016 and 5.6 percent in 2017 and 2018.

•Atlanta will add 54,500 jobs (10,000 premium jobs) in calendar year 2016, 52,100 jobs (9,300 premium) in 2017 and 52,000 jobs (9,000 premium) in 2018.

•Atlanta permitting activity in 2016 will increase 5.3 percent, grow 3.9 percent in 2017 and 2.2 percent in 2018.