Is a Louisiana Recession Coming?

Is a Louisiana Recession Coming? Economist Says No—for Now 

Despite some national chatter and gloomy headlines, Louisiana is not heading into a recession this year, at least not according to one of the state’s most trusted economists. 

Dr. Loren Scott, a respected Louisiana economist, recently told KEEL News that fears of a recession are overstated. “I don’t think that’s going to happen,” Scott said. “Instead of just listening to me, look at the Consensus Forecast USA, which gathers predictions from firms like Moody’s, JP Morgan Chase, and Goldman Sachs. None of them are forecasting a national recession right now.” 

Louisiana’s Outlook: Slower Growth, But Still Growth 

Scott acknowledged that while the pace of economic growth will likely slow, especially due to new tariffs, he doesn’t believe it’ll be enough to trigger a recession. “I don’t like the tariffs,” he said bluntly. “They’ll slow things down, but not enough to cause a recession.” 

He pointed out that some areas of Louisiana, especially along and south of I-10, are already showing signs of growth and despite criticism from experts who cite shrinking state GDP, Scott emphasized that employment numbers tell a better story. “The employment numbers are still growing. We’re not seeing negative signs there.” 

The Role of Energy, Shipbuilding, and Durable Goods 

Louisiana’s economy continues to rely heavily on the fossil fuel sector, and Scott says the Biden administration’s previous pause on LNG exports stalled several large-scale projects, but now that pause is over, and momentum is returning to industries like petrochemicals and offshore drilling. 

Shipbuilding is also a surprisingly strong player in the state economy, especially in the southern parishes. Companies like Bollinger and Edison Chouest employ thousands thanks to regulations like the Jones Act, which requires U.S.-built and flagged ships for domestic transport. 

Meanwhile, Louisiana’s lack of dependence on durable goods manufacturing helps buffer it from national economic swings. “We don’t make cars here anymore,” Scott said. “So when folks across the country stop buying big-ticket items in a downturn, it doesn’t hit us as hard.” 

Inflation and Interest Rates Still a Concern 

While the national inflation rate has cooled to around 2.7%, Scott cautioned that prices will remain high, especially with tariffs pushing up the cost of imported goods. “Inflation may stay stubborn over the next few months,” he warned, adding that’s likely why the Federal Reserve isn’t cutting interest rates just yet.