With Louisiana having suffered serious job losses in parts of the state over the last three years, there is still reason for optimism in 2018 — even if growth remains scattered, high in some regions of the state and lower in others.
The annual survey of the state’s economy headed by LSU Professor emeritus Loren Scott sees some optimism for the oil patch, hammered by declining oil prices since 2014. Some parts of the state are booming, particularly the Calcasieu River industrial corridor.
The Lake Charles area has been one of the fastest-growing metropolitan regions of the entire country for several years. The low price of natural gas is not good for energy drillers but it’s great for petrochemical manufacturing.
That continues in Lake Charles over the next two years, Scott forecasts, but metropolitan New Orleans also benefits, as new industrial construction is underway in St. James Parish.
There is a natural lifespan to job growth because of industrial construction: Scott forecasts that Lake Charles will slow to something more normal, perhaps 1.6 percent job growth in 2018 from 4 percent or more annually before. Yet there is potential for more employment in industrial construction because of the export market for natural gas.
At the same time, the torrid pace of industrial expansions in the Baton Rouge area is slowing, because of gradual completion of a remarkable $16 billion in petrochemical projects.
Still, more normal growth rates — 0.7 percent in 2018, 0.9 percent in 2019 — will be driven by projects in health care, the Baton Rouge Port and new high-tech companies, Scott forecast.
One note, though: “Resolution of the ‘fiscal cliff’ will likely add drag to this state-government-job-rich area.” That single sentence shows that action, or inaction, in the State Capitol over the budget and expiring taxes to fund the government will have a disproportionate economic impact in the Baton Rouge area.
Overall, if Scott’s report has its downbeat parts, the team that has followed Louisiana’s job markets for decades is not downhearted. After a two-year oil-related recession, the topline numbers are encouraging, adding 12,000 jobs in 2018 and more than 22,000 jobs in 2019.
“If our projections are on the mark, the state should reach 2,013,600 jobs in 2019, the first time it has exceeded 2,000,000 jobs on an annual basis in its history,” Scott’s report said.
We know that normal might not be exciting, but when it reflects steady growth in the biggest metro areas of New Orleans and Baton Rouge, albeit a slower recovery in Lafayette and other oil-patch communities, the next two years should be good ones for economic advancement — so long as folks in the state and national capitols don’t mess it up.