In order to be economically competitive as a city, Lafayette needs to offer quality of life amenities. In the rush to cut budgets, Mayor-President Guillory is putting the city’s quality of life at risk, reducing its ability to retain and attract people, especially young families.
Lafayette’s economy can’t get healthy if its people aren’t healthy. The only way to slow the spread of this coronavirus is to get 80-90% of people to wear masks or to shut the everything back down again. Faced with those options, Lafayette needs to do everything in its power to get people to wear masks, not just to save lives but to save our economy.
Lafayette is facing a severe housing crisis, with thousands of people at risk of losing their homes. This crisis started before the pandemic, but the coronavirus and its impact on our economy has just added fuel to a fire that’s now threatening to rage through our community.
The gist: April sales numbers released by LEDA highlight the economic fallout from the state’s coronavirus lockdown. Total retail sales in the parish in March and April fell $112 million in 2020 when compared to the same months in 2019.
The gist: A new economic forecast projects that the Lafayette metro area will lead the state in jobs lost from the first quarter of this year to the second. Modeling by economist Gary Wagner of UL Lafayette’s B.I. Moody III College of Business Administration shows the area recovering less than 10% of those jobs over the next 18 months.
The gist: Data projections by the St. Louis Federal Reserve Bank rank Lafayette among the areas at highest risk for substantial joblessness in the country. Among the top 150 largest metro areas in the country, Lafayette ranked 20th, ahead of New Orleans, Shreveport and Baton Rouge.
The gist: The purpose of the recently passed federal stimulus is to counterbalance the hit that’s happening from stay-in-place orders crippling economic activity. While this stimulus will help a number of businesses weather this storm, it’s not near enough to protect Lafayette’s oil and gas industry, which faces existential threats that require more than short-term subsidies.
The gist: Local and national analysts warn that 30% or more of the nation’s workforce could lose their jobs because of the economic freeze associated with the coronavirus. So long as oil prices remain low — a function of an international price war and a collapse in consumption — the Lafayette metro area could see as many as 60,000 people out of work over the next few months.
The challenges facing Lafayette’s economy may seem overwhelming but you can help right the ship by spending money or making it, and that means more than just shopping local.
The gist: On Monday, the price of oil had its greatest one-day plunge ever, and coronavirus officially arrived in Louisiana. Markets tumbled nationally, with signs pointing toward a global recession on the horizon. These developments pose threats the Lafayette economy is particularly vulnerable to.
The gist: UL Economist Gary Wagner predicts around 1% job growth for Acadiana this year, a rate that would beat statewide projections but still lag behind the nation. Speaking at The Acadiana Advocate’s Economic Summit Wednesday, Wagner was joined by a panel of business leaders optimistic about the region’s economy going forward.
Over the last year, Lafayette’s MSA has seen some of the best job growth since 2013, according to Wagner. “This recent growth is consistent with the long-run average growth in the region,” he said.
Oil and gas jobs are still down 40% since 2014. And Wagner said growth in oil and gas jobs is flat.
But healthcare has been picking up some of the slack. Wagner believes the industry will soon be the largest sector of the local economy. Oil and gas, once the largest industry in the area, is now fourth.
The biggest risk to his projections is a national recession. The U.S. economy is experiencing a record 126 consecutive months of growth, which is why there’s been a lot of talk about an inevitable recession, potentially soon. If a national recession does happen in 2020, Wagner said it would lower his projections for local job growth.
“We need to create more jobs with higher pay at a faster pace,” Wagner continued, chiming in on a discussion of his research into the causes of severe outmigration patterns in Louisiana. More than 90,000 residents have left the state over the last few years.
Business leaders are generally optimistic. “With the fall of oil and gas, we should be going down,” said John Bordelon, CEO of Home Bank. “But we’re not because of the resiliency of our people.”
Hotel/motel occupancy has been rebounding. While not fully recovered from 2014 highs, occupancy has been up in eight out of the last 11 months, according to Ben Berthelot, president and CEO of the Lafayette Convention and Visitors Commission. He credited some of that growth to public investment in sports complexes in Broussard and Youngsville, which have attracted sporting events, and LCVC’s recruitment of events to this area.
There’s still hope for growth driven by Opportunity Zones. Opportunity Zones are low-income areas where special tax breaks have been designed to encourage investment in development and companies. One Acadiana President and CEO Troy Wayman cited Lafayette General Health’s fund for Oil Center investment as one example. And commercial Realtor Flo Meadows shared her belief that 2020 will be the year to watch for Opportunity Zone investments, citing $500 billion in available capital in the program nationwide.
Oil execs blamed lawsuits and warned that a slow down in Texas could hurt local companies. Art Price, CFO of Badger Oil, linked an “all-time high” in the number of suits, which seek restitution for environmental damage from decades of drilling, to depressed drilling activity in the state. While the number of oil rigs has doubled nationally since 2015, Louisiana’s share has tanked and failed to recover. Most Louisiana activity is concentrated in the Haynesville Shale and deep waters. Price also warned that a recent bonanza in Texas’ Permian Basin could cool off, potentially hurting the many Lafayette companies that have deployed personnel and equipment there. The bottom line: Price projects 2020 to be more of the same stagnation as was seen in 2019 in Lafayette’s oil and gas sector.
GDP, personal income, employment, retail and real estate sales are all increasing, but without oil and gas recovering our economy is trending towards mediocrity.