Wednesday, February 28, 2024

Forecast: Louisiana’s economy won’t make full recovery until next year at earliest

by BIZ Magazine

By David Jacobs | The Center Square

Louisiana’s economy will return to pre-COVID-19 levels late next year at the earliest based on the current pace of recovery, according to a new forecast.

Gary Wagner, a business economist at UL-Lafayette, produces the quarterly Louisiana Economic Activity Forecast. In his newest report, he said the outlook for key economic indicators is as strong as it has been in a year after the state gained more than 44,000 jobs during the last three months of 2020.

Every metropolitan region of the state added jobs last quarter. Wagner expects that trend to continue over the next five quarters, leading to more than 56,000 additional jobs statewide.

“Despite the improved outlook, a full recovery for most economic indicators in the state is (now) not expected until late 2022 or early 2023,” he said. “The unemployment rate remains stubbornly high as both initial and continued unemployment claims remain well-above historical norms.”

Through the end of last year, the number of jobs in the state was more than 90,000 lower than the 2019 fourth quarter average of just under 2 million. The number of people employed part-time involuntarily exceeds 88,000, the highest number in nearly two decades, Wagner said.

Wagner’s baseline projection is for 46,000 jobs to be added in the next four quarters. At this pace, Louisiana will not regain all of the COVID-19-related job losses until the fourth quarter of 2022, he said.

The baseline projection also shows the unemployment rate falling gradually, not reaching its pre-COVID-19 rate of 5.2% until mid-2023.

After rebounding in the second half of last year, gross domestic product is expected to grow slowly, possibly reaching pre-pandemic levels in late 2022 or early 2023, Wagner’s forecast indicated.

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