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The Atlanta Fed's SouthPoint offers commentary and observations on various aspects of the region's economy.

The blog's authors include staff from the Atlanta Fed's Regional Economic Information Network and Public Affairs Department.

Postings are weekly.


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03/03/2015


Tiny Bubbles in Alabama

Do you like to blow bubbles when you're chewing gum? I do. I recently discovered that bubbles are not just fun to blow when you're chewing gum—they can also be a fun and interesting way to visualize data. Yes, I said data. At the Atlanta Fed, we often use bubble charts to track and analyze certain data series. It is particularly helpful when we compare two bubble charts with the same information from different points in time.

In the charts below, which focus on Alabama, each bubble provides a static representation of a given value while also providing comparative information to other industries. The bubble size in these charts illustrates the most recent three-month average of jobs in that industry. The y (vertical) axis shows the three-month average annualized (or short term) job growth, and the x (horizontal) axis shows year-over-year (or long-term) job growth.

The chart is divided into four quadrants. A bubble in the upper-right quadrant (expanding) indicates positive movement in employment (both short- and long-term measures are positive), whereas the lower-left quadrant (contracting) indicates both measures are negative. The upper-left quadrant (improving) indicates the three-month measure is positive, but we're not seeing positive movement year over year. Lastly, the lower-right quadrant (slipping) is positive year over year, but the three-month measure is negative.

As you can see in the first chart, Alabama's leisure and hospitality employment in December 2013 was in the expanding quadrant. We interpret that as this sector has been making gains over the short and long run. This gain stands in contrast to the information sector, which contracted during both the short and long term, putting it firmly in the bottom-left quadrant.

alabama-momentum

Now, let's take a look at how some of Alabama's industries are doing. In December 2014, the leisure and hospitality sector was still expanding (gaining 8,800 jobs). According to the University of Alabama's Center for Business and Economic Research (CBER), the increase in leisure and hospitality is the result of staffing in food services and drinking places (restaurants, for example). CBER's Ahmad Ijaz said, "Restaurants are adding jobs all across the country."

The construction sector is in an even better position, moving from a contraction in December 2013 to expansion a year later. The Birmingham Business Journal, in an article from January 2015, said "Alabama is ranked eighth among the 50 states and the District of Columbia in construction jobs added." Likewise, the Alabama Department of Labor reported that Alabama "employment in the construction sector is at its highest point since November 2010."

Finally, a look at the manufacturing industry in Alabama also showed notable improvements. In 2013, it seemed like manufacturing employment was easing into the "slipping" quadrant, indicating a short-run slowdown. But 2014 saw it move firmly into the expanding quadrant. CBER's Ijaz tells us that this is the result of the automotive industry adding jobs from October 2013 to October 2014. He said that Alabama is one of the few states adding jobs in this sector. In September 2014, AL.com reported that Alabama's auto industry was projected to grow 2 percent in 2014 while the rest of the U.S. auto industry would contract about 4 percent.

alabama-momentum-2

So now that we've scrutinized past data, what are Alabama's employment projections for 2015? According to CBER's latest forecast, Alabama is expected to see stronger growth in employment in 2015 overall. I look forward to comparing bubble charts later in the year. In the meantime, I think I'll grab a piece (or two) of gum.

By Susan Remy, a Regional Economic Information Network analyst at the Birmingham Branch of the Atlanta Fed

March 3, 2015 in Alabama, Economy, Employment, Growth | Permalink

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09/09/2014


Small Business Lending in the Sunshine State

No doubt, the lending environment has changed since 2007. Local bankers from the South Florida market discussed some of those changes at a roundtable event held last month at the Miami Branch of the Atlanta Fed. The discussion focused on small business lending activity and how the outlook and behavior of small business owners have evolved since the recession.

The bankers said they have a strong appetite for what they termed "qualified" small business loans and noted that they were competing against each other for good opportunities. This environment has helped put pressure on financial institutions to provide competitive loan terms for small business owners seeking credit. Most of the banks indicated that small business lending was part of a diversification strategy and an important component of their business. In a quarterly senior loan officer opinion survey conducted by the Federal Reserve Board in the second quarter of 2014, loan officers reported easing lending standards and some improvement in small business loan demand relative to a year before (see the chart).

Senior_loanofficers

The roundtable attendees agreed with the survey's findings and noted that the pool of qualified borrowers is currently limited but may expand as banks continue to review their underwriting standards in an improving economic environment.

Although all of the participating bankers were actively engaged in making small business loans, they did indicate that businesses were generally hesitant to take on additional debt and in general were behaving very conservatively. In discussing why business owners were taking on less risk, it was noted that the effects of the recession were still fresh, and most of the bankers felt that uncertainty about the future weighed on the minds of business owners. In addition, findings from the Atlanta Fed's survey of business inflation expectations indicate that business activity for smaller companies is improving but remains below normal levels (see the chart). One banker noted that rising interest rates would indicate to business owners that the economy was strengthening and that rising rates may, in fact, prompt further borrowing.

Percent_abovebelow

Credit qualification often ultimately comes down to the fundamentals. From a credit perspective, the bankers indicated that they heavily rely on the "five C's" of credit to help evaluate loan applicants: character, capacity, credit, collateral, and capital. The roundtable participants described "character" as one of the most important variables when they consider a request. Companies that weathered the recession were viewed more favorably because it demonstrated the ability to manage a business through difficult times. An owner who has personal credit issues will generally imply potential problems in managing the financial aspect of a business. The bankers cited adequate cash flow and a good balance sheet as important credit qualifications. The lenders noted that they also analyze how businesses position their balance sheets and expenses incurred by the company not related to the business.

Overall, the sentiment among the bankers at the meeting was positive, and for the remainder of the year, they expect continued improvement in lending to small businesses.

By Karen Gilmore, a vice president and the regional executive at the Atlanta Fed's Miami Branch, and Marycela Diaz-Unzalu, a Regional Economic Information Network analyst, also at the Miami Branch

September 9, 2014 in Business Cycles, Economy, Growth, Jobs | Permalink

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05/22/2014


Are We There Yet?

If you’ve been reading the U.S. Bureau of Labor Statistics’ monthly Regional and State Employment and Unemployment press releases lately (and really, who hasn’t?), you may have noticed that Florida has been mentioned as one of the states with the fastest payroll growth. (In April, Florida had the third-largest payroll gain of any state in the nation, adding 34,000 payrolls across the state; this gain trailed only Texas, which added 64,100, and California, which gained 56,100 payrolls.) Indeed, during the last few months, the state’s payroll growth seems to have shifted into the next gear (see the chart).

Florida's Monthly Average Payroll Growth for Selected Time Periods


Florida has added just about 100,000 payrolls from January through April (97,900, to be exact), which seemed like a nice even number for an economic analyst to tear apart. Almost a third of Florida’s new payrolls so far in 2014 have come in the leisure and hospitality sector (see the chart). The professional and business services sector accounts for a little more than another quarter of the year-to-date job gains.

Sector Distribution of Florida's New Payrolls, January-April 2014 (SA, Thousands)


But still, a good bit left to go...
However, although the pace of payroll growth appears to be picking up for the state (and for the entire Sixth District as well; more on that shortly), in terms of the number of jobs there’s still quite a ways to go just to get back to where the state was prior to the recession. Florida’s payrolls peaked in March 2007 at just over 8 million; by December 2009, that figure was down to about 7.1 million. Incorporating April’s 34,000 new payrolls, the state sits at just shy of 7.8 million payrolls (see the chart).

Total Nonagricultural Payrolls: Florida (left) and Sixth District (right)


Between Florida’s last peak in payrolls and the level in April 2014, the state’s payroll gap is 274,000. Coincidentally, with eight months left in this year, if Florida’s payroll growth for the rest of 2014 continues at or slightly better than April’s pace, the state could ring in 2015 with a new level of peak employment.

For the Sixth District as a whole, the region is still down 444,000 payrolls from peak employment in March 2007, when the District had about 20.1 million payrolls. If April’s pace of aggregate District payroll growth (an increase of 62,400) held for the remaining eight months of the year, the Sixth District would also have a new level of peak employment by New Year’s Day.

Other highlights of the state employment report
Sixth District states added 62,400 payrolls during April, with 34,000 of those coming from Florida. Georgia had the second-largest gain within the Sixth District by adding 14,600 payrolls. Louisiana and Mississippi each added just under 5,000 payrolls (4,700 and 4,900, respectively), with Mississippi seeing its second month, with more than 4,000 jobs added each month since the U.S. Census surge in employment in 2010. Tennessee added 2,400 new payrolls, and Alabama saw 1,800 new payrolls.

The Sixth District aggregate unemployment rate ticked down to 6.4 percent in April, a result of declines in Florida, Mississippi, and Tennessee. Rates of unemployment stayed the same in Georgia (7.0 percent) and Louisiana (4.5 percent) and ticked up in Alabama (from 6.7 percent to 6.9 percent; see the chart).

Unemployment Rates for Sixth District States, and Sixth District Aggregate


The next regional and state employment and unemployment report will be released Friday, June 20.

Photo of Mark CarterBy Mark Carter, a senior economic analyst in the Atlanta Fed’s research department


May 22, 2014 in Employment, Growth, Jobs, Southeast, Unemployment | Permalink

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04/29/2014


Is the Southeast Poised for Tourism Growth?

The Atlanta Fed's Travel and Tourism Advisory Council met at the Miami Branch for the first time this year on April 17. Overall, council members were enthusiastic about economic activity, and its benefits for the tourism sector, in the Southeast.

Georgia and Alabama bounced back from harsh weather conditions in January and February. The outlook for the next three months is positive, with contacts reporting a strong number of bookings and ticket sales. Florida's tourism benefited from the winter weather with travelers seeking warm weather or extending stays as a result of cancelled flights. Fort Lauderdale, in particular, indicated record numbers in February and March.

The Southeast experienced an increase in international tourist activity in 2013, primarily from Latin America and Europe. Participants noted domestic travelers were travel fatigued and are staying closer to home. Consumer spending increased from a year ago, not only in hotel and food expenditures but in retail stores as well. The increase in spending came primarily from luxury restaurants and hotels.

On the horizon for regional travel and tourism
The council discussed the increase in capital expenditures across the region, reporting heavy construction activity in new hotels, sports venues, and other attractions in addition to renovations of restaurants, hotels, and convention centers.

Technology enhancements continue to significantly affect the industry and are being implemented across many segments of the industry. For example, customers can now complete ticket sales for theme parks, sporting events, and other entertainment events as well as reservations for dinner or special services such as spa treatments prior to traveling. Travelers can electronically handle requests for food orders, hotel check-in, beach chair reservations, and maintenance requests once they have reached their destination. (Don't be surprised to find yourself handed an iPad upon arrival at your hotel to facilitate check-ins and any other needs during your stay.)

Tourism markets expand
Interestingly, the council indicated that families are using children's sporting events—like traveling little leagues—as their family vacation. In response to this growing market, the industry is developing special venues and events for these groups to include family- and sports-oriented activities.

The state of Florida is promoting itself as a destination for medical treatment as a way to expand its customer travel industry. The state is proposing legislation to require VISIT FLORIDA, the State's official marketing corporation, to market Florida as a medical destination. Business contacts in the health care field are also heavily marketing health care in the state to countries with an underdeveloped health care sector.

All that said, the travel and tourism sector looks promising in the near term, and new industry developments should enhance the vacation experience for those about to visit the Southeast.

By Marycela Diaz-Unzalu, an economic and financial education specialist in the Miami Branch of the Atlanta Fed


April 29, 2014 in Alabama, Economic conditions, Florida, Georgia, Growth, Tourism, Travel | Permalink

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01/16/2014


The Beige Book Looks Rosy

The Federal Reserve released the first Beige Book of 2014 on January 15. To prepare the Beige Book—published eight times per year—each Reserve Bank gathers anecdotal information on current economic conditions in its district through reports from Bank and branch directors and interviews with key business contacts, economists, market experts, and other sources.

The first paragraph from the national summary began with this sentence:

Reports from the twelve Federal Reserve Districts suggest economic activity continued to expand across most regions and sectors from late November through the end of the year.

The Atlanta Fed was one of two Reserve Banks that saw conditions improve compared with the previous reporting period. Overall, we said that “[b]usiness contacts indicated that from late November through December overall economic conditions improved moderately in the Sixth District.”

Below are highlights from our report, beginning with the important sections on employment and inflation:

  • Businesses did not indicate a significant pickup in hiring, nor did they report any staff reductions. Businesses continued to employ technology and utilized overtime and contract labor as an alternative to increasing permanent staff. Contacts in manufacturing, construction, professional, and energy sectors report persistent difficulty in finding qualified workers. On balance, many firms expressed continued hesitancy caused by concerns about healthcare reform in terms of their overall hiring plans.
  • Cost pressures remained mostly stable, according to business contacts. Healthcare was the most cited exception, with reports of larger cost and price increases than usual. Merit increases remained in the 1 to 3 percent range. However, skilled and professional positions in energy, construction, information technology, and logistics continued to see above-average wage increases and higher starting pay. Year-ahead unit costs expectations were 1.9 percent in December, unchanged for the fourth consecutive month, according to the Atlanta Fed's survey on business inflation expectations.

Most sectors of the regional economy reported a solid start to the new year:

  • District merchants noted positive year-over-year holiday sales growth, with online sales outpacing traditional store sales.
  • The hospitality sector continued to experience the same solid pace of activity that it had all year long.
  • Residential housing brokers noted that existing home sales growth continued to slow, while homebuilders experienced modest growth in new home sales.
  • Commercial contractors described construction activity as improving, especially in the multifamily segment of the market.
  • Manufacturers indicated that overall activity strengthened since the previous report.
  • Capacity utilization in the energy industry remained near historic highs, and deep water oil exploration in the Gulf of Mexico increased.

Atlanta Fed business contacts held a positive outlook heading into 2014. Atlanta Fed President Dennis Lockhart shared this view in a speech delivered to the Rotary Club of Atlanta on January 13, where he said:

I expect the stronger pace of economic growth in the second half of 2013 to continue in 2014. My current view is that real GDP will expand between 2.5 and 3 percent this year, and I would not be surprised if we achieve results at the upper end of this range.

A new year often breeds optimism, sometimes misplaced. But based on our view of the data and what our business contacts are saying, we think that being optimistic this January is justified.

Photo of Michael ChrisztBy Michael Chriszt, a vice president in the Atlanta Fed’s public affairs department


January 16, 2014 in Economic Indicators, Employment, Growth, Housing, Inflation, Manufacturing, Prices, Productivity | Permalink

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10/31/2013


Acadiana Spotlight: Optimistic about Local Real Estate Conditions

You may recall that my Atlanta Fed colleague Rebekah Durham and I reported on housing conditions in southeast Louisiana in our July 22 SouthPoint post. I recently returned from another trip to Louisiana; this time, my colleagues from the Regional Economic Information Network at the New Orleans Branch of the Atlanta Fed invited me to join them as they touched base with real estate contacts in the Acadiana region, which encompasses the city of Lafayette and the surrounding parishes. I’m happy to report that our real estate business contacts were quite optimistic on both the residential and commercial real estate fronts.

Contacts indicated that the Lafayette area has experienced tremendous growth over the past year, thanks in large part to the energy sector. However, they were quick to point out that growth in the energy sector only serves as “four of the cylinders in an eight-cylinder engine,” as they described growth in medical, fiber, technology, and petrochemical fields as other drivers of growth. Business contacts mentioned that several companies are in the process of relocating high-paying executive positions as well as management positions to the Lafayette metropolitan statistical area. This growth has had quite a positive impact on the local real estate markets.

On the commercial real estate side, contacts reported that a fair amount of construction activity is taking place in the industrial and retail sectors, with considerable construction of medical office space also under way. Contacts indicated that this increased construction activity has been steady during the past year and a half and encompassed both existing firms wanting to expand their space and firms new to the area undertaking construction. Commercial real estate brokers expressed little to no difficulty in leasing existing space.

On the residential real estate side, business contacts reported that home sales are up more than 13 percent from a year earlier. Contacts indicated that the jump in mortgage rates seems to have raised demand more than it deterred potential buyers. Though new listings are up more than 17 percent year over year, contacts noted that the months’ supply of homes for sale dropped from 6.5 months to 5.3 months. Moreover, home prices have increased almost 2 percent from a year earlier, according to the Federal Housing Finance Agency’s quarterly house price index.

All said, contacts expect 2014 and 2015 to be even better than 2013 was. They pointed out that these large infrastructure investments by area businesses send a strong signal that the energy sector will not be leaving the area any time soon. As the nearby port expansions wrap up, more rigs come online, and manufacturing and petrochemical plants open their doors, business contacts are confident that an increase in real estate demand will follow.

Photo of Jessica DillBy Jessica Dill, senior economic research analyst in the Atlanta Fed’s research department


October 31, 2013 in Construction, Economic Indicators, Energy, Growth, Housing, Louisiana, Real Estate | Permalink

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10/29/2013


Tourism Update: Demand for Southern Exposure Remains Strong

On October 8 in sunny South Florida, the Miami Branch of the Atlanta Fed hosted our Travel and Tourism Council for the second semiannual meeting of 2013. Business leaders and hospitality industry experts spoke about current economic conditions and their outlook for the sector. The environment in the meeting was generally positive as each member shared news and plans for growth. The meeting took place during the partial federal government shutdown, so it was interesting to hear what effects if any the shutdown was having on the hospitality industry.

According to council members, the region’s hospitality industry has been growing at a reasonably fast clip as growth in business and leisure travel has more than made up for declines in government travel over the past year. Most contacts reported robust growth in tourism activity and anticipated that the fourth quarter of 2013 is likely to continue to be fairly strong, though it may not outpace the third quarter. South Florida in particular is enjoying an increase in visitors. According to a recent newsletter from the Greater Miami Convention & Visitors Bureau, demand for travel to Greater Miami and its beaches remained strong from January through September of this year, ranking fourth among the top 25 U.S. markets in both revenue per available room (RevPAR, a widely used industry metric) and average daily room rate. The area also ranked fifth in hotel room occupancy rates. Tourism professionals there have an optimistic outlook for the next year.

We heard from our council that hospitality employment continues to grow at a solid pace, especially in the hotel business. Firms are reportedly having little trouble finding qualified candidates to fill new positions. Consistent with reports from other sectors of the economy, the tourism industry is seeing a very high applicant-to-opening ratio, with applicants often considered overqualified for available positions. Apart from the ongoing problem of having difficulty attracting specialized skill sets or lower-skill workers willing to relocate to areas with a high cost of living, filling openings has been reasonably easy. (The cruise industry was a notable exception, where lower demand from U.S. and European travelers has prompted industrywide downsizing.)

Council members cited the hospitality industry’s two main concerns regarding the partial federal government shutdown: one was the increased time required at airports to clear customs and security, and the second was the closure of national parks. Some of our airport contacts did confirm longer security lines and longer times to clear customs. In many cases, tourists who had booked tours including visits to a national park shifted to visiting nearby privately owned alternatives. The government shutdown prompted the need for an overseas communication campaign. Since a large portion of southeastern tourism is international, the industry had to clarify any misunderstanding about the U.S. government shutdown, particularly to European tourists and booking agents. The general assumption was that a “U.S. government shutdown” is a full shutdown, similar to strike-related shutdowns that have taken place in other countries. The campaign seems to have been successful thus far; council members had not seen any tour or booking cancellations as a result of the government shutdown.

Council members’ outlook for growth over the next three months was strong as the winter season kicks off. According to our industry contacts, the first two quarters of 2014 are showing strong advance bookings in the hotel sector, and the growth outlook for the cruise industry is in the single digits. Overall, the outlook for 2014 is optimistic, though there was a tone of wariness about the impact of fiscal policy uncertainty on business and consumer confidence. For now, at least, the future is sunny and bright for the hospitality sector in the Southeast.

By Gloria Guzman, an economic and financial education specialist at the Miami Branch of the Atlanta Fed


October 29, 2013 in Employment, Growth, Southeast, Tourism | Permalink

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08/15/2013


Cleveland Rocks!

Readers of SouthPoint will recall my affinity for Cleveland’s professional sports teams. It’s been a long time since we have won anything (1964, to be exact; the year BEFORE I was born, by the way). But I’ll proclaim the drought partially over with Jason Dufner’s recent win at the PGA Championship. “Duf” is a Cleveland native, so I think that should count. He’s also lived in the Southeast and went to college here, so it’s a win for the Sixth Federal Reserve District as well.

Since I’m not a sportswriter, I’ll cut right to the point of the Cleveland link. It’s not really a link between Cleveland, Ohio, and sports victories. It’s a link between Cleveland, Tennessee, and economic victories.

According to data from the U.S. Bureau of Labor Statistics, the Cleveland, Tennessee metro area has experienced the largest increase in total employment (on a percent change basis) since the onset of the national recession in late 2007, at 7.8 percent. It appears that Cleveland is benefiting from its proximity to the Volkswagen auto manufacturing plant in Chattanooga and the rebound in national housing, which has increased demand for household durables—something that is benefiting the Whirlpool appliance manufacturing plant in Cleveland, as an Atlanta Fed publication recently noted.

Hinesville-Fort Stewart, Georgia, is next on the list with a 7.7 percent gain since December 2007. Much of that gain is no doubt tied to military base adjustments, as are the gains logged by Clarksville, Tennessee, and Warner Robins, Georgia. Nashville’s 6 percent increase is perhaps the most impressive and has the most impact, as it represents a net increase of 46,300 jobs. Knoxville is the other Tennessee metro area whose current employment levels are ahead of December 2007 readings.

In Louisiana, employment levels in the cities of Lafayette, New Orleans, and Baton Rouge are currently above prerecession levels. Alabama has two metro areas in positive territory: Auburn-Opelika and Tuscaloosa. Currently, Auburn is ahead of Tuscaloosa in terms of employment gains, and I will diplomatically refrain from making any analogies to college football...

The following table lists the region’s metro areas and shows the net change in total employment from December 2007 to June 2013 in terms of both total and percent change. What stands out is the fact that just 11 of the 65 metro areas in the region are at employment levels that are higher than they were in December 2007. It’s sobering to think that employment levels, although improving, are still so far below prerecession levels in most the of region.



That said, it is just as important to acknowledge that the region’s labor markets are improving. The chart below shows the level of total employment and the unemployment rate for the six states that are wholly or partially in the Atlanta Federal Reserve’s District (Alabama, Florida, Georgia, Louisiana, Mississippi, and Tennessee).



As Atlanta Fed President Dennis Lockhart noted in his August 13 speech to the Atlanta Kiwanis,

We have continued to see steady progress in economic fundamentals, in my opinion. Progress is evident, and we should not lose sight of that.

Photo of Mike ChrisztBy Mike Chriszt, a vice president in the Atlanta Fed’s public affairs department


August 15, 2013 in Employment, Growth, Nashville, Southeast, Tennessee, Unemployment | Permalink

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07/29/2013


Southeast Housing Update: Home Sales Growth, Prices Remain Positive; Inventory Shortages Persist

The Atlanta Fed’s monthly poll of regional brokers again indicates that home sales in June remained ahead of the year earlier level. Half of brokers reported that recent sales were in line with their expectations (see the chart).



Samplings of available Southeast Realtor group reports are not quite as positive as our contacts’ reports indicate (see the table); however, both sources confirm positive year-over-year growth.



A couple of brokers made an interesting observation: homes qualifying for 100 percent financing under programs such as the U.S. Department of Agriculture and the Veterans Administration were selling quicker than most in their area, leading these brokers to infer that many potential buyers lacked available savings to invest in a home purchase requiring a sizable down payment.

Reports from southeastern builders also continued to indicate sales gains on a year-over-year basis in June (see the chart). Nearly two-thirds of builders indicated that activity was in line with their plan for the period. Similarly, builders indicated that new home construction activity was slightly ahead of the year-earlier level in June. Builders continued to note growing pressure on margins from rising labor and material costs. There were more reports from builders on labor shortages and the challenge to find qualified workers. Most indicated that labor costs were up between 1 percent and 5 percent on a year-over-year basis.



Inventories remain low

Low home inventories continued to be reported across the Southeast and were considered by many contacts to be restraining home sales. Most builders and brokers reported that home inventories in June were below the year-earlier level. Data from the National Association of Realtors on home inventories confirms falling inventories on a year-over-year basis throughout much of the Southeast (see the table).



Contacts continued to indicate that shortages of available homes for sale were a major factor in the continued rise in home prices. There were several reports from across the region of multiple offers on homes with some selling above list price. Most contacts reported that new and existing home prices were up slightly from a year earlier (see the chart).



The outlook among housing contacts remained mostly upbeat, although some noted concern over rising mortgage rates and the scarcity of new home lots. However, the outlook for sales over the next several months is a bit more positive compared with contacts’ year-earlier expectations (see the charts).





Note: June poll results are based on responses from 44 residential brokers and 25 homebuilders and were collected July 8–17, 2013. The housing poll's diffusion indexes are calculated as the percentage of total respondents reporting increases minus the percentage reporting declines. Positive values in the index indicate increased activity while negative values indicate decreased activity.

If you are a real estate broker or homebuilder and would like to participate in this poll, please send a note to RealEstateCenter@atl.frb.org.

Photo of Whitney MancusoBy Whitney Mancuso, a senior economic analyst in the Atlanta Fed's research department


July 29, 2013 in Growth, Housing, Prices, Southeast | Permalink

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06/20/2013


Rebuild and Reshape

Nearly eight years ago, Hurricane Katrina devastated the Louisiana and Mississippi Gulf Coast. Most of the city of New Orleans was flooded in its wake, and the loss of life and property was tremendous. Having lived through these events, I can look back at the last eight years and feel the pride at what my city has accomplished since Katrina.

New Orleans has rebuilt and continues to reshape itself. As reported in the University of New Orleans Metropolitan Report, the New Orleans metropolitan statistical area population has steadily increased to 89 percent of pre-Katrina levels, to approximately 1.2 million residents (see the chart). In addition, the New Orleans unemployment rate in first quarter 2013 was at 6.4 percent, well below the national average, with major employment gains across several sectors of the region’s economy.

Louisiana and New Orleans region have taken advantage of post-Katrina opportunities, spurring entrepreneurs and business incubators such as Idea Village and becoming a mecca for talented young people moving to the region with jobs trending toward information services. A recent Forbes article ranked New Orleans as the number-one “brain magnet” in the United States in February 2011.

New Orleans is known for many things, including an affordable cost of living, low operating costs for businesses, state tax credits for leading industries, and the quality of life that young entrepreneurs seek. NOLA (as it is called by locals) also leads the state in tourism, hosting national events such as the 2013 Super Bowl, the 2013 Woman’s Final Four, and the annual traditions of Mardi Gras and Jazz Fest, which attract international crowds. Meanwhile, NOLA’s resurgence can be seen in rising commercial construction led by the robust biomedical industry, and urban renewal is driving residential development.

Louisiana and New Orleans have been very busy attaining accolades, and their growth and accomplishments contribute to the Southeast economy. Examples include:

  • April 2013: Bloomberg ranked New Orleans/Metairie/Kenner among the top 12 boomtowns in the country.
  • May 2013: Forbes ranked New Orleans the third-best city for the growth of information technology jobs (publishing, software, entertainment, data processing, and gaming).
  • May 2013: The Louisiana Small Business Development Center (SBDC) Greater New Orleans Region was named the top SBDCs in the nation, earning the U.S. Small Business Administration’s SBDC Excellence and Innovation Award.
  • May 2013: The Southern U. S. Trade Association and World Trade Center in New Orleans ranked Louisiana the number-five export state in the nation.
  • May 2013: A survey in Chief Executive Magazine ranked Louisiana the 11th-best state for business.

While the memories and lessons of Hurricane Katrina remain prominent in our minds, we all can share in the pride as the region continues to build a promising future.

By Gail Psilos, a director of the Regional Economic Information Network in the Atlanta Fed’s New Orleans Branch

June 20, 2013 in Economic Growth and Development, Growth, Natural Disasters, New Orleans, Recovery | Permalink

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