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Wednesday, October 26, 2016

Report: Gulf Coast Economic Recovery Remains Mixed

October 10, 2006

Employment statistics, sales tax collections, large construction projects and other key economic indicators point to an accelerating recovery in many Gulf Coast communities damaged by hurricanes Katrina and Rita in 2005.

Economic growth driven by construction and manufacturing in Pascagoula, Miss., and Lake Charles, La., parallels the aggressive recovery patterns that most regions encounter following a major natural disaster. Yet despite these improvements, the economic impact of Hurricanes Katrina and Rita continued to negatively affect key cities in the Gulf Coast region through the second quarter of 2006. Floodwaters from Hurricane Katrina, widespread lack of flood insurance and the ensuing slow-paced development of programs to aid housing repair or replacement are key reasons for slower recovery in two parishes, Orleans and St. Bernard. These results are reported in "Advancing in the Aftermath III: Tracking the Recovery from Katrina and Rita," a study by noted economist Dr. Loren C. Scott and sponsored by Capital One, N.A. Economic recovery is accelerating in heavily damaged Biloxi-Gulfport, Miss., where programs have been implemented to assist homeowners and businesses rebuild. By contrast, planning such aid programs took much longer in the New Orleans area, where flood waters that lingered for weeks heavily damaged large portions of Orleans and St. Bernard parishes. Residential grant programs in those areas were only recently finalized and the distribution of funds is just beginning in New Orleans.

On Mississippi's Gulf Coast, Scott pointed to casinos in Biloxi-Gulfport and shipbuilding in Pascagoula as examples of progress. Scott said that legislation allowing casinos to be built along the shore rather than on the water and Gulf Opportunity Zone assistance programs provide strong incentives to accelerate rebuilding and new casino developments. The report also cites University of New Orleans research findings that construction projects in the New Orleans area which would normally provide 28 years-worth of building activity are currently scheduled for completion in just the next few years. Overall, the report states that large industries and manufacturers, including shipbuilding operations and ports, have recovered faster than small businesses. For example, in Pascagoula, Northrop Grumman (NOC)'s Ingalls Shipyard has new Navy contracts, and its total employment is just 1,000 jobs short of its pre-Katrina employment peak of 13,000.

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