Economic Update April, 2019 Louisiana Louisiana is a rich state - - PowerPoint PPT Presentation

Louisiana and Greater New Orleans Economic Update

April, 2019

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Louisiana is a rich state with a poor structure; it needs to reform to reach its potential. Louisiana

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Louisiana Strengths

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Louisiana continuously ranks near the top for doing business.

Economic Development

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Billions are being invested in northern Louisiana natural gas plays.

The Shale Revolution

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Driving over $170B of industrial projects, primarily in south LA.

The Shale Revolution

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Louisiana has become a major destination for global investment.

#1 per Capita Foreign Direct Investment

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Louisiana is #5 in the country for software employment growth.

Tech Diversification

Source: Software.org, BSA Foundation

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Louisiana has the lowest overall business cost in the country.

Low Business Cost

Source: KPMG Competitive Alternatives

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Louisiana has the #1 ranked Workforce training program, and the #2 “Most Engaged” workforce in America.

Workforce

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Louisiana is a top state in the U.S. for new millennials.

Millennial Influx

Source: U.S. Census Bureau, Porch.com

STATES WITH THE HIGHEST PERCENTAGE OF NEW MILLENNIAL RESIDENTS

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Louisiana Challenges

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In 2012, the state’s GDP has decreased by 8% from 2010 – 2017.

Economy

Source: U.S. Bureau of Economic Analysis, Real Total Gross Domestic Product for Louisiana, retrieved from FRED, Federal Reserve Bank of St. Louis

Real Total Gross Domestic Product for Louisiana (2012 dollars)

$226.6B

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After experiencing significant job growth in the aftermath of the Great Recession, Louisiana has lost jobs since 2015.

Jobs

Source: U.S. Bureau of Labor Statistics, All Employees: Total Nonfarm in Louisiana, Annual, Not Seasonally Adjusted, retrieved from FRED, Federal Reserve Bank of St. Louis

Louisiana Total Nonfarm Employees

1,971,000

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Having decreased significantly since the great recession, Louisiana’s unemployment is still higher than the national average.

Unemployment

Source: U.S. Bureau of Labor Statistics, Unemployment Rate in Louisiana, retrieved from FRED, Federal Reserve Bank of St. Louis

Louisiana Unemployment Rate

4.9% 11.3%

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Louisiana’s tax climate is increasingly seen as unfriendly to business.

Tax Structure

Source: Tax Foundation

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Louisiana is #1 in the USA for increases in taxes on business.

Tax Structure

Source: LABI

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Louisiana’s has the highest auto insurance rates in the country, which impacts both businesses and individuals.

Insurance

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Louisiana has only two Fortune 500 headquarters.

Lack of Headquarters

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Louisiana is a rich state with a poor structure. Does the political will exist to change it?

State Structure

Ex: Personal Income Tax Ex: Constitution

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While Louisiana has an unmatched culture, the state ranks near the bottom of some lists of “the best states to live in.”

Quality of Life

• 10. New Mexico
• 9. (tie) Mississippi
• 9. (tie) South Carolina
• 7. Oklahoma
• 6. Missouri
• 5. Indiana
• 4. Tennessee
• 3. Alabama
• 2. Louisiana
• 1. Arkansas

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Louisiana Challenges Summary

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Greater New Orleans is doing better than in decades, but must rebuild drainage system. Greater New Orleans

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Greater New Orleans Strengths

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After decades as a “two-trick” pony, the New Orleans region is diversifying.

For Immediate Release January 24, 2019

Port NOLA Sets Container Record in 2018

Economic Diversification

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New Orleans is the fastest growing tech city in the country, and is Top Five for women and minorities in technology jobs.

Tech Growth

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Third-Party Validation

New Orleans: Silicon Valley of the South? “Rising Tech Hub” Tech Market to Watch Top 10 in USA for African Americans and Women in Tech

Entities from around the country are taking notice of tech growth in the region.

Technology

DXC Technology is the biggest economic development jobs win in Louisiana history.

Technology

Amazon continues to expand in Greater New Orleans.

Trade

Avondale is back on-line after nearly a decade.

F

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m

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a S e l e c t s S t . J a m e s P a r i s h f

• r

$ 9 . 4 B L

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i s i a n a P r

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Energy & Petrochemical

GNO has had nearly $20B of announcements over three years.

“Technology Center Of The Americas” Will Produce and Test The Largest Offshore Blades in The World

Advanced Manufacturing

Michoud is a public and private-sector leader world-leader.

Building the “Business of Music” in Greater New Orleans

More Diversification

The New Orleans Music Economy Initiative will take back the mantle of “Music City” from Nashville.

Home to over 71,000 students, Greater New Orleans is uniquely positioned for higher education and industry based partnerships.

Higher Education

Air Connectivity

Over the past decade, the New Orleans International Airport is the 3rd fastest growing in the country.

Tourism

Over the past decade, the New Orleans International Airport is the 3rd fastest growing in the country.

Downtown Development

Over $1B of hotels, and nearly 1,000 apartments are under construction in the Central Business District

Demographics

New Orleans is San Francisco, at half the cost, with better food, and nicer people.

Cost of Living

At the national average, Louisiana is significantly cheaper in terms of cost of living when compared to other metros.

50 100 150 200 250 Austin Nashville New Orleans Atlanta Dallas Washington D.C. San Francisco Manhattan

Cost of Living

National Average 98.4 99.2 100.7 101.8 105.4 162.6 196.3 248.5

Source: C2ER 2018 Annual Average. Cost of Living includes: Grocery items, Housing, Utilities, Transportation, Health Care, and Misc. Goods and Services

It would take over $600,000 in Manhattan to equal a $250,000 salary in New Orleans

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Since Hurricane Katrina, New Orleans has experienced significant education reform.

Education Reform

0% 10% 20% 30% 40% 50% 60% 70% 80%

Percent of Orleans Parish Students Graduating in 4-years

2004 2017

Source: Washington Post

0% 10% 20% 30% 40% 50% 60% 70%

Percent of Orleans Parish Graduates Enrolling in College

2004 2017

54% 73% 37% 61%

Crime

The crime situation is slowly but steadily improving.

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In an increasingly homogeneous world, the unique quality of life in New Orleans is a real competitive advantage.

Quality of Life

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Third Party Validation

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Third Party Validation

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Greater New Orleans Challenges

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After outpacing the national employment growth rate over the past decade, the metro area has trailed the national growth rate recently.

Employment Growth

Source: U.S. Bureau of Labor Statistics, All Employees: Total Nonfarm in New Orleans-Metairie, LA, retrieved from FRED, Federal Reserve Bank of St. Louis

% Growth in Total Nonfarm Employees

(New Orleans Metro)

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While the regional population is 96% of its pre-Katrina level, white collar jobs are only 87%, a deficit of nearly 33,000 jobs.

White Collar Jobs

• As of 2016, white

collar jobs represented only 39% of the regional labor force, compared to 42% nationally

• We need more white

collar jobs to retain the post-Katrina “brain gain”

Pop. 1,338,000 Pop. 1,278,000

Source: Bureau of Labor Statistics, May 2016; US Census

Jobs 250,000 Jobs 218,000

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Wages are rising, but a persistent gap exists with the US average – and wages in GNO are rising slower than the cost of living.

Wages

Note: Wages are not adjusted for inflation Source: Bureau of Labor Statistics, May 2016

NOLA AVG.

As of 2016, wages in New Orleans were $6,000 below the national average

(New Orleans Metro)

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Large income gaps by race persist.

Lack of Shared Prosperity

Source: The Data Center

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While beloved around the world, the New Orleans brand is a “double- edged sword.”

The New Orleans Brand

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New Orleans needs a new drainage system.

Stormwater Drainage

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Thank you

President and CEO, Greater New Orleans, Inc. mhecht@gnoinc.org (504) 715-5037

Michael Hecht