Personal income in Louisiana swelled in the second quarter of this year, with energy, health care and most other sectors leading the charge, according to a report by the U.S. Bureau of Economic Analysis.
With 1.4 percent growth, Louisiana moved to 10th place when measuring the personal income growth between the first and second quarters of this year.
The state’s personal income grew 5.3 percent in the past year. Personal income is defined as the total income from all persons and from all sources. The state’s personal income in the second quarter stood at just under $176.0 billion. A year earlier it was $167.2 billion.
“If you look at the individual numbers, it looks like a pretty darn good, overall, solid kinda economy,” said Loren Scott, a retired LSU economist and close follower of the state’s economic indicators. “It wasn’t like we got to 10th place by saying, ‘Well here, it’s all oil and gas.’ It wasn’t all oil and gas.”
However, oil and gas did play a substantial role. The personal income related to the industry grew 5.5 percent, or some $300 million in the second quarter, an amount surpassed only by Colorado and Texas.
“There’s no question that the energy part plays a role,” Scott said.
“It wasn’t the overwhelming factor,” he added. “What is kind of striking is how good the numbers were just across the board. Not only was the mining sector strong, but compared to the rest of the country, both our durable and nondurable goods manufacturing was strong. Health care was strong. There were only, I think, three places where we had a loss in income.”
Personal income fell in only farming, education and government sectors.
Energy, however, is a traditional industry sector for Louisiana that is expected to remain strong, said Stephen Moret, secretary of the Louisiana Economic Development department.
“Wood products, ship-building, the chemical industry and agriculture, altogether, will not likely be major growth-drivers in the future,” he explained. “Not because of any Louisiana issue, but just because of the structure of the future of those industries.
“Energy is an exception because as long as the regulatory environment is OK, we’re going to see big growth in deepwater drilling, unconventional natural gas, enhanced oil recovery and even in some of the traditional drilling activity,” said Moret, “plus things like the gas-to-liquids products,” he added, calling to mind the growing interest in converting natural gas to a liquid fuel source. “So overall, I think energy’s got a pretty good future in Louisiana.”
Nationally, state personal income growth slowed to 1.1 percent, on average, in the second quarter of 2011, down from 2.1 percent during the first quarter, the BEA reported.
States with the most growth in the second quarter trended toward the big agricultural states in the Midwest, where crop output was up 9 percent and global grain demand remains high due to soybean exports to China and corn being converted to ethanol. Nebraska was ranked No. 1, at 2.2 percent personal income growth, followed by South Dakota, North Dakota, Oklahoma and Wyoming.