Despite ranking, problems dog La. business

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Louisiana ranked 47 out of 50 as the worst states to do business with in 2007, but the state has seen a dramatic improvement in its business climate in recent years, and with that, has attracted businesses back to the once mistrusted state.

Chief Executive Magazine ranked Louisiana as the ninth best state to do business with, calling it the “Cinderella state of Chief Executive’s ranking, proving that a concerted effort to transform old habits and policies can truly pay off.”

Michael Hecht, president and CEO of Greater New Orleans Inc., a regional economic development organization representing 10 parishes, said the ranking is synonymous with Louisiana’s Renaissance of businesses once skeptical of the state’s business outlook.


At South Central Industrial Association’s meeting in Houma, Hecht said the magazine’s ranking stemmed from the opinion of 500 chief executive officers and their perspective on the most important criteria for a successful business. Factors such as tax and regulatory regime, the quality of workforce and the quality of living environment were cited, which have all seen improvements within the past eight years.

“We’re in the middle of the most rapid economic turnaround and comeback in our lifetime,” he said. “Nothing has been quicker.”

Hecht explained the turnaround with reasoning that Louisiana is the cheapest place to do business in America, the state’s incentives are the “deepest and most reliable in America” and there is restored trust in the state’s leadership “for the first time in decades.”


Despite the higher ranking, Hecht said there are still reasons Louisiana’s businesses have “to stick together” because of the perception gap Louisiana is plagued with.

“Reality is important but perception is more important,” he said. “Louisiana has a perception gap.”

The parishes across south Louisiana share common industries, but many businesses continue to consider moves to places such as Houston.


“There is no way Terrebonne can compete with Houston,” he said about the larger city’s population and business capacity. “Terrebonne can compete with a subdivision, maybe Sugar Land.”

Hecht labeled New Orleans, Baton Rouge and the areas of Houma-Thibodaux as a much larger unit known as the super region. By combining these areas instead of separating them, he said businesses stand a better chance at competing with cities such as Houston.

The combination of being too relaxed and confident is what led business away from Louisiana, he said. “It was the attitude that people had to be in Louisiana because we had the river and we had the energy. People got tired of it and they went to Houston where they were doing business. We gave it away.”


While business outlook is optimistic, Hecht noted that a lack in workforce is a prevalent issue.

“The entire state is growing, but that is causing growing pains,” Hecht said. “Workforce has gone from being an important issue that we talked about because we had to; to now it is the most important issue.”

Moving forward, he said people will continue to see Louisiana as “kinder” and “gentler,” as well as geologically similar to Texas.


“We’re beginning to bring them here,” Hecht said. “Our biggest risk is bad elected leadership and we can backslide.”

Michael HechtKerry Maloney