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Labor shortage years in the making

NEW ORLEANS (AP) — About the time Louisiana needs plenty of workers — especially skilled craftsman to rebuild from hurricanes Katrina and Rita — there’s a labor shortage looming over almost all of the economy.

With 75,000 new jobs forecast over the next two years, this twist in the state’s employment picture is partly the product of the oil bust of more than 20 years ago, aggravated by population reductions and shifts caused by the 2005 hurricanes.

Now that oil prices are at record highs and billions of dollars in construction projects are popping up, employers are scratching their heads wondering where enough workers will come from.

Many might be waiting for a long while. The problem isn’t just rooted in the hurricanes, and, like most systemic issues, there’s no quick, convenient solution.

According to the annual two-year job forecast composed by a group of state university economists, the collapse of oil prices from 1982 through 1987 ran off a good portion of Louisiana’s potential workforce. Many who could be contributing today weren’t even born when their parents packed up and left Louisiana as opportunity dwindled in the mid- and late 1980s.

It was understandable. During that six-year period, the state lost 148,000 jobs — about 9 percent of the workforce. It was the start of an economic erosion that continues to this day.

Now, the kids of that generation are looking for work, most outside Louisiana. Toss in a population scramble resulting from Katrina — especially in metro New Orleans — and the question of who will fill the jobs becomes sticky.

Louisiana demographer Elliott Stonecipher says it shouldn’t surprise anyone who’s been paying any attention for, well, at least the past 20 years.

Between 1987 and the 2005 storms, relatively little economic growth in the private sector happened in Louisiana that wasn’t tied to tourism or legalized gambling. Busts in oil, banking and insurance gave workers ample reason to go elsewhere in search of good-paying jobs.

Katrina sped up the process.

“Younger people looking for jobs or better jobs have constituted a large part of all migration and certainly Louisiana’s outmigration problem,” Stonecipher said.

And the worst may be yet to come.

The economic forecast said that around 2005-06 — the time of Katrina and Rita flattened southern Louisiana — Baby Boomers started moving into retirement and the number of new residents entering the workforce began to decline.

“From a labor market standpoint, Louisiana is taking a lick both coming and going in its labor market,” the forecast said.

The forecast suggests the potential worker shortage will mean:

• Sharp wage increases in Louisiana. It’s a seller’s market for workers.

• Some older workers will stay on the job longer, lured by higher pay.

• Some work may be outsourced as companies struggle to find local workers.

• Immigrant labor, already at work in the hurricane construction zones, could increase.

The immediate push is for skilled construction workers to handle several billion dollars worth of new projects on the books, ranging from levees, highways, bridges, industrial expansion and new and revamped buildings, both public and private.

But Stonecipher says immigrants won’t solve labor needs in all sectors of the state’s economy.

For example, Shreveport-Bossier City, Stonecipher’s home turf, hopes to land the Air Force’s Cyberspace Command — designed to defend strategic computer systems against electronic warfare. Projections say that could bring to the region 10,000 to 15,000 jobs with annual payroll of at least $750 million.

Although the salaries might be high enough to attract employees, there’s potentially bad news there, especially if the criteria for awarding the project includes an immediately available, high-skilled, white-collar civilian payroll. That labor force largely is long gone from northwestern Louisiana, Stonecipher said.

“That is the ultimate paradox or irony. What we have to have to turn the corner is white-collar jobs and everything that goes with them. That is precisely our greatest weakness,” Stonecipher said.

And whatever the solution is — a revised tax system, better education or whatnot — it’s eluded government for two decades. Now, it’s an extremely inopportune time to be playing catch-up with much of the needed next generation of workers somewhere else.