Wednesday, July 28, 2010
Written by Gregg Gothreaux
By combining forces with neighboring parishes, LEDA assesses Acadiana’s business climate, and if not for the drilling moratorium, we’d be sitting rather pretty.
With a goal of meeting with more than 500 unique businesses a year through our business visitation program, the LEDA staff keeps a thumb on the pulse of the business community in Lafayette. We’re not an island, however. Lafayette is heavily impacted by the economic activity of our neighboring parishes. Because of this interdependence, LEDA and our economic development counterparts in the six neighboring parishes formed the Acadiana Economic Development Council in 2004. Since then, AEDC has conducted nearly 550 visits with business leaders from the top companies across Acadiana. Using a specialized information-gathering questionnaire called Synchronist, AEDC representatives are able to produce reports with some telling numbers about the business climate in Acadiana.
The Synchronist Report is an overall assessment of how business is doing. It contains questions to measure market conditions, industry trends, management outlook, workforce, technology innovations and gauge satisfaction with community services. AEDC compiles the results and shares them quarterly with the business leaders they have interviewed and with state legislators to illustrate business concerns. Finally, because agencies across the state use the same report, Louisiana Economic Development is able to use the regional data as part of statewide aggregate data collection and reporting system.
Using results from the last 65 companies visited in 2009 and results from the 50 business visitations conducted so far in 2010, AEDC has compiled this snapshot of Acadiana’s business climate. Company Sales
The first half of 2010 has, so far, painted a better revenue picture than 2009. More than 84 percent of companies surveyed this year reported that sales have remained stable or have grown slightly. The tone of most visitations since the beginning of the year has been largely optimistic and demonstrates the strength of the Acadiana business community. However, visits conducted in late second quarter and early third quarter with energy companies have begun to reflect concerns stemming from the Gulf oil spill and the subsequent offshore drilling moratorium, which stands to stifle the earlier gains of the regional economy in 2010. Market Share
In the first half of 2010, the majority of business respondents (70 percent) reported they have maintained their market share. In these cautious times, being able to maintain a stable market share is a business success. While the 30 percent who say they have increased their market share is less than in 2009, it is important to note that no one reported a decrease in market share in 2010.Layoff Projections
The layoff projections of the first half of 2010 painted a positive employment picture for Acadiana. The Gulf of Mexico oil spill occurred in the second quarter, yet interviewees from energy companies have not yet responded with any large-scale layoffs. Energy-related companies have been as resourceful as possible to minimize layoffs but will be faced with tough decisions in the months to come. Those who stated that layoffs are likely in the near term were interviewed after the oil spill. Visits so far in the third quarter also reflect this trend.Workforce Evaluation
Acadiana business leaders were asked to rank certain attributes of the local workforce on a scale of one to seven, with seven being best. While availability of workforce is on the higher end, the overall quality and stability of our local workforce is considered to be just slightly above average. With the overall volatility of 2009 and rising unemployment numbers, workforce availability is no surprise. The first half of 2010 is very similar to 2009, showing some workforce shifting still occurring in the marketplace; however, recent visitations have shown that employee turnover is beginning to slow in many areas.
Visitations conducted so far in the third quarter have been more subdued compared to the first half of the year. As events unfold concerning the cessation and clean-up of the oil spill, businesses may be impacted positively or negatively, and this will be reflected in future Synchronist reports. With the potential to lose more than 7,000 jobs over the next year in Acadiana, our economy is in a holding pattern until a resolution or compromise is reached over the offshore drilling moratorium.
As business leaders, you should all participate in a Synchronist visitation if you are contacted by AED. Specifics from the interviews are confidential and will help LEDA and AEDC advocate for policies that will help businesses across Acadiana in the future. Gregg Gothreaux is president and chief executive officer of the Lafayette Economic Development Authority. To comment on this column, e-mail