Louisiana’s brain drain is real

By Robert Mann

Two Sundays ago, my column in the New Orleans Times-Picayune | NOLA.com examined Louisiana’s well-documented brain drain.

“Every year, thousands of our young people give up on Louisiana,” I wrote. “They stuff their college diplomas in cardboard boxes and shove off in pursuit of greater opportunity. They escape, taking with them their creativity, their energy and their incomes. They raise their families elsewhere. Louisiana is diminished because of their absence.

“You and I know what it will take to keep our kids home – well-paying jobs and the sense that the state is alive and thriving, not slowly dying.”

In the piece, I advanced an argument that I hope might persuade some of our state’s young people to stay: 

Atlanta, New York or Los Angeles might provide you a better job, but Louisiana needs you more. You want to save the world? Well, you can do that here. Sure, there are hungry children to be rescued in Africa and India, but your hometown has plenty of them, too.

You’re frustrated with the intolerance of this state? Will your leaving – taking your broadmindedness with you – make Louisiana any more tolerant?

Stay here, find like-minded people, organize them, expand your influence, demand change, but don’t give up on this amazing, beautiful place. Its good people – flawed as we might be – are worth your efforts.

Michael Hecht is president of GNO, Inc., essentially the chamber of commerce for the New Orleans region. In that capacity, he’s paid to be a cheerleader for his region and its economy. I suspect he’s also very interested in staying in the good graces of Gov. Bobby Jindal and his Economic Development secretary, Stephen Moret. Jindal and Moret, after all, can provide state incentives to help Hecht attract business to his region. If I were in Hecht’s shoes, I suppose I’d be an unabashed cheerleader for Jindal, too.

But the Jindal-Moret line is that Louisiana’s economy has turned the corner.

Maybe it has, maybe it hasn’t. 

Yet, it’s not at all the case that Jindal and Moret have stopped our brain drain. But don’t try telling that to Hecht.

In a letter last Sunday to the Times-Picayune, Hecht wrote, that the “alleged brain drain in Louisiana is so far off the mark, one has to assume [Mann] is simply being provocative. Of course, the Louisiana diaspora, dating back to the oil bust of the ’80s, was real. But since Katrina, and especially over the past five years, this trend of talent migration has reversed in historic fashion.”

In addition to denying the state’s continuing brain drain, Hecht further wrote,

This is why Forbes named greater New Orleans the nation’s “Brain-Gain Cham­pion” for attracting more young people with college degrees than anywhere. Bloomberg ranked us the No. 2 boomtown in America based on our combination of population and GDP growth. Daily Beast named us the No. 2 aspirational city in the nation. We rank high in creating middle­class jobs, and economist Joel Kotkin says we are in the top 10 for worker in-migration, across all ages.

And finally, this year Louisiana saw its sixth straight year of net in-migration.

I’ve been busy preparing for the start of LSU classes this week, so I haven’t had time to delve into everything that’s wrong and distressing about Hecht’s letter.

To my rescue, however, comes a Tulane University lecturer in systems analysis and data mining, Dr. Raymond J. Brady. He was kind enough to share with me his response to Hecht’s letter. Below is his thoughtful and devastating reply to Michael Hecht:

Mr. Hecht, who is President of GNO, uses outdated data reports in his response to your article. And unfortunately, he should have known better.

The first article he cites, “Brain-Gain Champion,” published in February 2011 in Forbes Magazine uses data from the American Community Survey (Census Bureau) for two years 2007 and 2009 to extrapolate that New Orleans is “attracting more young people with college degrees than anywhere.” 

Every first-year student in a statistical forecasting class learns the term “outlier:” a data point not representative of a trend. And the years used in the Forbes study simply are “outliers,” when used to compare New Orleans to other cities in the study. That is, the year 2007 was the beginning year for population recovery in Louisiana, particularly in the city of New Orleans, and the year 2009 was the peak year for population return from the Katrina disaster. 

Even the author of the article qualifies the results by saying: “New Orleans No.1 ranking, for example, is likely product of the continuing recovery of its shrunken population.”

Obviously, I’m not faulting the study’s author for using 2007 and 2009. These are two “normal” data points to do comparison. But these two years are not “normal” with respect to population recovery from Katrina. This I fault Mr. Hecht for using, without any mention of the possibility those two years could distort the results.  

Mr. Hecht could have said that “a report released in 2011 using 2007 and 2009 as years to compare population growth in cities across America showed  (my emphasis) New Orleans as the #1 growth center for attracting post-secondary young to the city of New Orleans. But instead, he uses the results as a general statement to attack your comments, implying that a three- or four-year-old study reflect current conditions—snake oil—I say! 

I have no problem with Mr. Hecht saying that New Orleans does have more young people with post-secondary degrees today than in 2007 or pre-Katrina New Orleans. And that is a good sign that educated young people are seeing more opportunity in post-Katrina New Orleans.

However, to say that New Orleans is “attracting more young people with college degrees than anywhere” just does reflect current or post 2009 facts. As a not so bright sign, New Orleans, according to the American Community Survey, actually had a 7% decline in individuals holding doctorate degrees between 2010 and 2012.

With respect to his using a Bloomberg (March 2013) report, “Biggest Boomtown: U.S Cities” using data between 2007 and 2011, he again stretches facts.

An analysis of the population data again shows that 65% of the population growth in that period occurred between 2007 and 2009. But again, data two or three years old is “ancient history” in terms of assessing current economic or population potential, and can only be used a reference point, but not indicator of a trend.

With respect to his comment on real GDP growth that he cites, I have to give him slack on that comment because the figure used in the Bloomberg report is just wrong on the growth of real GDP in the New Orleans MSA. I’m looking at the Bureau of Economic Analysis data right now, and the real GDP in the New Orleans MSA grew by 0.0096% (or 1%) between 2007 and 2011.

Finally, domestic in-migration into the state actually went negative between 2011 and 2012 (source: Census Bureau estimates).

Does this suggest a return to historical trends in net out-migration from Louisiana or just a blip on the recent trend of net in-migration? (By the way, IRS data shows that the positive state level net in-migration in the recent past all can be attributed to the re-population of the city of New Orleans, not some change in economic perception about opportunities in Louisiana.

Certainly New Orleans of 2014 is a better place to live than New Orleans of 2004.  But facts are facts: the New Orleans MSA likely added net of about 5,000 or so non-farm jobs between 2012 and 2013 (BLS, Current Employment Estimates). Louisiana is likely to have added about 26,000 jobs.

But to return us to reality, final employment data for the 2012-2013 will show that a place like the Dallas – Ft. Worth MSA likely added about 97,000 jobs between 2012 and 2013. That’s four times the job additions for the entire state of Louisiana, and almost twenty times that of the New Orleans MSA. And simply put, people move where the jobs are!!! 

Finally, Michael Hecht clearly has passion for the New Orleans region, but sometimes passion will blind you to the height of the hill that Sisyphus must climb!!

* * *

Dr. Brady teaches at Tulane University, teaching classes in systems analysis and data mining. He also does consulting in economic analysis and economic modeling. He is a member of the New Orleans Regional Council of Business Economics and has taught at the University of California, Berkeley. He is a native of New Orleans.

Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

2 Responses to Louisiana’s brain drain is real

  1. Jim Mayer says:

    Bob The brain drain is necessary by high student debt& high cost of private school for children. Lack of jobs with upward future & mobility not available in La.. My relative head of personel Goldman Sacks told me they gave up on LSU grads as they lacked a work etic and took job fairs casual. Engineering and petroleum related fields are the only good opportunities. Our law grads. Have non aiding basic degrees and many score poorly. Law is over crowed. A friends son in 5 years NO ZERO JOB OFFERS. Jim Mayer

    Like

  2. gail says:

    …as my husband & I stated to mayor hightower 10 years ago “louisiana is doing a great job educating our children”…by way of the magnet, private & parochial schools…that then feed into our state colleges…evidenced by the fact that texas steals as many of our college engineering & education graduates as possible…and that we need to figure out how to save them from texas…but …good jobs in texas continue to trump momma & grandma.

    Like

Comments are closed.