Local economists say sequestration won’t be devastating for La.

With little hope in sight that a compromise will emerge to stave off the massive federal spending cuts known as sequestration that are set to go into effect today, Louisiana is poised to lose tens of millions of dollars in federal funding that goes to schools, law enforcement, transportation, and a variety of other services. A White House report released earlier this week that outlines what the cuts will mean for each state paints a bleak picture of what the reductions will mean for Louisiana. But local economists are not panicking and doubt Louisianans will notice much change if and when the cuts take effect. “It’s not going to be devastating to Louisiana because we do not have that many federal workers here,” says LSU economist Jim Richardson, who notes that less than 2% of the state’s 1.9 million workers are federal employees. “That’s not to say individual families won’t feel the effects. If you’re the one who gets furloughed, it can be devastating. But overall, most people will not notice.” Richardson points out that Louisiana in general, and Baton Rouge in particular, have few significant federal installations that would be affected. Economist Loren Scott, for his part, notes that there are many unknowns at this point, especially since both sides are engaged in posturing and finger-pointing. Both experts say the biggest concern for the local economy is the possibility that the cuts cause a long-term national recession. “In that case, it will ripple down here,” Richardson says. “But we will be on the back lines of this, not the front.” —Stephanie Riegel