Earlier this week, the New Orleans-area economy was dealt yet another blow: Northrop Grumman announced plans to close its shipyard in nearby Avondale by 2013, signaling the end of as many as 5,000 jobs for the region.
The elimination of that many jobs would have a major effect on any regional economy, but New Orleans is in a unique situation — it’s coping with the lingering effects of Hurricane Katrina, the BP oil spill, and now this news.
To get a sense of the full economic impact of Northrup Grumman’s decision, we used Analyst, EMSI’s labor market research tool. We simply subtracted 5,000 jobs in the ship building and repairing industry (NAICS 336611) for the New Orleans-Metairie-Kenner metro area, and Analyst gave us the following results.
Assuming the Northrup Grumman closure would happen this year, an estimated 8,921 total jobs would exit the region due to the effects on other industries. That would equate into the News Orleans metro area losing a tad under $490 million in earnings.
Now, here are the top industries affected by the major employer closing its doors, based on jobs lost or percentage of jobs lost.
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In terms of total jobs, local government would be most affected, followed by restaurants. But if you look at the most impacted by percentage, you’ll see that lots of specialized manufacturing industries would take a hit, led by mechanical power transmission equipment manufacturing.