Economist: Gulf Coast outlook brightens

Published 1:54 am Wednesday, October 7, 2009

The economic outlook should brighten in 2010-2011 for the Mississippi and Alabama coasts, but that’s not the case for the New Orleans area, an economist said Tuesday at a regional economic forum.

Lack of business investment within a still-untested levee system and recession-generated convention and corporate travel woes are creating a “very tragic” outlook for the New Orleans area, Loren Scott said.

Of metropolitan areas Scott examined in coastal Louisiana, Mississippi and Alabama, New Orleans was alone with a slim outlook for major business expansion as the nation begins to pull up from the recession. Scott’s forecast came during the Hancock Bank Gulf Coast Economic Symposium in Biloxi.

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Hurricane Katrina demolished New Orleans and the Mississippi coast, and damaged southwest Alabama, when it struck Aug. 29, 2005. While the Mississippi casino business has rebuilt and hasn’t faced another storm, New Orleans took a glancing blow from Hurricane Gustav in 2008. The evacuation and shutdown of the city — and businesses — for days gave companies even more to think about when considering the area for expansion, Scott said. The city was abandoned for weeks after Katrina.

By contrast, Scott expects a fairly positive outlook for Pascagoula, Miss., with oil and gas and manufacturing projects on tap, and Mobile, Ala., where military and manufacturing work should create jobs over the next two years. Jobs and revenue lost by the casino industry in Biloxi-Gulfport due to the recession are not permanent and should recover, he said.

While employment still hasn’t regained pre-Katrina status in Biloxi-Gulfport, Scott said the region is “way better off than New Orleans.”

Job levels for New Orleans have been below 1980 totals and Scott expects the area to be Louisiana’s slowest growing in 2010-2011. He planned to release a detailed forecast for Louisiana metro areas on Wednesday.

While Scott said more than $10 billion in construction work is planned or should be under way in the New Orleans area during the period, much of it is in infrastructure construction and not tied to new business. Expected job losses at Lockheed Martin Space Systems as the company’s space shuttle work winds down likely will overwhelm other gains in manufacturing, he said.