Hurricane Katrina’s initial stresses on the Baton Rouge area, a shortage of housing for the displaced and even worse traffic, have given way to a closer relationship with New Orleans and increases in employment and personal income, according to a report from the Baton Rouge Area Chamber.
“In short, the uniform rise in population, income, jobs and industry activity in the wake of such a terrible disaster not only demonstrates the resiliency of the region’s residents, but also portends great progress for the Capital Region going forward,” the report says.
The most “noteworthy” economic indicator since the 2005 storm may be the rise in income, particularly among African-Americans, according to the chamber. The metro area’s median individual income, adjusted for inflation, rose 21 percent from $22,177 in 2005 to $27,059 in 2013. Nationally, individual income grew by 12 percent over the same time.
Median individual income for black workers has grown 32 percent, “an astounding rate” and more than double the national average, according to BRAC.
Economist Loren Scott said the underlying data for the changes to black workers’ income will require a lot more study.
“But my first thought was for that to have happened in such a short period of time, it seems to me like it would have to be due to in-migration of higher-income African-Americans from the New Orleans area,” Scott said.
There have been a lot of big industrial projects, which would also help, Scott said. But most of that work took off after 2013, the last year of data in the chamber’s report.
Chamber President and Chief Executive Officer Adam Knapp said another surprising finding from the report is that crime rates are lower now than before Katrina.
“It runs counter to the perceptions of many,” Knapp said.
The report says crime rates initially surged but have fallen since 2009, when homicides peaked at 75. In 2014, there were 53 homicides. Aggravated assaults have fallen from 1,558 in 2009 to 1,142 in 2014.
Donald Andrews, dean of Southern University’s College of Business, said while progress has been made, there is still lots of room for improvement. Those steps include finding ways to provide more opportunities for children living in poverty to educating people about health care.
“The murder rate in Baton Rouge is something we should really try to find some solution to,” Andrews said.
The metro area must improve its residents’ quality of life if it wants to attract more people to the community, he said.
Meanwhile, Knapp said, the business communities of the Baton Rouge and New Orleans metros are now bound together through a Super Region Committee. The committee had no formal name until five years ago, but the committee now meets every other month. The Super Region added the Houma-Thibodaux metro area about a year ago.
The Super Region members collaborate on business development strategy, such as efforts to grow the software sector, Knapp said. This year for the first time, the chamber’s annual trip to learn how other regions coordinate growth strategies included representatives from the greater New Orleans and Houma-Thibodaux metro areas.
In June, BRAC and Greater New Orleans Inc. attended a trade show in Frankfurt, Germany, in an effort to recruit European companies in the chemical industry supply chain, Knapp said. BRAC-GNO has already hosted their first prospect, who is thinking about locating a manufacturing facility somewhere in the Super Region.
Andrews said the economy benefitted from the federal hurricane recovery dollars that poured into the area.
The recovery of New Orleans and Baton Rouge’s growth demonstrate that the government can be the source of solutions, Andrews said. Hopefully, New Orleans and Baton Rouge can continue working together because the state needs a major metro area to attract the more desirable industries.
The regional approach to economic development can accomplish a whole lot more, such as a major airline hub or a regional distribution center, Andrews said.
The chamber report’s other findings include:
Employment for the Baton Rouge metro area increased by 64,300 nonfarm jobs since Hurricane Katrina hit in August 2005, according to data from the Louisiana Workforce Commission. Total nonfarm employment for the area has grown from 339,400 jobs in August 2005 to 403,700 in June 2015. The service-providing sector added 33,300 jobs over that time; construction, 21,500 jobs; education and health, 14,400; professional and business services, 11,400; and leisure and hospitality, 7,400.
Traffic and congestion remains “a critical issue” for the area. The Baton Rouge area gained 58,000 residents in 2005, roughly seven years of growth and an amount the Capital Region could not plan for or adapt to.
The Baton Rouge area’s traffic congestion ranked second-worst among mid-sized cities between 2005 and 2011, according to the Texas Transportation Institute. Congestion costs increased $118 million per year to $424 million.
Scott said some major expansion projects on interstates 10 and 12, which widened to six lanes some heavily-traveled stretches, have been completed since the most recent data in that report.
“Still we’ve got a problem that seems to me is always mainly associated with the stinking bridge (over the Mississippi River),” Scott said. “It hasn’t changed. It hasn’t been expanded.”
The “new” bridge may be the biggest bottleneck on I-10 in the country, Scott said.