La. ranks poorly in ‘new economy’ study

Louisiana ranked No. 46 in a ranking of states based on “the New Economy,” according to the Information Technology and Innovation Foundation.

The 2014 State New Economy Index measures how states and regions are performing in an environment that emphasizes technological innovation, globalization and entrepreneurial development. The index uses 25 indicators in five categories to assess states’ fundamental capacity to transform their economies and incubate innovation: knowledge jobs, globalization, economic dynamism, the digital economy and innovation capacity.

Louisiana scored highest in export focus of manufacturing and services, ranking No. 5, and manufacturing value-added, at No. 6. Value added is the difference between the raw materials and the value of the final product or service.

Louisiana Economic Development Secretary Stephen Moret said the state’s poor ranking reflects its historical strengths: the energy/petrochemical, agriculture, shipbuilding, trade and tourism industries.

“However, since 2008, we’ve been working successfully to cultivate new growth industries, such as aerospace, water management and software development, which can diversify our economy while accelerating our growth,” Moret said. “In particular, we’ve cultivated the software development and digital media sector, including aggressive national marketing, business recruitment, targeted incentives and investments to expand computer science programs at our universities.”

A sampling of elements that could improve the state’s ranking in the New Economy Index the next few years include:

Committing $37.5 million in funding over the next 10 years for computer science programs at LSU, Louisiana Tech University, the University of Louisiana at Lafayette and the University of New Orleans.

A push to recruit and encourage the establishment of software and digital media companies. Employment in the sector has increased nearly 25 percent since January 2008. Tech companies CGI, CenturyLink, CSC, EA, GE Capital and IBM, among others, have announced projects that will collectively create more than 4,500 jobs, and most will be filled in the next three years.

“Indeed, in our entire state’s history, there has never been a better time than today for our college graduates to secure high-tech jobs right here at home,” Moret said.

The top five states in this year’s index are Massachusetts, Delaware, California, Washington and Maryland. Mississippi was the lowest-scoring state. At No. 49 to 47 are West Virginia, Oklahoma and Arkansas.

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