ATLANTA - It may be the same headline, but few in Savannah could be tired of reading that their city's economic growth is among the fastest in the state, according to a report issued Wednesday by Georgia State University's Economic Forecasting Center.

Savannah is predicted to finish the year with 2.6 percent growth, exactly twice the overall state rate.

At the same time, Georgia's economy is likely to slow along with the rest of the nation as consumers react to soaring gas prices and the crackdown on borrowers with subprime mortgages, the quarterly forecast predicted.

"Slowly but surely in the last 12 months, the macro environment has changed for the worse, even though the Fed stopped hiking rates last summer," notes Rajeev Dhawan, the center's director. "Gasoline prices peaked last summer, moderated sharply in the fall and are now climbing even before this year's hurricane season."

Savannah: Hotels, houses, planes and ports

What is helping the Savannah metro area beat the national trend is the mix of the local economy. Some of the hottest sectors are big in the Coastal Empire:

Tourism, for example, added 960 jobs in the first three months of the year, and business/professional services pumped in another 560 paychecks.

Construction is booming in the region despite a broader slowdown elsewhere. Construction added 480 jobs in the first quarter in Savannah while the Georgia State forecast calls for the sector to moderate its growth statewide.

Within the manufacturing sector, the transportation-equipment industry is the state's most robust source of exports. Yet, the Georgia State forecast calls for it to shrink during this year. But in Savannah, Gulfstream Aerospace's expansion continues to bear fruit.

"Savannah's port, Garden City Terminal, is a constant source of new business," Dhawan said. "Apart from port activity, Savannah is also attracting other types of businesses."

He points to the $800 million mixed-use Savannah River Landing project incorporating retail and residential components as one example.

Savannah's strength almost strikes Dhawan as old news.

"As usual, Savannah will post one of the best employment growth rates in the state, with a 2.6 percent increase in 2007 and a 3.3 percent gain in 2008," he notes in his forecast.

The picture outside Savannah

Gas prices aren't the only thing prompting people statewide and nationally to cut back on their spending, he said.

"Higher mortgage payments and its fallout in terms of foreclosures, when coupled with elevated gas prices, will not only dent consumers' pockets but also their desire to buy products," he said.

Businesses are reacting by either trimming workers - many voluntarily - or by slowing their hiring rate.

Dhawan is predicting the number of jobs in Georgia will still grow, but at just 1.3 percent this year. Unemployment will rise slightly to 4.8 percent, better than last year's 5.6 percent but lower than the year before that.

He's guessing the Federal Reserve will begin cutting interest rates again by as much as 75 basis points to prevent the economy from stalling completely.