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2008 economic advantages for the Baton Rouge metro area:

• Projected job growth in 2008 and 2009, making the metro area fourth fastest growing behind Houma, New Orleans and Lafayette

• More than $6 billion in new construction, particularly in the petrochemical industry [the metro area has the largest concentration of chemical industry activity in the state]

• Federal GO Zone tax incentives motivating construction and reconstruction in the area and state

• Diversified economy including a strong public sector

• Projected population growth

1982-87: The Oil Bust

• The Baton Rouge metro area loses 4,800 jobs [2.2% of its work force] while the state loses 9%.

• Depressed oil prices, a chemical sector that dropped a third of its jobs and an OPEC crisis ignite Louisiana’s oil bust, causing an economic downturn from the 1980s to the 1990s, the worst in its recorded history. Some 148,000 jobs vanish.

• The U.S. economy, recovering from a deep recession since 1982, rebounds with sustained growth into the 1990s.

1988-00: The Good Years

• The Capital Region catches up to a stronger national economy, marking 13 consecutive years of growth. The area gains an average of 7,500 new jobs a year [1988 was the banner year with 10,300 new jobs].

• The Louisiana economy resurrects from the oil bust more diversified [strongly driven by chemical industry growth caused by renewed overseas demand from due to a weaker U.S. dollar]; the state marks stable recovery by the 1990s. Although energy prices recover, they remain highly erratic.

• Intense U.S. economic growth continues as new trade opportunities arise with the fall of the Soviet Union and technological advances in electronics.

2000-04: The Weak Years

• The metro area loses 3,900 jobs [1.1%] in 2001. In contrast, the U.S. economy lost jobs for three straight years. Slow growth in the chemical industry, a dominant section for the region, shrinks as the recession erodes sales and high natural gas costs increases costs. Many companies layoff workers or close temporarily, partially or completely, especially in ammonia plants.

• Louisiana enters its second recession in three decades, losing 22,100 jobs in 2001-02. It loses jobs for two years versus three years on the national level. The state is initially buffered by having fewer durable goods industries [typically first hit in a recession] and sustained activity in oil and gas until 2002, but its worst recession year comes in 2002.

• Cooling from the booming 1990s, the U.S. enters an anticipated recession.

2004-07: The Hurricane Effect

• The metro area economy is healthy. By September 2005, Hurricane Katrina deluges New Orleans sending more than 250,000 evacuees to this area [34% population growth]. The median house prices leap 27%. Sales tax receipts skyrocket 34%, and employment rises by 21,300 jobs.

• The state begins showing modest growth, slowed by lagging chemical and energy sectors. Hurricanes Katrina and Rita rip the economy, leaving some areas booming with evacuees and others struggling in recovery. Louisiana enters reconstruction aided by federal incentives. Debilitated energy production sends energy prices fluctuating wildly, but steadily upward.

• The robust U.S. economy, eroded by the subprime debacle and a major housing downturn, begins to slow down in late 2007. Recession worries surface and linger.

2008: A Soft Landing?

• LSU economist Loren Scott forecasts a “soft landing” for Baton Rouge metro area despite national recession worries. Scott projects about 2% job growth for 2008-09 with 7,400 new jobs this year and 7,500 jobs next year. Employment gains are running ahead of that forecast. BRAC projects 1.5% to 2.5% a year in job growth in 2008-10. Scott and the Baton Rouge Area Chamber point to refinery and chemical manufacturing expansions, strong state government revenues from high oil prices and construction job opportunities as growth drivers. Scott also singles out an estimated $6 billion in construction projects under way or planned, with many of them in the petrochemical industry. BRAC also projects population will grow to the 800,000 to 840,000 range this year and 810,000 to 855,000 range next year.

• Statewide, Scott forecasts 37,200 new jobs this year and another 37,800 jobs next year. Much of this growth could occur in New Orleans’ surrounding parishes from Katrina evacuees or people relocating.

• National recession worries intensify amid fears of surviving the subprime debacle and housing downturn. U.S. job growth expectations fall to 1%.