"In the case of New Orleans, the model we used was the housing situation," says Scott. "The initial Red Cross estimate of houses destroyed was 267,000, and 75 percent of them are in New Orleans. So we argue that the strength and speed of the recovery will be limited by the availability of housing. If someone has eight restaurants, even if they open them back up again right now, they can't staff them because the workers don't have housing."
The housing formula generates sobering statistics on the post-Katrina economic outlook for the state. Even as Scott and his team of economists added 20,000-30,000 jobs for relief workers living in or commuting to New Orleans to their data, they arrived at a total of 337,000 jobs ' a number that effectively wipes out four decades of growth and puts the Crescent City at its 1963 employment levels.
Scott's estimates were also informed by personal experience. He has a townhouse in Old Metairie that took on more than 4 feet of water and has been back to the city numerous times to try and sort out insurance issues. And like so many other Louisiana residents, he has a hard time seeing a clear picture of the timetable for rebuilding efforts. "There's a limit on flood insurance, there's a shortage of contractors, problems with mold remediation â?¦ so when you look at the total number of homes damaged, it boggles the mind. Some people have asked what the margin of error is for this forecast, and we tried to hold our hands apart as far as we could. There's just so much uncertainty."
Even the staggering mid-80s Louisiana recession caused by the oil industry's downturn doesn't compare to Katrina's damage to the economy. "The size and geographic impact are the two main differences," says Scott. "The [oil] recession occurred over a six-year period, and we lost 9 percent of our jobs ' about 148,000 in the state. That's a huge hit, and it hit virtually every metro area in the state. Now we've lost twice as many jobs in about two months, but it's been like a rifle shot aimed directly at New Orleans."
With so much of the damage concentrated in the New Orleans region, Scott emphatically warns of a false sense of economic security in areas such as Baton Rouge, Acadiana and north Louisiana, which mostly emerged physically unscathed from hurricanes Katrina and Rita. "We're already doing surveys in Baton Rouge on how much business there relies on New Orleans, and it's a lot," he says. Suppliers from multiple industries have lost their New Orleans customer base, and the flip side is also true; restaurateurs in particular have scrambled to try and replace goods they bought from New Orleans. The overall ripple effect is significant. (Scott, for example, had four speaking engagements in New Orleans cancelled, and the status of his consulting contract with the city of Kenner is up in the air.)
While the metro New Orleans area staggers to get back on its feet, Scott says displaced residents and businesses will spur economic growth in other regions of the state. He estimates that Baton Rouge will be able to accommodate up to 50,000 new residents and 23,000 jobs, making the capital city the state's largest metropolitan area in 2006. Retail operations in Houma should also increase. Statewide, the already-booming construction industry will make further gains. And oil industry infrastructure repairs will bring increased employment in the Lafayette region.
"[Lafayette] has the servicing firms that are going to be charged with repairing structures in the Gulf of Mexico," he says. "As a result, we bumped up Lafayette by 4,000 jobs in 2006. It's going to take a minimum of one year to repair some of these pipelines and platforms. The Chevron Typhoon, a billion dollar facility, has been inverted. So if you're a fisherman, imagine a $1 billion bobber turned upside down."
While those repairs are under way, Scott says New Orleans' main economic engines ' the petrochemical industry, tourism, shipbuilding and the port system ' can only recover as fast as the housing situation in New Orleans improves. "Bollinger and Avondale ship yards and Lockheed Martin will come back, but they're struggling because they're labor-intensive and workers need places to live.
"The most problematic area is tourism," he adds. "Jazz Fest and Mardi Gras will come back at a smaller level to start, but the biggest problem is convention business. In the past, if you were a convention planner looking at dates between June and November [during hurricane season], there was always a little red flag. Now it's a big red flag."
Ultimately, Scott says federal relief money is the biggest question mark ' and he's discouraged by recent developments. "There are some recent proposals like the Louisiana Recovery Act, where the federal government will buy property and people will then get some of their wealth back. For some people, injection of federal money is going to be critical, because at least part of their wealth is built up in their homes. And we have to do something about the levee system. If you do want to rebuild, who's going to loan you money in an area that's been flooded when the levee system hasn't been fixed? But the unnerving thing is to watch the change [at the federal level] since we've gotten further and further away from the hurricane. The drop in sympathy level is palpable."
The Board of Elementary and Secondary Education has stalled action on a $3.5 billion annual school funding formula due to state lawmakers by March 15.
The New Orleans Saints have yet to make it official as of this writing, but popular wide receiver Lance Moore has reportedly been cut by the team to free up salary-cap space on the roster.
While two medical marijuana bills are slated for the upcoming legislative session, what some Louisianans might not know is that the plant was approved for therapeutic use by state lawmakers in 1991.
The agenda is shaping up to be lighter than in previous years. But Jindal is term-limited, with fewer than two years remaining in office, and he saw his last big initiative — a proposed rewrite of Louisiana tax law — collapse without getting a vote in 2013.
Sharper has been held without bail because of an arrest warrant issued by Louisiana authorities accusing him and another man of raping two women.
Here's your daily look at late-breaking national and international news, upcoming events and the stories that will be talked about Friday, March 07, 2014:
Two Lafayette men have been revealed by police as the infamous duo behind a caper that shook our fair city to its core.
The Lafayette Parish School Board has received a second letter of demand related to last year’s insurance debacle, this time from Key Benefit Administrators claiming it’s owed $93,000 from the school system.
The Louisiana coastline is vanishing faster than mappers can keep track.
A bill that would have overridden local ordinances prohibiting public and private employers from discriminating against lesbian, gay and transgender people has been pulled within less than a week of being filed.
The panel that selects nominees for a controversial New Orleans area flood control board — a board that is suing more than 90 oil, gas and pipeline companies — is set to discuss legislation affecting its independence.
State prison officials cannot keep secret the seller and manufacturer of the two drugs purchased for executions at the Louisiana State Penitentiary, a federal judge ruled Wednesday.
State lawmakers will not appeal a judge's ruling that it was improper to use $3.7 million from a probation and parole officers' retirement fund to balance the state's operating budget.
Conservatives have been losing their minds over this satirical bit on the Colbert Report.
The Lafayette Parish School Board leaves a lot to be desired, but is scrapping the election process in favor of an appointed board the answer?
The House approved legislation Tuesday night to roll back a recently enacted overhaul of the federal flood insurance program, after homeowners in flood-prone areas complained about sharp premium increases.
The NFL has formally designated New Orleans' Jimmy Graham as a tight end for the purposes of his franchise tag value, which is now set at $7.05 million next season unless Graham and the Saints subsequently agree on a long-term deal.
A federal appeals panel ruled Monday that businesses don't have to prove that they were directly harmed by BP's 2010 Gulf Of Mexico oil spill to collect settlement payments.
The Louisiana Department of Transportation and Development has closed Interstate 10 from I-49 in Lafayette to Seigen Lane in Baton Rouge.
Jim Bernhard, who engineered the sale of The Shaw Group for $3 billion, recently has told several people involved in Democratic politics that he intends to run for governor in 2015.
A New Orleans levee board wants to hold the oil and gas industry accountable for decades of damage to our state’s coastline, but the Legislature may be poised to put the kibosh on the suit.
New standards curb elective induction
CVS stops tobacco sales
If an Acadia Parish fiddler misses a note while swatting a fly, will a St. Martinville accordionist learn “Ma ‘Tite Fille”?
(It's good, it's bad and it's just crazy)