Acadiana’s economy was the focus as economic development and business leaders joined The Acadiana Advocate for a discussion about the area’s economic outlook Tuesday.
The overall tone for the 2019 Economic Outlook Summit was one of cautious optimism. According to Troy Wayman, president and chief operating officer of One Acadiana, and many other panelists, things are looking up for the Acadiana region’s economy.
There may be over $300 million in capital investment coming to the region in the near future, Wayman said, based on projects nearing the end of negotiations. He also said the region’s economic diversification, citing the expansion of Lafayette General, LHC Group and Stuller, as well as newcomers like CGI and Waitr, should bring an end to double-digit unemployment whenever the oil industry has a bust period.
However, there is some uncertainty looming as a result of the ongoing tariff negotiations with China. Phillip May, president and CEO of Entergy Louisiana, said tariffs create uncertainty, and businesses do not like uncertainty. “The sooner we resolve these tariff issues, the better off Louisiana and the United States will be,” he said.
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Of course, the oil and gas industry was a major topic of discussion.
While things are looking up in some sectors, Bill Fenstermaker, chairman and CEO of Fenstermaker & Associates, said oil and gas revenues have dropped about $750,000,000 a year for the past three years. He suggested the current administration’s policies could be causing Texas oil companies to avoid drilling in Louisiana, especially in the Gulf of Mexico.
However, while many experts believe oil will plateau around $80, Fenstermaker said he expects the price to increase, possibly back to $100 a barrel in the next three to four years.
This is why economic development leaders emphasized the importance of diversifying along with with oil and gas and not abandoning the vital sector of the state’s economy.
Two areas that still need work, according to several panelists, are infrastructure and workforce education and development.
Infrastructure improvements are needed to make business development feasible, according to Flo Meadows with Latter & Blum Realtors. Last year, she said, Acadiana saw a 250 percent increase in new commercial construction permits. Major developments such as the redevelopment of the old federal courthouse in Lafayette, the airport renovations, CGI and Waitr’s expansions could lead to a similarly good year in 2019, she said.
David Callecod, president of Lafayette General Health, also emphasized the need for more infrastructure to deal with economic growth. While LGH is working to expand to provide more doctors and specialists to help manage new people on the post-expansion Medicaid rolls, he said, the Oil Center is at capacity for dealing with sewer and water and they can’t utilize the area near the hospital effectively.
Wayman said One Acadiana has been working on infrastructure improvement strategies to propose to local and state governments, but getting the $1.5 billion needed to pull it off is another challenge entirely.
Educating the next generation of workers through South Louisiana Community College and the University of Louisiana at Lafayette was another key point raised by business leaders, as well as Natalie Harder, chancellor of SLCC, and Joseph Savoie, president of UL.
Harder spoke at length about the two-pronged approach SLCC has to take while both serving its students by creating a path toward a career, but also by serving the businesses and industries of Louisiana by providing them with trained and knowledgeable employees.
She also said looking to the community colleges could be a proverbial “canary in the coal mine” for those looking to see where growth and the economy may be headed.
Savoie said another problem they face is getting students to complete post-secondary education. While Louisiana has a decent enrollment rate, the completion rate sees only half of those who enroll actually finish their course of study.
Savoie and Matt Sias, owner of MSJ Insurance, both stressed the need to get underserved communities in the know about their higher education options as underserved and minority communities don’t know what’s out there for them to learn and turn into a career.
“Education has never been more important in this modern economy than it is right now,” Savoie said. “Some form of post-secondary education is needed if you want to participate in this economy.”