As state officials boast of record low un-employment and big job gains, a U.L.-Lafayette economist says the state could lose thousands of jobs in the coming months, amid an economic downturn. ULL’s Dr. Gary Wagner says inflation is the reason. As interest rates rise to combat inflation, businesses see costs increase and the need for budget and payroll cuts in the months to come…
“…and I think growth in Louisiana is going to be flat to slightly negative over the next year…which translates into job losses of around 2400 as my best estimate,” he says.
The state Workforce Commission recently posted big job gains and low unemployment figures from the early summer. Wagner doesn’t dispute that, but says the developing “economic malaise” in the state economy will surely impact employment…
“In the last three months the state gained 2700 jobs, compared to 16-thousand jobs in the preceding 6-month period. So, a significant slowdown in the last three months.”
Wagner says the root problem is the rise in interest rates, to help stem the tide of inflation. He says the cure, in this case, can be as bad as the sickness…
“It makes it more costly for people to buy – especially big ticket items. It makes it more costly for businesses to invest. It makes it more costly to buy homes. And all of these tuypes of activities are all slowing down.”
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