Economic outlook: Lake Charles continues to be one of fastest growing areas in nation
LAKE CHARLES, LA (KPLC) - The Lake Charles area continues to be one of the fastest growing areas in the nation, according to a report released this week by Louisiana State University College of Business Professor Loren Scott.
According to Scott, the 2019-2020 Louisiana Economic Outlook shows job growth on the horizon following the state’s recession.
“The Louisiana economy emerged from a 28-month recession in late 2017 that cost our state over 23,000 jobs,” said Scott. “It was odd in that most of the losses were in the oil patch, Lafayette (-21,600 jobs) and Houma (-16,200 jobs), while the Lake Charles MSA (metropolitan statistical area) was the fastest growing MSA in the entire country.”
The state is expected to add 59,500 jobs in the next two years, which would surpass the two-million-job mark for the first time in Louisiana’s history. Scott said oil prices are projected to go down then return, reaching about $80 a barrel in 2020.
Scott said the real boost for the economy is expected to come from major industrial expansions along the Calcasieu Ship Channel in the Lake Charles MSA and along the Mississippi River, from Baton Rouge to the mouth of the river. More than $170 billion in industrial expansions have been announced in these areas from 2012-18.
Scott said Lake Charles should once again be the fastest-growing MSA in the state, averaging 3.8 percent growth a year, based on final investment decisions on three LNG export facilities.
Scott’s outlook on other areas of the state:
- Industrial expansions will drive the Baton Rouge MSA to the second-fastest-growing MSA in Louisiana (1.7 percent per year over 2019-20).
- The state’s largest MSA, the nine-parish New Orleans region, has several extensive industrial projects underway and a number that should pull the construction trigger over the next two years. Most significant growth will occur in St. James and Plaquemines Parishes, though the Central Business District will get a major boost from the new, 2,000-person DXC Technology Company. This region should add 15,600 jobs, but will still be 34,500 jobs below its pre-Katrina peak.
- The central and northern parts of the state, above Interstate 10, have landed few new projects, resulting in lower growth rates.
- On Interstate 12, the Hammond MSA will feed off the growth in New Orleans and Baton Rouge and a more settled budget at Southeastern Louisiana University to generate around 1,600 new jobs over 2019-20.
Scott says he has two areas of concern: “The most serious is whether President Trump’s trade initiatives will create a recession-inducing trade war. Secondly, the International Maritime Organization within the UN will require ocean-going ships to use lower sulfur diesel starting Jan. 1, 2020. Will IMO’s directive drive oil prices to $160 and create a worldwide recession? Or will the subsequent oil price increase be much lower and more manageable? There is a lot of uncertainty ahead.”
The outlook was funded by BlueCross BlueShield of Louisiana, Cleco and Home Bank and ExxonMobil.
Copyright 2018 KPLC. All rights reserved.