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Atlanta's hot economy comes with high costs, experts say

The Federal Reserve Bank of Atlanta says housing prices and costs of services remain high due to an influx of new residents and businesses

STOCKBRIDGE, Ga. — George and Andrea Burnett started Powerhouse Termite and Pest Control 21 years ago. The power couple has been married for 34 years. Their business serves more than 350 customers across metro Atlanta with about seven employees. 

The business owners have won awards for their growth and improvement, and they're guided by their faith and optimism to one day become one of the top 100 pest control businesses in the United States. But lately, they have seen a decline in new business.

“They’re maintaining, still getting the service," George said. "It’s not like we’re losing business, we’re just not gaining new business at this time.”

The biggest challenge the Burnetts are facing is inflation, especially paying for gas and products, and building a qualified sales team that can draw new business. 

"You have to pay more for everything," Andrea said. "Customers pay more for everything else, so it’s just in line. You can’t skimp, because our vendors are charging us more, so we have to respond to that.”

Brent Meyer, assistant vice president and economist at the Federal Reserve Bank of Atlanta, said the economy in metro Atlanta is much hotter than the macroeconomy across the United States. 

"A lot of that has to do with net migration to Atlanta," Meyer said. “Think about Atlanta’s job market, I think it’s still very strong. There’s a lot of new businesses forming in the area. Employment conditions are very strong, and perhaps a bit stronger than the overall broad U.S. economy.”

While all the new neighbors are contributing to relatively high housing prices, Meyer said interest rate hikes implemented by the Fed have driven down inflation in many other sectors by about half. 

“Past policy actions are starting to impact the economy and are starting to slow prices," Meyer said. "Some of the pandemic-related drivers of price increases, especially with supply chain constraints and labor constraints, those are starting to alleviate. We are seeing some tentative signs that inflation is beginning to moderate.”

Meyer said data indicated the economy, both in metro Atlanta and nationwide, was going to remain strong and resilient despite some experts predicting a possible recession at some point in the next year due to slowed economic growth, credit worries and regional bank failures. 

Meyer said it could take a couple of years to feel the true effects of the Fed's rate hikes and other policy measures to try and reign in inflation to the Federal Open Market Committee's two-percent target goal.

Meantime, the Burnetts are focused on keeping current business steady while hoping new business picks up soon. 

"The future is bright, the future is what you make it," George said. "I’m excited about the future.”

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