As the second largest state for chemical production, Louisiana is growing at a rapid pace within the industrial sector.
Over the past decade, the centrality of Louisiana’s petrochemical and manufacturing industry has led to large investments within the region. According to Martha Moore, chief economist and managing director of the American Chemistry Council, an investment of $65 billion dollars’ worth of petrochemical production occurred in the state last year.
"Louisiana is a hugely important chemical manufacturing part of the United States," explained Moore. "It is the second largest manufacturing industry in the state and it’s the second largest state for chemical production, of course Texas being the largest."
Despite slowing production rates on the national scale, Louisiana remains well positioned to continue its profitable growth, especially in the Baton Rouge area.
"We’ve seen some softness certainly in the national level data in employment; the industry is in a little bit of a downturn," Moore said during the "2024 Louisiana Petrochemical Outlook" webcast presented by 10/12 Industry Report. "But that’s not the case in the Baton Rouge area. The area is tied for the highest level of chemical manufacturing employment at almost 13,000 jobs just in the Baton Rouge area."
Recent project announcements have contributed to a need for additional workforce development in Baton Rouge within the coming years, according to Dave Luecke, plant manager with ExxonMobil in Baton Rouge.
"In terms of what people have announced and are possibly intending to build, we’re actually tracking around $30 billion dollars’ worth of projects," said Luecke. "Assuming everybody goes forward, there’s no way all of that can get built since there’s just not enough skilled workforce in the trades to do that kind of work. We need to encourage more people to get into the trades."
Despite concerns over skills gaps and workforce development, the overall workforce remains strong in its abilities to overcome potential challenges, according to Dai Nguyen, GM with Shell in Geismar, Louisiana.
"We talk about the workforce not having enough but we’re also set up with a pipeline to grow and manage that in the short and long term," Nguyen said. "The folks we have in our workforce are very competent and familiar with the industry, which is a huge, tremendous advantage when you think about the performance that we expect as we are executing the construction."
The powerful centrality of Louisiana’s petrochemical industry makes it well-positioned for the transition into clean energy, Nguyen said.
"The fact that we have such a strong industrial base already positions Louisiana greatly for the energy transition," Nguyen said. "We can talk about the infrastructure that we provide, the pipelines that already exist, the different competitors and contractor companies — the industry as a whole has a huge advantage."
For Louisiana to maintain its strong position in the energy sector, continued implementation of AI technologies is essential for safer and more reliable operations, according to Nguyen.
"The benefits [of AI technologies] have contributed to improvements in process safety," Nguyen said. "Any time you can get better data in making the right decisions around integrity and anything that helps us understand our reliability performance — that all contributes to, essentially, better safety operations."
Along with reducing safety concerns and enhancing reliability, these new technologies can save time on the jobsite and reduce costs related to tedious tasks, explained Luecke.
"We’re doing a lot to look at how we can use the new technologies and being very thoughtful about maintaining data integrity and protection," Luecke said. "We’re trying to take away the mundane work and automate that so that workers can spend their time on more critical projects."
