Louisiana enters 2026 on firmer footing than in recent years, but there is still work to do to make sure the state is connecting the dots between big economic development opportunities, according to Stephen Barnes, associate professor of economics at UL Lafayette and executive director of the Kathleen Blanco Public Policy Center.
“What {connecting the dots} looks like is how to make sure we don’t just have one new employer that can hire a few 100 people, but that project after project, we’re doing the things in our cities and towns to make sure we’re creating the communities and the full economic ecosystem that attracts people to Louisiana,” Barnes says.
Barnes, who spoke at Wednesday’s Rotary of Baton Rouge meeting, says Louisiana has finally surpassed its prepandemic employment level, with job totals holding above 2 million for several consecutive months. That marks a milestone after a slower recovery than most states as a result of its heavy reliance on tourism, hospitality and the oil and gas sector.
While job growth has resumed, Barnes notes that Louisiana continues to lag nationally, raising concerns about the state’s long-term competitiveness.
Inflation remains a key factor shaping household finances and policy decisions. Price growth has eased from pandemic highs but remains above the Federal Reserve’s 2% target. The impact has been partially offset by personal income growth, which in recent years has slightly outpaced inflation. That dynamic has helped sustain consumer spending and tax collections, though Barnes warns it also contributes to the persistence of inflation.
National forecasts point to “good, but not great” economic conditions in 2026, with real GDP growth around 2% and inflation staying elevated in the upper-2% range. Barnes says uncertainty remains high due to tariffs, oil, exchange rates and upcoming changes in Federal Reserve leadership—all factors with implications for Louisiana’s export-heavy economy.
“We can appreciate the steady pattern of growth that we have experienced and we can expect more of that to come in 2026, but we need to keep leaning in and working hard, not just at a state level, but at a local level, to make sure that we reach further to accelerate growth.”
