Gustav effect hurts Oct. jobs

• By GARY PERILLOUX
• Advocate business writer
• Published: Nov 26, 2009 - Page: 1A

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Technically, Louisiana put 4,700 more people back to work in October.

A longer look shows inertia at work, too.

Toss out the two Octobers when the state recovered after hurricanes Katrina and Rita, and the latest nonfarm employment figure from the Louisiana Workforce Commission — 1,910,800 people at work — stacks up as the worst October since 2002.

Factor in a national recession and Louisiana finds itself 44,000 jobs behind October 2008.

But there’s an anomaly at work here, too, state officials said.

The state’s job picture might look much brighter beside 2008 were it not for Hurricane Gustav. The storm landed in early September 2008 and plowed 27,000 new jobs into the Louisiana economy the following month when cleanup and rebuilding continued.

That’s a growth rate 22 times the annual average for Octobers in this decade.

“The October over-the-year decline (of 44,000 jobs) is due in part to the uncharacteristically large increase in 2008,” said Curt Eysink, the state Workforce Commission’s executive director, in a statement.

While economists point to a 2.9 percent growth rate in U.S. gross domestic product for the third quarter, the strongest economic growth in two years, expectations for job recovery are rising as a nearly two-year recession appears to be over.

But such expectations can be foiled by the lag time in which companies and public sector employers scrutinize the economy and decide when to begin reinvesting in workers, facilities and programs, said Donald Andrews, who’s dean of the Southern University College of Business.

Jobs are a trailing indicator, he said, meaning employers begin slashing payrolls after they find out the economy is bad. By the same token, they won’t begin rehiring significantly until they’re sure the recovery is real.

“We avoided the worst,” Andrews said of Baton Rouge and Louisiana, generally. “And we’re seeing first-time job claims decreasing. As long as that continues on the way down, and along with the investments various sectors can make, particularly the government sector, that can give the private sector time to recover.”

Louisiana’s October employment report, released late Tuesday, shows the state with the 15th-best jobless rate. The seasonally adjusted national unemployment rate rose from 9.8 percent in September to 10.2 percent in October.