Financial Experts Predict Economic Woes Ahead For MS - - The News for South Mississippi

Financial Experts Predict Economic Woes Ahead For MS

BILOXI (WLOX) -- At an economic check up on Thursday, experts revealed there may have been a silver lining to Hurricane Katrina. They say Katrina has helped Mississippi weather a recent national economic down turn better than other parts of the country. However, that could be changing.

Experts say these are uncertain financial times, and for Mississippi, they expect it will likely get worse before it gets better - especially in the job market.

After Katrina, much of the Gulf Coast needed to be rebuilt. Financial experts say the result was South Mississippi went from 5,700 construction jobs before the hurricane to about 8,000. But those jobs are starting to go away, down to roughly 7,300 today.

Dr. Bill Gunther works with the University of Southern Mississippi's Bureau of Business and Economic Research.

"We got a big bounce from Katrina as we rebuilt. A lot of that money was spent. A lot of that money generated additional tax revenue, it was income taxes. But that money is gone. That money is pretty well spent, and so we're having the post Katrina effect."

Gunther told a group at the Mid-year Assessment for South Mississippi and the Gulf Coast, "We're going to see less jobs in December than we had in January. "

Experts say by the end of the year, expect negative job growth. Katrina recovery alone won't be enough to completely shield our area from the country's economic woes.

Gunther says there are 1.2 million people employed in our state. That's 3,000 fewer than in the year 2000.

Dr. Ed Ranck is also with the USM Bureau of Business and Economic Research.

"We still have houses to build," he said. "There are also some public construction projects, a couple of prisons, jails, city halls, things like that that took a little longer to put in to the pipe line. [They] are now coming on line, so there is going to be some continued storm related construction that will probably sustain us to a degree. But that doesn't mean that we can withstand a serious, prolonged, national recession."

Industries like casinos and healthcare are holding steady on the Gulf Coast, but experts say where the nation goes economically, usually goes Mississippi. So now is the time to prepare for rough times ahead.

"People have to reassess and say, 'What's important to me? Do I really need to do this?' I think we'll see a lot of that," said Gunther. "That means there is going to be weaknesses on the retail side because people are going to say, 'I need food. I don't need those new shoes.'"

State Treasurer Tate Reeves also spoke about Mississippi's economic outlook. He said inflation and rising prices will create the greatest challenges here because our state is ranked near the bottom in per capita income.  

By Danielle Thomas

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