The Red and Black

Issue date: 4/2/09 Section: News

Media Credit: WAITES LASETER Small businesses could be affected by the economic downturn once Athens begins to see more effects of the recession. There will likely be much less spending in local shops and restaurants. [Click to enlarge]

University students are likely insulated from the worst effects of the recession when they are in Athens.

"College towns have a bit of insulation," said Tom Jackson, UGA vice president of public affairs. "They're slower into the recession and slower out of it."

The unemployment rate for Athens-Clarke County as of February 2009 is 7.3 percent, Department of Labor statistics show. Georgia's seasonally adjusted unemployment rate is 9.3 percent, and the national unemployment rate is 8.1 percent.

"I wouldn't call it recession-proof, but I do think there will be less of an impact on Athens and other college towns," said Robert Sumichrast, dean of Terry College.

Athens Mayor Heidi Davison said, "Typically university towns are not affected as much by the ups and downs of the economy because they have a stable employer. They're shielded from a lot of the vagaries of the economy as it shifts," she said in a phone message.

Additionally, Sumichrast said, "you have students coming into town who have certain things they have to buy."

And the steady flow of student consumers benefits more than just the stores and restaurants downtown.

"Purchases made by students and employees … help keep tax revenue up and help create jobs," Sumichrast said.

The Athens economy began developing when the University was founded in 1801, and the school remains crucial to Athens today.

"Obviously [the University] is the dominant economic force in northeast Georgia," Jackson said. "It has a tremendous impact on the economy."

But it may not be enough.

"Although we may be doing better than other communities are because we have a university, this particular economic downturn has had some effects on Athens and the local community in terms of local businesses and certainly the local government budget," Davison said. "Although there is some buffering, it doesn't keep us completely shielded from the economy."

Continued...

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