Narrative: II. a. 1. A.

(A) Economic Analysis. Louisiana is a major energy producing state. In Louisiana, 9.1% of the state’s gross state product is derived from oil and gas extraction and production; basically triple that for the nation as a whole. In fact we are ranked 2 in production of both oil and natural gas if the Gulf waters are included. When energy prices are strong, the state prospers. When oil prices are declining, it is tough----especially for certain areas of the state. Last year has been one of those bad years, and it is reflected in the 2015 employment numbers and the prospects for 2016. The Louisiana Economic Outlook forecasts are based on the following assumptions:

• Slowed by rapid increases in regulations and higher tax rates, the U.S. economy will continue its plodding pace of expansion with RGDP averaging 2.6% growth annually. • Inflation will remain in the modest 2.1% range, and minor increases in interest rates can be expected. • The LEO is projecting a rebound in oil prices to $55 in 2016 and $60 in 2017, though enormous uncertainty requires us to place a $30 to $90 a barrel range around those forecasts. • An increase in industrial demand combined with a reduction in supply due to much reduced rig counts, should put upward pressure on natural gas prices, with the price per mmbtu going to $3.50 in 2016 and $3.90 in 2017. • About half of the $125.1 billion in announced projects are under construction and about half are at the FEED and permitting stage. Viability of the FEED group is threaten by the EPA (1) lowering ozone standards in the U.S. and (2) imposing the Clean Power Plan that will radically raise industrial utility rates.

With the addition of the Hammond MSA, Louisiana is now home to nine metropolitan statistical areas. Prospects for each will dramatically turn on where the MSA is located. Essentially, the LEO sees the state split into three regions: (1) the rapidly expanding Baton Rouge and Lake Charles regions; (2) the languid northern tier of the state; and (3) an oil patch region that will decline through 2016. From the largest to the smallest MSA, the LEO MSA forecast: • Louisiana’s largest MSA---New Orleans---is projected to show meager growth of 0.5% (+2,900 jobs) in 2016 and a better 0.8% (+5,100 jobs) in 2017. Layoffs in the MSA’s oil sector and declining spending by the Army Corps will arrest growth that would be much better due to (1) the opening of two new, large hospitals, (2) $1.1 billion in industrial expansions underway, (3) expansion of the airport, (4) a condo building boom, and (5) a number of new firms coming to the region. New Orleans’ record could be much better in both years if some $23.5billion in projects at the FEED and permitting level actually go “vertical”.

• After cracking the 400,000 employment level for the first time, the 9-parish Baton Rouge region is poised to enjoy two good years of growth, adding 8,900 jobs (+2.2%) in 2016 and 6,200 (+1.5%) in 2017. This MSA has about $8 billion in industrial projects under construction. The slightly slower growth rate in 2017 is due to several of those winding down and few firms at the FEED stage in this MSA. Several high tech firms are entering this market led by IBM---and the remarkable 125% growth in tonnage at the Port will be repeated as the pellet exports evolve. The loss of two significant headquarters and threats from the EPA will stifle growth here.

• After basically seven years of decline, the Shreveport-Bossier MSA will be dragged down again In 2016 by a suffering extraction sector (-800 jobs) but a modest rebound should occur in 2017 (+800 jobs) led by the Benteler Steel expansion at the Caddo-Bossier Port and additions at the Computer Sciences Corporation.

• Persistent layoffs in the energy sector will drive employment lower in the Lafayette MSA for a second straight year in 2016 (-2,600 jobs), but if our oil price forecasts are near the mark, 2017 should be a recovery year (+2,000 jobs). The opening of the new Bell Helicopters plant and the addition of four new high tech firms will help this region.

• Like Lafayette, the Houma MSA is being pounded by the energy sector and energy-related firms. Edison Chouest and Gulf Island Fabricators alone have cuts 3,000 jobs. The LEO projects the energy sector to drag in 2016 (-2,000 jobs) before recovering about 1,000 jobs in 2017 as oil prices hopefully rebound and stabilize. Substantial coastal restoration monies are about to reinvigorate this region as well.

• The hottest area of the state right now is the Lake Charles MSA. This region has a remarkable 39.6 billion in industrial projects under construction and an equally remarkable $45 billion at the FEED and permitting stage. A huge boom in industrial construction workers will drive this region up by 7,400 jobs (+7.1%) in 2016 and another 2,000 jobs (+1.8%) in 2017. This latter year’s growth rate could become much larger if the projects at the FEED stage move to construction. Other good news for this region came when the Golden Nugget Casino opened and actually grew the gaming market without cannibalizing business away from the other two casinos.

• Unfortunately the Monroe MSA has been languishing for 13 years and there seem to be few prospects of that changing over our forecast period. We expect the region’s employment to be flat in 2016 and expand by a modest 200 jobs in 2017. The area was rocked by the announcement that its largest employer---CenturyLink---was starting a round of layoffs. Fortunately only 55 jobs were targeted in this MSA.

• Our forecast for the Alexandria MSA is a continuation of the modest growth the region has experienced for the last two years---adding 500 jobs a year. This projection could turn out to be radically conservative if American Specialty Alloys follows through with their proposed new $2.4 billion, 1,400-person plant.

• Louisiana’s newest, and smallest MSA is Hammond. Composed of only Tangipahoa Parish, this university town is enjoying a very good 2015 due to enrollment and budget boosts at SLU and from an energetic healthcare sector. These same factors should enable the region to add an expected 700 jobs a year over 2016-17.

The combination for the forecasts for these MSAs, along with modest growth in the 29 rural areas of the state, should put the state on a path to add 15,400 jobs in 2016 (up 0.8%) and 19,600 jobs in 2017 (up 1%). If the LEO forecasts are near the mark, sometime between the latter part of 2015 or early 2017 Louisiana will have more than 2,000,000 non-farm employees for the first time in Louisiana’s history

The Louisiana Workforce Commission’s Labor Market Information (LMI), Louisiana Occupational Information System (LOIS) Scorecard is the state’s Virtual Labor Market Information Web Portal. This interactive site provides users with access to the latest Louisiana labor force, wages, population, industry employment, training schools, training programs, Scorecard for completion rates, Youth Web Portal, projections, demographics, nonfarm employment, employer database, unemployment claimants, industry staffing patterns, licensed occupations, demand occupations and career products. The LMI tables and charts and figures that follow provide projections for Louisiana’s long term industry growth projections.

Additional supporting data can be found at:

Existing Demand Industry Sectors and Occupations Louisiana’s short term and long term employment projections suggest that the annual average workforce demand to increase at 1.3 percent outpacing the national annual average workforce demand of 1.1 percent. http://www.laworks.net/Images/WIOA/ExistingOccupations_1.jpg

Top 20 High-Demand Occupations by Employment High demand occupations are those with three, four, or five star rankings as determined by the Louisiana Workforce Commission. LWC’s star ratings system takes into account wages, job openings, employment, and projected growth for over six hundred occupations, both statewide and regionally. Tables 4 and 5 show some of the highest rated occupations sorted by wage and employment, respectively. http://www.laworks.net/Images/WIOA/ExistingOccupations_2.jpg

Emerging Demand Industry Sectors and Occupations 2022 Industry Projections for Louisiana, Two-Digit NAICS The first chart provides projections on industries expected to have the greatest growth by 2022. The highest growth occupation according to these projections will be the medical field. http://www.laworks.net/Images/WIOA/EmergingOccupations_1.jpg

2022 Occupational Projections for Louisiana, Highest Forecasted Growth Jobs with Licensed practical and licensed vocational nurses having the highest growth rate of 18.3%. http://www.laworks.net/Images/WIOA/EmergingOccupations_2.jpg

Number of Job Vacancies Across Industry Sectors, Second Quarter 2015 - The industry sector Trade, Transportation & Utilities leads statewide in number of vacancies (14,760 vacancies), followed by Education & Health Services (13,890 vacancies) and Leisure & Hospitality (13,320 vacancies). http://www.laworks.net/Images/WIOA/EmployerEmploymentNeeds_1.jpg

Employers’ Greatest Challenges in Meeting Workforce Needs -In the 2015 Job Vacancy Survey, employers were asked the open-ended question, “What is your greatest challenge in meeting your workforce needs?” The chart above summarizes these responses into the most common responses. It is encouraging that the most common response was “No difficulty.” The second and third most common responses involved a shortage of qualified applicants based on experience and work ethic. http://www.laworks.net/Images/WIOA/EmployerEmploymentNeeds_2.jpg