The gist: Economist Loren Scott projects that the Lafayette economy will add 7,200 jobs over the next two years, according to his annual outlook presented Wednesday at an event hosted by One Acadiana. Scott’s rosy forecast rests on what he calls “heroic assumptions” about the growth of the U.S. economy and the prospect of more drilling activity in the Gulf of Mexico.
He projects the U.S. economy will grow 2.3% to 2.7% per year through 2021. But the nation’s leading economists are forecasting growth more like 2% per year.
Scott assumes President Donald Trump’s tariffs are negotiating gambits and not fundamentally economic protectionism. He believes that “Trump is a child with a hammer” when it comes to tariffs and predicted they’ll go away soon. He noted if his interpretation of the president’s trade policy is wrong, then “we’ll see a recession worse than 2008.”
Scott projects a modest recovery in the Gulf of Mexico. More specifically, he expects the rig count, a common benchmark for oil activity, to increase from 25 today to 35 over the next year or two. At one time, the Gulf had more than 60 rigs drilling, and the rigs currently operating require less manpower because of recent innovations improving efficiency.
Scott’s projection of job growth in Lafayette outpaces the national economy’s outlook. Nationwide, job growth is expected to increase by about 1% in 2020; Scott believes Lafayette’s job market will grow by 1.6% next year and 1.9% in 2021. Rig counts will have to rise to his predictions to meet that mark, he said.
Lafayette outpaced last year’s projections. In 2018, he projected an uptick of 1,400 jobs in Lafayette. Year over year through May, Lafayette’s MSA posted gains of 2,500 new jobs.
Acadiana is still fighting uphill after nation-leading job losses. At Scott’s pace, Lafayette would still be short 10,000 fewer jobs in two years than before the 2014 crash. More than 20,000 jobs have been lost since then.
“We’ll be lucky to see relatively flat employment over the next two years,” David Dismukes, head of LSU’s Center for Energy Studies, told The Advocate, presenting a view that challenges Scott’s optimism.