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Newell: Louisiana must capture repatriated manufacturing & tech jobs

GNO Inc's Michael Hecht bullish on value-added food products

Newell Normand
May 27, 2020 - 3:08 pm
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GNO Inc President and CEO Michael Hecht returned today for his weekly segment with Newell to discuss the state of business and industry in the metro area as Phase One of reopening continues without interruption and hurricane season waits on the near horizon.

“What are some of the trends you’re seeing right now that you’re actually happy about, that you’re encouraged by?” Newell began.

“I’ve been cautiously optimistic with what I'm seeing with the reopening,” Hecht said. “As you look around, you see that businesses are beginning to generate some revenue on their own, and psychologically, people are starting to get some sense of hope by taking steps in the right direction. If we’re able to keep up this slow-and-steady progress going, we will be able to emerge battered and bruised but still standing. In the mid-term future, if you objectively look at the changes that the virus is bringing and accelerating what was already happening, there's a lot of opportunity for us in this state and region. Manufacturing is going to be repatriated from places like China because we have seen how dangerous and expensive it can be to rely on China for your components. That’s going to be a huge opportunity for Louisiana. Tech has a change coming - our tech companies have discovered you can work from home in the United States, but it's hard to work from home in places like Bangalore. A lot of the software work that has been placed offshore is going to come back to lower-cost markets in the US and New Orleans is really well-positioned for those jobs.”

“Obviously, there has to be some kind of economic development arm that takes the lead here, bringing together all the disciplines necessary to make this transition,” Newell continued. “Have you started to have those preliminary discussions? This re-shoring of companies from China and others seems like it might have some momentum in Congress to provide seed money for that. That tells me that the sooner we are ready to receive it, the sooner we are ready to exploit it and the better off we can be.”

“It’s very exciting! The effort has to start Federally and be reflected and brought to the state level and parishes,” Hecht said. “The good news is that we are completely aligned in this effort. I don’t see any differences across geography or across party lines. In fact, one of the early requests we got was based on a lesson we learned coming out of Katrina. When we make the Federal ask, we have to all be on the same page. Everybody here in the greater New Orleans region has done an excellent job coming together and we have a singular ask in terms of priorities for future CARES or HEROES Acts and also infrastructure priorities we are going to need to take advantage of these opportunities. There is alignment - it starts in DC, goes to Baton Rouge, and then the regions. I don’t see anybody who is not in lockstep on it.”

“When you think about the amount of rail we have here, and the Port, the river, and being able to supply greater than a third of this country relatively easy to other rail connections up north - I get the sense that if we’re going to re-shore this manufacturing, we could be at a real geographic advantage in many respects. Your thoughts?” Newell asked.

“There’s no doubt,” Hecht answered. “That’s basically why one-third of the country was purchased, was to get the port down here. That advantage continues today. One thing I would like to see moving forward is not just leveraging our geography and logistical advantages, but also to add value to the products that come through here. Historically, we haven’t done a good job of that. The only product that gets value added here is coffee, but there are other opportunities. One that I think is really interesting is in value-added food manufacturing, everything from pre-made salads to frozen dinners. Look at our reputation for food, all the agriculture that comes through our ports, and our infrastructure like the biggest cold-storage facilities in the country. That's something we should be doing. The margin you make on those pre-made salads is many times what you get just selling the lettuce! I’m hopeful we will leverage our logistics and geography, but also make those products here because that’s going to accrue more wealth locally.”

Hear the entire interview in the audio player below.


 

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