Although Louisiana's economy is not immune to the recession, recently it has enjoyed higher job growth and lower unemployment than the South and the United States as a whole. In December 2008, it was one of only three states in the country to add jobs, according to the U.S. Department of Labor's Bureau of Labor Statistics. That healthy momentum continued into 2009, as Louisiana was the sole state where its unemployment rate decreased December to January from 5.5 percent to 5.1 percent. In contrast, the U.S. unemployment rate was 7.2 percent in December, and 7.6 percent in January.
One of the most significant factors in the current economic downturn is the fact that America's top banks have been under heavy strain. However, Louisiana's banking sector remains healthy and continues to make loans. In 2008, its banks grew their portfolios, thus avoiding some of the problems impacting the nation's biggest institutions. According to the state's Office of Financial Institutions data, the assets of Louisiana-based banks grew 12.7 percent in 2008 and loan portfolios increased 13.9 percent. Moreover, its Tier One capital - a measure of banks' health - rose 15.6 percent while deposits grew 10.7 percent.
Since 2008, Louisiana has enjoyed phenomenal economic development success. The state economic agency alone secured 34 major projects, including 24 company expansions and 10 new organizations. They represent its traditional industries - including agriculture, shipbuilding, and petrochemicals - as well as newer growth industries such as nuclear energy, digital media, and alternative energy. Together these projects will generate $2.5 billion in new capital investment, and be responsible for 10,005 retained jobs, 6,241 new direct jobs, and 17,249 total new indirect jobs. In March of this year, Governor Bobby Jindal signed an executive order creating the Louisiana Innovation Council to modernize and diversify the economy and create more knowledge-based jobs.
In New Orleans, the city "is an amazing success story now," says Austin Marks, chief of staff for Greater New Orleans, Inc. It's been nearly four years since Hurricane Katrina, and "finally we're getting the federal and state monies owed us for so long." In the next few years, that translates into $700 million for the city alone and $10 billion for the 10-parish region.
Investment continues to flow into three traditional industries - energy, trade, and manufacturing. Northrop Grumman Technical Services is building a 20,000-square-foot, $4 million high-tech shipbuilding facility expected to employ 85 workers. Marks says a tax credit program established in 2004 for digital media is supporting a "creatives" boom in New Orleans, partially powered by Turbo Squid (animation) and ISeatz (restaurant reservations).
The Baton Rouge area had the nation's 14th-lowest unemployment rate in February. It has been named one of the top 10 cities in which to "ride out a recession" by BusinessWeek. One new project of note is the headquarters relocation of chemical manufacturer Albemarle, expected to create at least 30 jobs with an annual payroll of $7 million. Another "win" is the landing of a new Electronic Arts video game quality assurance center, set to employ 20 full-time and 200 part-time workers.
Marks predicts that Louisiana is poised to make tremendous economic development strides in the next year or two and "leapfrog over this recession" into greater prosperity.