Holiday shopping is in full cry now, with the million twinkling lights along Canal Street in New Orleans marking a festive beginning to the Christmas season — even as south Louisiana’s economy faces some challenges, including low oil prices.
From the Riverwalk shops in New Orleans to the Mall of Louisiana in Baton Rouge, retailers said they are generally optimistic about the shopping season. The National Retail Federation predicts holiday sales will increase by 3.7 percent over 2014 figures, down slightly from the improvements seen in recent years. Spending rose by 4.1 percent in 2014 and 2013.
The month of holiday buying typically accounts for about 20 percent of retail sales. More of that, though, is online; this year, FedEx reported it expects a double-digit increase in packages shipped for the holiday season.
The Baton Rouge economy certainly is humming along, with growth in each of the nine parishes, reported Adam Knapp of the Baton Rouge Area Chamber in its 2016 forecast. “One of the great stories is not that we’re seeing job growth but that it is translating into earnings for households,” Knapp said.
Even an uptick in unemployment in the capital region appears to be from an increase of job seekers in the labor market, Knapp added.
Yet Baton Rouge is not the whole story, and a crash in oil prices since last year has clearly hurt in some parts of the state. The U.S. Department of Labor reported that Louisiana recorded the biggest loss among the states in payrolls, down 6,300. That loss was reported from October, as oil producers and oilfield service companies from Lafayette to New Orleans struggled after oil prices failed to rebound this year.
“If low oil prices continue, then we can expect to see greater impact on the state’s workforce, especially in areas dependent on the oil industry,” commented Curt Eysink, director of the Workforce Commission.
It’s difficult to argue with that.
While oil prices look to remain low for the foreseeable future, employment and incomes are buoyed by low natural gas prices, as well. That helps refineries and petrochemical manufacturers along the Mississippi and Calcasieu rivers in Louisiana.
Another reality is that low gasoline prices at the pump mean consumers have a little more flexibility to spend during the Christmas season.
That, we hope, will have retailers enjoying a bit more of the ho-ho-ho than the official statistics might suggest.