Louisiana economists say they’re seeing the beginnings of an economic boom that will create a record number of jobs over the next couple of years. Houston Public Radio’s Jim Bell reports.
Economists at Louisiana State University say this boom is already underway because of record oil prices and the billions of dollars the federal government and the private sector are pouring into Louisiana for hurricane recovery and reconstruction. LSU Economics Professor Emeritus Loren Scott says it’s going to push Louisiana employment to an all time high next year.
“We’re forecasting for the next two years the state will gain about somewhere in the neighborhood of 70,000 new jobs. We think that by the end of this year we will have recovered all the jobs lost because of the hurricanes except for about 3,400, and then by ’08 we’ll be setting new record levels of employment and that will continue into ’09.”
Scott says most of the new jobs will be in the construction industry, and they’re the direct result of Hurricanes Katrina and Rita. What those storms destroyed is already being replaced.
“For example in the New Orleans metropolitan area you have $19 billion in construction projects. In a normal year, if they had one billion it would have been considered very good, but they have $19 billion. The Baton Rouge area we have $5 billion in construction projects going on, so the construction sector is really leading the way out.”
Scott says record oil prices are also pulling up Louisiana’s economy, especially in industries that support the off-shore oil rigs. He says for example that Louisiana ship-builders can’t build off-shore supply boats fast enough.
Scott says there is a dark cloud behind this silver lining, and that dark cloud is about the size of New Orleans. The jobs boom will be felt across the state, but not in the four parishes behind the levees in the New Orleans area. He says those areas will continue to struggle for the foreseeable future because executives who make construction decisions are skittish about building and rebuilding in an area that could get wiped out again.
“I’m sure that they remain a little nervous about the downtown New Orleans area, or anywhere behind the levees They saw what happened with Katrina, the reflooding with Rita in that area, they know that the Army Corps of Engineers is building up the levees to a hurricane 3 force hurricane, but you know Katrina and Rita were more than that and it caused flooding.”
Scott says the areas below sea-level in New Orleans will gain some projects and some jobs, but nowhere near as many as the rest of the state.
“If you are a carpenter, if you’re a welder, if you’re a pipefitter, you can write your own ticket over here now. I mean there is a ton of construction work to be done.”
Jim Bell, Houston Public Radio News.