LOUISIANA | #13 | HAMPERED BY FUEL DEPENDENCY
Cheaper energy costs hammer fuel-dependent economies like Louisiana’s. Choked corporate revenues cause pain in public sectors, and revenue shortfalls led to state budget-tightening. This summer, Louisiana’s incentive programs were sliced about 20 percent.
Still, the state reports success stories. A bright spot is the I-10 corridor and regions south of it. Chemical companies headquartered there take advantage of higher prices in Europe, winning new export customers in volume. Emerging export markets and drilling opportunities in Mexican waters may benefit Louisiana energy interests. The two-parish Lake Charles Metropolitan Statistical Area has logged over $81.7 billion in recent industrial announcements, a figure “seven to 10 times larger than we would typically report for the whole state in the past,” say economists Loren Scott and James Richardson, authors of the Louisiana Economic Outlook: 2015 and 2016.
Getting a foothold in the Pelican State can be daunting. While Gov. (and presidential aspirant) Bobby Jindal personally gets plenty of positive reviews, the state’s shady legacy deters some relocation advisors. Louisiana “is not as corrupt as it used to be, but it is very political,” says Cushman’s McIntosh. Says Ginovus’s Gigerich: “The way Louisiana functioned, if you knew somebody things happened.”
The Tax Foundation ranks Louisiana’s tax burden 5th lowest and its business tax climate 35th. Louisiana spends over $1.8 billion per year on incentive programs.
ALABAMA | #21 | EDGING INTO AUTOMOTIVE
One of the few states in the nation that’s added manufacturing jobs, Alabama’s economy reflects the generational shift away from textiles in favor of automotive and aerospace. The state is paced to add between 30,000 and 35,000 jobs this year, according to the Center for Business and Economic Research at the University of Alabama.
Government efforts to promote such advanced manufacturing and high-tech growth companies have borne fruit. Alabama’s successful wooing of Airbus brought its aerospace sector international prominence, joining Boeing in a growing cluster. A new focus on attracting pharmaceutical and related industries shows promise. Companies like these require a trained workforce, something Alabama is addressing with educational reforms.
Research conducted by the Culverhouse College Center for Business forecasts GDP growth of 2.3 percent this year and 2.5 percent next, following two years of 2 percent growth. The Tax Foundation ranks Alabama’s tax burden 10th lowest and ranks its business tax climate 28th. Alabama spends over $277 million per year on incentive programs.