Local economy OK in first quarter, bracing for inflation

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Local economy OK in first quarter, bracing for inflation

SHREVEPORT - The local economy stood on relatively solid ground in the first quarter of this year, which includes the first month of the Iran war.

That's according to the first quarter Northwest Louisiana Economic Dashboard from the LSUS Center for Business and Economic Research (CBER).

Doug White, CBER director, said housing prices and mortgage rates are stable, Shreveport tax collection grew, and measures of discretionary spending like airport traffic and casino revenues are solid.

But energy prices continued to spike through April and don't appear to be trending down anytime soon, especially while the Strait of Hormuz remains closed.

That will cause a further spike in the inflation rate, which already grew 3.3 percent from March 2025 levels and represented nearly a full percentage point increase from February.

"If I were trying to spin a positive story, I could probably do it," White said. "If I was trying to spin a cautionary story or a negative story, I could probably do that, too.

"There's nothing in (the dashboard) that scares me, but at the same time, there's a lot of uncertainty - and business owners and economists don't like uncertainty."

HOUSING

Mortgage rates are trending down at 6.11 percent, its lowest since 2022.

Housing prices are holding steady with the median price of a home at $246,000 in the four Northwest Louisiana parishes. Those prices have ranged from $240,000 to $260,000 for the past three years.

"Housing prices haven't really gone up or down, and the housing market remained relatively consistent," White said. "Sometimes there's nothing wrong with consistency and stability, so the housing market's relatively strong."

This report doesn't capture the rent market, but a separate CBER study published in April shows that Shreveport-Bossier has high numbers of cost-burdened renters.

TAX COLLECTION

The City of Shreveport's tax collection numbers grew two percent from 2025 first quarter, coming in at $41,413,718 this quarter.

The hotel/motel tax occupancy tax grew 7.4% year over year, bringing in more than $1.2 million in the first quarter.

AIRPORT

While Shreveport Regional Airport did see a decline from its record-setting 2025 first quarter, the more than 155,000 flyers who came and went would still be the second-biggest first quarter in its history.

That's about 15,000 fewer flyers, perhaps an anomaly or perhaps numbers that are trending back toward the norm after a huge 2025.

Jet fuel price spikes related to the Iran war and the potential for fewer flights nationwide could further impact airport traffic this year.

"Is the decline because people are traveling less or because ticket prices have gone up because of the war?" White asked. "Or do people have less money in general to travel? It's really hard to say."

CASINO

As Live! Casino passes its first-year mark, the overall casino market is still expanding with a 3.7% revenue growth this quarter compared to the 2025 first quarter.

But there are winners and losers starting to take shape.

Only Live! and Horseshoe brought in more revenue year over year, and Live! wasn't open for the entire first quarter.

Bally's, Sam's Town and Boomtown were all down at least 10 percent.

Bally's announced earlier this year that it's purchasing the Sam's Town location, a merger that is expected to be complete around the third quarter.

"You have the three really big casinos - Live!, Horseshoe, and Margaritaville - and then you have Bally's that's trying to get bigger and compete," White said. "Live! has definitely expanded the market, but at the same time, it has taken some of that market share from other casinos."

White added that the casino market's overall growth in the first quarter signals that at least some Shreveport-Bossier consumers aren't feeling financially pinched.

"If people were hurting or if the economy is slowing down, I'd expect to see it in areas like casino revenue," White said. "But there are still signs that we're in a K-shaped economy, which means that upper income people are doing great while middle- and low-income people aren't doing as well.

"There is a case to be made that overall economic numbers aren't capturing the real story for many people right now."

THE FUTURE

Inflation is the name of the game as fuel shortages and shortages of other products that rely on the Strait of Hormuz will be a key driver of the inflation rate.

Higher gas prices, which soared past $3.70 on average locally, mean that consumers have less to spend in other areas.

Inflated diesel prices means shipping costs will be higher, which will eventually work their way into the price of pretty much everything, including food.

"Those higher prices are going to eventually work their way in," White said. "Think about fertilizer, which is heavily produced in the Middle East.

"Those prices went way up, which means that we may not have as abundant of a harvest this year. We might not see those higher prices across the board until the middle or late summer, but it could be coming."

Natural gas prices have also doubled in the last two years, which will drive up energy bills among other factors.

White said consumers overall have been resilient, but questions how much a prolonged increase in energy prices will impact consumer spending.

"If inflation continues to grow at faster rates, that affects disposable income," White said. "You go out less, you spend less - you don't go to the casinos or the movie theaters or to restaurants as much.

"I'm waiting to see what the March and April unemployment numbers look like."

Higher inflation means The Federal Reserve will be less likely to cut the federal funds rate (which determines the interest rate).

The flipside is what's happening in unemployment, which didn't have March numbers because of the government shutdown. February numbers stood at 4.5 % in Shreveport-Bossier, which are in line with the slow uptick nationally but also don't reflect any possible impact of the Iran war.