The plunge in oil prices may be taking a toll on some states’ economies—including Louisiana—but lower energy costs also are spurring a surge in manufacturing here and in many other states.
As The Pew Center for Charitable Trusts reports, the change can be seen in new gross domestic product, or GDP, numbers for states released last week by the U.S. Department of Commerce Bureau of Economic Analysis.
The data shows Louisiana was among 41 states that saw economic growth in 2014 compared to the year before, when measuring GDP per capita and adjusting it for inflation. It was down in nine states and the District of Columbia.
The manufacturing of nondurable goods, such as plastics and chemicals, was a major factor in driving the growth across many states, and nowhere more so than in Louisiana. Chemical manufacturing, fueled by low natural gas prices, helped drive the growth. Natural gas is a building block for many fertilizers, chemicals and some plastic products. As a category of economic activity, manufacturing of nondurable goods increased 4% nationally in 2014 compared to 1% the year before.
“Nowhere was the growth more apparent than in Louisiana, which saw 12% growth in nondurable manufacturing from 2013 to 2014,” reports The Pew Center. “In southern Louisiana, about $50 billion in investment in chemical plants along the Mississippi River has been announced in the last several years. As a result, the state’s economy has experienced one of the biggest turnarounds.”
In Louisiana, the data shows per capita GDP was $54,968 last year, up 1.4% over the 2013 figure. The turnaround is particularly impressive when you consider that Louisiana’s per capita GDP was down 3% in 2013 compared to the 2012 figure. Louisiana’s per capita GDP was slightly higher than the national average of $54,307. Alaska had the highest per capita GDP, at $77,477, while Mississippi had the lowest at $35,019. The District of Columbia was higher than any state at $175,253.
The figures released last week show Louisiana’s total GDP grew by 1.9% in 2014, lagging nationwide growth of 2.2%. Louisiana’s $251 billion economy ranked 19th among the states for growth, with North Dakota growing the fastest.
Read the full story and see per capita GDP figures for all states.
