Note: This article originally appeared in the Monroe News Star on Oct. 25, 2021. 
Written by Sabrina LeBoeuf

Louisiana lost nearly 30,000 jobs from August to September; Hurricane Ida only accounts for part of the drop

Preliminary state employment data for September shows a loss of nearly 30,000 seasonally adjusted non-farm jobs from August, and though this is partly due to the impacts of Hurricane Ida, the storm doesn’t account for the overall shift in employment.

Louisiana’s September numbers detail a large chunk of job losses in the New Orleans Metropolitan Statistical Area, but there are losses in other parts of the state that did not experience any hurricane damage, according to Patrick Scott, Louisiana Tech University assistant professor of economics and director for the Center for Economic Research.

‘Something bigger than Hurricane Ida’

“Clearly, this is something bigger than Hurricane Ida,” Scott said. “Now, whenever New Orleans gets a sniffle, the state gets cold, and that’s traditional when it comes to employment — it’s such a large MSA…But there’s other job losses happening.”

Hurricane Ida made landfall as a Category 4 storm on Aug. 29, the 16-year anniversary of Hurricane Katrina. While Southeast Louisiana experienced the brunt of Hurricane Ida, northern cities like Shreveport were spared the torrential rain and wind. Nonetheless, every metro area except for three — Alexandria, Monroe and Lake Charles — lost jobs from August to September. Shreveport lost 1,000 jobs, Lafayette lost 1,600 jobs and Houma lost 3,800 jobs. New Orleans employment dropped the most with a loss of 22,700 jobs.

About 41,000 people filed unemployment claims from Aug. 29 through September, according to the Louisiana Workforce Commission. Throughout August and September, weekly continued unemployment claims for the state drifted between roughly 30,000 and 41,000.

Scott said these losses took place within a larger picture of economic stagnation. According to the 2021 Louisiana Economic Abstract, an annual report by the Center for Economic Research, the state is down roughly 144,000 jobs from pre-pandemic levels. Additionally, these losses are partly due to approximately 81,000 people completely leaving the labor force and no longer choosing to seek employment. Possible reasons for leaving the labor force include feeling discouraged, retiring and not having enough incentive to return to work, Scott said.

“Until we reengage that portion of the labor pool, we’re not going to fully recover,” Scott said. “That’s the key. If we’re going to be formulating a policy, that’s going to be where we need to start targeting our policy.”

The decrease in labor force participation has helped contribute to the decrease in unemployment rate, which is calculated by dividing the number of unemployed people by the size of the labor force and multiplying that quotient by 100. Louisiana was one of 27 states to see a lowered unemployment rate of 5.8%, which dropped 0.4 points from August and 2.2 points from last year. Scott said this is because the denominator of the fraction is changing, not because there are more unemployed individuals finding work. 

The stagnation can also be seen at the local level. Most metropolitan statistical areas, or MSAs, except for Houma and New Orleans, gained jobs from September 2020 to September 2021. However, the MSAs that continue to see employment growth are Lafayette, Hammond and Alexandria. The rest are tapering off.

Scott said Alexandria is the closest to employment recovery, but this could be because the MSA is small and has fewer jobs to recover. According to the 2021 Louisiana Economic Abstract, Baton Rouge, Lake Charles, Monroe, and Shreveport have “struggled” to regain half their employment losses.

Lasting effects

Scott said Hurricane Ida did wreak havoc on many people’s lives and continues to have lasting effects, but he said the storm that more closely resembles the level of impact that COVID-19 has had on the state economy is Hurricane Katrina. COVID economic recovery is expected to mimic Katrina’s past trend, meaning improvements will be anything but quick.

The LWC reported the leisure and hospitality industry had the largest year-over-year gain for seasonally adjusted jobs at 12,500. Scott said this should do well for the New Orleans area. 

Recovery is also dependent upon pandemic recovery, Scott said. He said people have reached a state of complacency with COVID, and those who have wanted to receive vaccinations have already done so. 

“Until we get more people vaccinated, this virus is still going to continue to mutate; it’s still going to pose a threat even to the vaccine efficacy that we already see, and that’s a problem, too,” Scott said. “We’re in for a really slow recovery.”