SHREVEPORT – If the local economy were a car dashboard, there aren’t any flashing check engine lights are other indications of major problems.
But Douglas White, the director of the LSU Shreveport Center for Business and Economic Research that produces quarterly reports on the local economy, said he’s not seeing strong growth either.
“We seem to be muddling through,” White said of the third quarter economic dashboard released this week. “It’d be better if we saw some really strong growth, but at the same time, there doesn’t appear to be any real chance of a recession.”
Third-quarter data gathered by White was largely unaffected by the federal government shutdown with just September data for unemployment and building permits unavailable.
The Shreveport-Bossier unemployment rate read 4.3% in August, which is steady decline from the 5% recorded in June.
The national unemployment rate for September ticked up to 4.4%, which was announced Thursday.
“Looking back at previous years, locally we’ve typically had a spike in the summer and then come back down a bit,” White said. “(The Federal Reserve) cut interest rates in October (for the second time this year) because they were starting to be concerned about unemployment, and I was a little surprised that they decided to cut interest rates again.
“We were headed toward a definite rate cut in December, but now that probability has gone down because we don’t have the data.”
One reason not to cut interest rates in December is a persistently high inflation rate, with core inflation climbing 3% in September year-over-year and the overall inflation rate sitting around 3%, even though its growth has slowed.
“Inflation is higher than The Fed would like it to be as it remains higher than their target of 2%,” White said. “I’ve been telling my (macroeconomics) class that just because the inflation rate slows down and it’s not growing at 8-9% percent like it was, that doesn’t mean prices are coming down.
“They are just growing more slowly from that already inflated base. Inflation is still the number one reason that people aren’t happy with the economy because prices are high. Three percent isn’t terrible, but it adds up pretty quickly because you’ve reset prices about 20 percent higher (since before the COVID-19 pandemic).”
White will be interested to see how higher prices affect holiday shopping and travel.
Two local sectors that continue to expand are airport and casino revenue.
The 217,760 passengers that used the Shreveport Regional Airport in the third quarter (18 percent increase from 2024 third quarter and 29 percent increase from 2023) continue to show strong growth.
The overall casino market continues to expand, up 9.3 percent overall in the third quarter year-over-year.
The introduction of Live! Casino in February appears to have expanded the sector instead of cannibalizing the existing players – so far.
“If the economy is really doing poorly, you’d expect to see some pull back in those areas, and we aren’t seeing that,” White said. “But I think there’s some truth to the ‘K-shaped economy’, where the upper half of people are doing well and the lower half are not.
“So you can have overall economic numbers that look fine, but you have a lot of people who are angry about higher prices and aren’t going to view the economy well.”