News Roundup

New Orleans CityBusiness
by Greg LaRose
November 2, 2009

As a news journal serving the local business community, the speakers’ circuit is one of our most effective ways to connect with current and future CityBusiness readers.

In recent weeks, it’s been especially enlightening to ascertain how the current state of the national economy is impacting local businesses and professionals. What people tend to report is that while they are staying mean and lean in the face of dwindling revenues, it hasn’t been such a difficult transition given the streamlining they were forced to do after Hurricane Katrina.

The most pressing question I’m asked is how long will it be before things get better.

The story of New Orleans’ economic recovery — from Katrina and the recession — is turning into a chicken-egg scenario. What’s going to come first? Will it be consumers who will create the demand for more goods and services? Or must the businesses offering goods and services come first to lure the consumers back into the market?

The successful business in New Orleans will be the one that safely gambles to attract a customer base. That, in essence, is the recipe for niche entrepreneurism, or small businesses that carve out a specific sector in the market rather than trying to be everything to everyone.

It speaks to the evolution of the American economy. And believe it or not, here’s a trend New Orleans doesn’t find itself lagging years behind.

Slowly but surely, the mission of economic development in New Orleans and other urban U.S. centers is transforming from the fruitless hunt for the great white whale to casting smaller nets with hopes of a diverse and plentiful catch.

As technology and the swing to a service-driven economy shrink the last vestiges of the industrial age, there will be fewer opportunities for corporate giants to expand their reach. The trend will be toward small, focused businesses growing in an osmotic fashion, with demand and calculated risk driving that expansion rather than unbridled speculation.

In New Orleans, it has become clear that Fortune 500 companies are not knocking at the door. That’s not to imply conditions are more favorable for small business; the same negative factors that steer large corporations away from the Crescent City also prevent startups and existing companies from thriving here.

But as issues such as woeful public education, inadequate flood protection, violent crime, crumbling infrastructure, racial distrust and sprawling blight are addressed, New Orleans can find itself on par with other metropolitan areas in terms of its suitability to small business. And then perhaps the welcome mat for Fortune 500 becomes more attractive.

But to get to that point, daunting challenges lie ahead. And important to setting the tone for conquering those obstacles is effective leadership. Over and over, I hear from the public that the next mayor will determine whether New Orleans thrives as an internationally connected economic power or festers as a backwater burg mired in the politics of self-interest.

Audiences and readers tell me there is no one in the mayor’s race — officially or unofficially — to this point that gives them much hope. They are waiting on that candidate who puts the city on a springboard toward prosperity.

There’s still another month before qualifying for the race begins. Recall that it wasn’t until the very late stages that Ray Nagin emerged as a candidate in 2002. It’s hard to say that his victory then is cause for hope today, but it shows that a candidate has come out of nowhere before to take the reins.

Whether a mayoral maverick emerges in the next few weeks, New Orleans still finds itself poised on the cusp of establishing an innovative entrepreneurial economy. And from that pack of small businesses could emerge a powerhouse that puts the city on the map as a presence in biomedical research, digital media, international trade or energy services.

In addition to leadership, the other key element appears to be the need for cohesiveness among various business interests and the diverse aspects of New Orleans society. Katrina managed to forge some bridges but many more need to be built.

The future of the Vieux Carré is tied to the 9th Ward, just as Uptown’s welfare has a direct correlation to Central City. As goes Lakeview and the Marigny, so goes Gentilly, Treme and the East.

Those connections need constant mending to the point where New Orleans is as strongly bonded in prosperity as it was in the depths of despair post-Katrina.