LAFAYETTE - Oil jobs in Baton Rouge are safe for now, but things could change if oil prices don't bounce back by the end of the year. That's according to leaders with the Louisiana Oil and Gas Association, which held its annual State of the Industry address in Lafayette on Wednesday.
"If oil prices continue to remain low or continue on a downward trajectory into 2016 or the later part of 2016, then yes, you could see significant cuts in employment and reductions in expenditures all over the economy," said LOGA's vice-president Gifford Briggs.
In Lafayette, the dramatic drop in oil prices is having an immediate impact on jobs. "You can tell it's slowing down slowly, but surely, and with oil prices, business is going to get a little worse each day," said Shannon Hardware store manager Mike Guidry. According to Guidry, an estimated 95 percent of his store's business is tied to the oil industry.
"Unfortunately we had to layoff three people last week. We're holding our own but there's a possibility of more layoffs in the future," added Guidry.
Along with jobs, the shrinking oil industry is expected to impact Louisiana's economy. According to LOGA the state can expect $800 million less in revenue for 2015. This adds to a total projected budget deficit around $1.5 billion for the coming fiscal year.
"Every dollar dropped in the average price of oil is about $12 million to the budget," said Briggs. LOGA is expecting state law makers will have to either raise taxes or cut services to make up for the loss in revenue.