Next problem for flood-ravaged Louisiana: Population loss

Floodwater destroys thousands of Louisianan homes
Floodwater destroys thousands of Louisianan homes

The next blow to hit Louisiana after the flood waters recede could be residents deciding they have no choice but to leave.

Volunteers who are helping the tens of thousands of people who have lost homes to flooding say few people have said they are definitely leaving the state. But it is a topic of discussion among many people.

"I think everybody is still in shock. But they're in a holding pattern until they see what help might be available," said Janet Rhodus, head of a Louisiana non-profit who has been volunteering in the flood area near Baton Rouge.

When a state loses population, it's a further drag on its economy, cutting into amount of money spent at its businesses or the taxes that can be collected to support needed government services.

The population of Louisiana tumbled 6% in the year after hurricanes Katrina and Rita battered the area in 2005, and it took more than five years for the population to climb back to pre-storm levels.

It's unlikely Louisiana will face an exodus on that scale this year. Flood victims have not been sent to out-of-shelters like they were following the 2005 catastrophes. But the economy of Louisiana was stronger going into the 2005 storms, leaving some worried that some flood victims will be forced to move elsewhere this time.

Related: Louisiana floods slam struggling state economy

Part of the problem this time that could send people out of state is a shortage of available housing. The Baton Rouge housing market was already very tight before the storm, said Ginger Maulden, president-elect of the Greater Baton Rouge Association of Realtors. That housing crunch is going to get worse, she said. More than 60,000 homes are believed to have been damaged by flooding.

"Right now people are living with family members, trying to assess what has happened," she said. "Rebuilding will be hard for a lot of people. A lot of people did not have flood insurance."

Related: Most Louisiana flood victims probably aren't insured

Adding to the problem, Rhodus said, is the number of small businesses which have been closed due to the flooding and may not be able to reopen. That coupled with the loss of jobs in the oil industry in Louisiana in recent years due to the declining price of oil will make it difficult for some affected by flooding to find work.

"A number of businesses are not rebuilding at all," she said. "People are going to have to relocate to find work and feed their families."

Louisiana already has the fourth highest unemployment rate in the nation at 6.3%. It has lost 2,000 oil and gas drilling jobs in the last two years.

"An economy is generally left no worse off because of a natural disaster because of the aid and insurance money that comes in," said Mark Zandi, chief economist with Moody's Analytics. "But for an economy on the ropes, it may send people away, and that would make a bad situation worse."

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