Obviously, we can’t say that six months does not a trend make. And Louisiana’s unemployment rate has been edging up for that time, although it is still slightly below the national average.
That’s a trend and not a good one.
At about 7 percent, the state unemployment rate may reflect not only the impact of government layoffs but also some hidden good news, that people are seeing a slowly improving national economy and thus are looking for work — and thus being counted in the official unemployment tally.
However, government layoffs probably are a significant factor, given the thousands of layoffs in the privatization of the old charity hospital system. While many skilled workers such as nurses would be quickly rehired, other workers might not be.
Still, we think that there are other factors, positive and negative, that deserve attention. One is the observation of Curt Eysink, director of the state Workforce Commission, that the state has a higher percentage of people participating in the job market. The state and national numbers are thus not exactly comparable, although for political reasons many do.
Nationally, though, the rate of applications for unemployment benefits is slowing, the best since prerecession levels. That might suggest more hiring at the national economy at some point.
But another issue that is more Louisiana-specific is the impact of hurricane recovery and rebuilding since 2005, including the significant boost from Hurricane Gustav in 2008.
It’s probably not a coincidence that Louisiana’s unemployment rate has been below the national average during that period.
There is no question that our economy has been artificially buoyed by hurricane stimulus, and please God let us not have more of it anytime soon.
Most of the time, though, Louisiana’s unemployment rate tends to be above the national average. Our population growth is disappointing; our educational attainment too low; our employment base not sufficiently diverse.
Those underlying factors are significant drags on growth. They have been for some time, and when some states plummet farther in recessions, we don’t have as far to fall.
Still, the recent rise in unemployment may be a temporary phenomenon. Louisiana is one of 14 states that has now exceeded its employment numbers since the 2008 recession year. And, in significant part because of natural gas production and thus low prices, industrial construction is beginning what may be a boom time.
Multibillion-dollar construction announcements are routine. Hiring for that work will affect the petrochemical corridors along the Mississippi and Calcasieu rivers.
“As I look at the next few years, I see tens of thousands of new jobs,” said Stephen Moret, head of the state’s economic development office. “I’m quite optimistic about the future.”
We remain optimistic too, but we also look with concern at the cutbacks to higher education in recent years. If there is a long-term economic development strategy, not hostage to the price of natural gas, it is in education investment at all levels.
Louisiana’s unemployment rate has probably been getting back to normal, but we should not be satisfied with that.