Thread: New Orleans labor shortage hobbles business recovery

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New Orleans labor shortage hobbles business recovery

By Ted Gregory Tribune staff reporter 7 minutes ago

One month after Hurricane Katrina destroyed his home and crippled his business, a bedraggled Stephen Cotsoradis sat in his empty, ancient office in the brick warehouse of Gulf Marine & Industrial Supplies. He was saying he would leave the fate of his business to his children after he retires. The phone rang.


"Yeah. ... Where the heck are you?" said the 75-year-old Cotsoradis, his voice thick with the Greek accent he brought with him more than 50 years ago. "When are you coming in? You got a telephone number? How many bedrooms you need? Ho, whoa, whoa. OK. Let me see what I can do. Hey, everything OK?"

Everything is less than OK with Cotsoradis and many other business owners in the New Orleans area. Conventional wisdom might suggest that Katrina's wrath shut down so many businesses that thousands of people are out of work. And, to an extent, the conventional wisdom is correct.

But, hundreds of businesses in the area--important businesses like Gulf Marine, which company officials say provides food to many of the cargo ships in the Gulf of Mexico--are trying to get rolling. They simply cannot find their current employees, many of whom were evacuated when Katrina struck on Aug. 29, and employers are unable to hire people for the same reason.

Radio spots advertise jobs for auto parts clerks, welders, medical technicians, sales reps and dozens of more occupations. At the Walgreens drugstore in suburban Marrero, cashiers ask customers if they know someone who needs a job.

"It's very, very difficult now," said Cotsoradis, who has owned Gulf Marine since 1960. "They don't like it here anymore. One guy, we didn't hear from him until he called from the highway. He said, `I'm in California. I'm never coming back."'

Cotsoradis estimated that his company used to sell about $1 million in goods a month to other ship suppliers. "Now," he said, "it's zero."

Gulf Marine had about 75 employees in its New Orleans headquarters. "Maybe 20" have returned, Cotsoradis said.

Greg Kempton, owner of Advance Water Proofing, which specializes in the restoration of building exteriors, said he had about 30 employees before Katrina. Now, about 10 people are working for him. Like Cotsoradis, he noted the housing shortage in the New Orleans area since the hurricane has kept the labor force small. Cotsoradis also said companies coming to New Orleans as part of the recovery effort are luring the few available employees with better wages.

Kempton also blames the
Federal Emergency Management Agency's aid to evacuees, which Kempton said, "makes it too easy for people to relocate in other cities. His former employees are in Minnesota, Michigan, California, Arkansas and Texas, he said.

"It's one thing to help people out," Kempton added. "I'm all for that. But to basically set them up on a permanent basis--that kills our labor force."

To address his labor shortage, Kempton said, he bought two houses a three-hour drive away in Alexandria, La., where Advance Water Proofing also has customers. He said FEMA should bring recreational vehicles and trailer homes closer to New Orleans to provide housing for people who would like to return to their jobs but lack a place to live.

Leaving city behind

Sheldon Augusta, 41, is one relocated Advance employee who is staying put. After he, his five children and wife spent six turbulent days in the Superdome, where thugs terrorized and victimized many evacuees, the family was brought to a convention center in Dallas. A local church group found his family a two-bedroom townhouse there. His wife found a job at Wal-Mart. He is looking for work in the construction trades.

"Why should I go help build up a city like that, after it treated me the way it did?" Augusta said. "All that went out the window when they turned their back on us at the Superdome."

He said he had lived in the New Orleans area all his life, most recently in a house in St. Bernard Parish--a home, he said, that is ruined.

"They couldn't give me a million dollars to go work in New Orleans," Augusta said. "They could build a 50-foot levee. I'm not the same person. I used to love New Orleans. I used to be homesick when I'd be somewhere else. Now, it's like I've forgotten New Orleans. It surely forgot us."

The future is a little less clear for Randy Warren, 28, a sales representative for Gulf Marine. A resident of New Orleans for more than 20 years, Warren, his wife and 10-year-old son departed the day before Hurricane Katrina hit to Baton Rouge, then to Jacksonville, Fla., where Gulf Marine has an office and warehouse.

That office was running low on supplies. So, Warren hopped in a truck and drove back to New Orleans, arriving Sept. 27.

"I'll more than likely stay in Jacksonville," said Warren, whose wife found a job in a medical billing office there. "It's going to be another six months to a year before this city gets back to normal. When I see what the progress is looking like, I'll either stay in Jacksonville or come back to New Orleans. I definitely won't forget the place."

The Louisiana
Department of Labor is feeling pressure from many directions. Even before Hurricanes Katrina and Rita struck the state weeks apart, Louisiana's unemployment for August stood at 5.8 percent, or nearly 40,000 people, an increase of 1.3 percent over the previous August's unemployment, the department reported. The national unemployment rate is 4.9 percent.

Loss of 250,000 jobs

Between 250,000 and 325,000 jobs were lost in the state after Katrina and Rita, said Benny Soulier, assistant secretary for workforce development in the Louisiana Labor Department. About 80,000 businesses in the greater New Orleans area are lost or damaged significantly, he added.

Soulier is aware that New Orleans-area workers are trying to come back but lack housing. He said FEMA is starting "a massive housing assistance plan" to provide "transitional cities" around Louisiana.

"We can get the businesses and the employees back next week," Soulier said. But, "it's too early to get the people back in the area because the very basic infrastructure has to be built."

Rodney Davis, general manager of the Spring Hill Suites by Marriott hotel in New Orleans' Central Business District, said Marriott has succeeded in contacting 400 of its estimated 2,800 employees in the New Orleans area.

His hotel, which reopened Sept. 29, has 23 of its normal roster of 45 employees back on the job, he said.

One of the reasons for the Marriott's relative success is its production of thousands of yellow T-shirts that bear a toll-free number for employees to contact the company. Marriott distributed the shirts at shelters where displaced citizens were taken, Davis said.

"It's definitely getting better by the moment," he said. "I'm extremely optimistic."

A couple days earlier and a few blocks away, Mary Estrada, general manager of the Quarter House, stood outside the time-share resort in the French Quarter taking a cigarette break. She said she would like to reopen to rent suites to FEMA workers and others helping in the recovery of New Orleans.

But the closed resort typically has 55 employees. She was sharing her house in nearby Metairie with five workers.

"Most of our employees lived in the area that got hardest hit," Estrada said, referring to the Lower 9th Ward on the city's east side. "Now we can't find anyone, and the ones we do hear from who will come back want twice the money. Or, a lot of them are just not coming back because of losing their homes and having nothing."

She cannot blame them for leaving New Orleans for good. Hurricane Katrina has her considering whether she will stay in the city she has called home since 1973.

"I don't feel the same about New Orleans anymore," she said. "It's just not the same place it used to be."

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tgregory@tribune.com

Why not make a national plea for Americans looking for jobs? I suppose this will give them a reason to use more illegals.