Louisiana State University economist Loren Scott presented his predictions for the state’s economy in 2023 and 2024 at an event in Baton Rouge on Tuesday. Scott presented the Louisiana Economic Forecast for the Greater Baton Rouge Business Report in conjunction with the Louisiana Business Symposium.
Scott contends Louisiana is well positioned to weather a national recession with significant job gains over the next two years, driven in large part by industrial construction, new health care facilities and Amazon distribution centers.
Rural parishes, meanwhile, are predicted to lose about 2,700 jobs.
The forecast suggests that despite the job gains, Louisiana will remain 38,000 jobs short of pre-pandemic employment numbers.
“Three major hurricanes, Winter Storm Uri, and floods have seriously arrested the state’s growth,” according to the forecast summary.
The Capital Region’s expected growth of 1.1% next year, and 2% in 2024, is fueled by an anticipated surge in industrial construction and a new $200 million Amazon fulfillment center, with the report citing a total of $12 billion in industrial projects underway and another $11 billion under consideration.
“We are told that engineering firms are jammed with front-end engineering work, and industrial construction companies are swamped by bid-prep demands,” according to the forecast.
The report notes New Orleans’ tourism industry struggled to recover from the pandemic and predicts a “short, shallow” recession next year could mean the industry continues to face challenges.
The struggles with tourism, however, are countered by an estimated $17 billion in industrial projects underway in the region, including a $13.2 billion natural gas facility in Plaquemines Parish, $550 million renewable diesel plant in Chalmette, and a $1.85 billion methanol plant in St. James Parish, among others.
Other highlights include Scott’s prediction the federal government will not hold lease sales for new oil and gas leases in the Gulf of Mexico next year, due to the Biden administration’s focus on cleaner energy. That prediction factored into employment totals for the Lafayette and Houma areas that rely on drilling activity.
Scott also doesn’t expect the national recession, which he predicts will start in the first quarter 2023 and last for three quarters, to have a major impact because of the state’s small durable goods sector.
The forecast noted nearly $3 billion in coastal projects through the Louisiana Coastal Protection and Restoration Authority that will boost the state’s economy in coming years, as well.
