Five years ago, on Aug. 29, 2005, Hurricane Katrina leveled homes and businesses along the Mississippi Gulf Coast and flooded the city of New Orleans. Today, the physical devastation caused by the storm has largely been repaired. Economically, however, the three strikes of the storm, recession and BP oil spill have left the region with a limited and shifting customer base. Local electrical contractors have adjusted their offerings, tightened their belts or closed their doors.
Four years ago, the Mississippi Gulf Coast was a hotbed of electrical activity, drawing traveling contractors, who provided welcome support for rebuilding of the area’s infrastructures, businesses, industries and residences. Contractors streamed in from around the United States to return basic electric power to the Mississippi Gulf Coast and New Orleans, to rebuild Louisiana’s offshore oil business, and to rework the casinos on which so much of the Gulf Coast economy depends.
Since that time, most of the large projects to rebuild the Gulf Coast, including the reconstruction of casinos, some industrial sites and hundreds of thousands of homes have been completed. Some of the companies that provided interviews to Electrical- Contractor in the months following Katrina have since closed shop or changed management, several company presidents have passed away, and a new generation of electrical contractors are navigating a very different environment.
Overall, man-hours are down for the Gulf Coast Chapter of the National Electrical Contractors Association (NECA). Already before the storm, the number of man-hours in the Gulf Coast Chapter had been on the decline, said chapter manager Tracy Landers. Before Katrina, in 2004 and 2005, the chapter recorded 400,000 man-hours annually. Following Katrina, the number leaped to 1.6 million in 2006, then slid to 885,000 the following year, to 617,000 in 2008 and to 389,000 last year, with similar numbers this year. The recession has pulled contractors and electricians around the country in search of work and, in some cases, electrical shops that had traveled to conduct post-Katrina rebuilds are still in the Gulf Coast area, where they compete with local electrical contractors.
Since the rebuilding, the work is now focused on what will keep the area and its electrical business alive. The results are some generator work, even some oil spill assistance, and the ability to make do with a very tight belt.
“The gaming industry has pretty much recovered,” Landers said. “If it weren’t for that, southern Mississippi would be in [the] worst shape.”
For the Mississippi Gulf Coast, resort waterfront towns were hit with both water and wind by Katrina. Casinos, which had been located on barges due to gaming laws, were destroyed by the storm and rebuilt, this time on solid ground. Some of those included the IP Casino, Resort and Spa in Biloxi, Miss., and Harrah’s Entertainment’s Grand Biloxi Hotel, Casino and Spa. The latter’s original casino barge was washed nearly 500 feet across Beach Boulevard by the storm surge. Harrah’s 39,000-square-foot facility, which opened during summer 2006, was built on solid land; Harrah’s had expansion plans with a purchase of 18 acres that included the Casino Magic property next door. Both properties were rebuilt with electrical services from J H Haynes.
While work was plentiful in 2006—in fact, contractors were encouraging electricians and project managers to come from throughout the country to help with the rebuilding effort—the construction industry had slumped by 2008, and contractors were competing for jobs in every sector, from residential to commercial, retail and industrial work.
About 95 percent of the rebuilding work is done, according to some contractors’ estimates. When it comes to new work, those fortunate enough to have it are competing for each job, Landers said.
“Everybody’s struggling right now,” Landers said.
In addition, since the Gulf Coast economy is dependent on tourism, the April 20 Deepwater Horizon oil spill exacerbated the recession by reducing that tourism; the playing field now looks nothing like it did four years before.
The Katrina-related work that remains is in the residential market—for those homeowners who had to wage battle with their insurance companies and are just now getting around to the repair work. Some Hurricane Ivan construction remains as well. Bagby & Russell, which lost the top of its building in Ivan and suffered more damage with Katrina, has not only rebuilt, it has opened two more offices, said CEO Frank Russell. The additional sites were opened to meet needs for the Department of Transportation (DOT) and Advanced Electrical Technology (AET) departments to provide generator connections to traffic signals and lights that will be powered by natural gas.
The units modified by Bagby & Russell provide 120 to 208 volts to operate signaling in the event of an outage caused by another storm. The device uses Gillette Generators manufactured in Elkhart, Ind., with safety features to allow the use of natural gas crafted by the electrical contractor.
“The backup [power] now comes up as soon as the power goes down,” Russell said, adding that these mostly have been used in the case of lightning storms.
Thus far, Bagby & Russell has installed 90 such of these natural--gas-fueled generators. However, that’s far short of the plan for the 3,000 units the federal government initially intended to have installed in
Alabama and Florida.
“The money disappeared,” Russell said, “So, at this point, we’re just doing 30 at a time.”
That work is identified by the DOT and has been used in areas such as Mobile, Ala.
The company also has opened its AET shop on Hurricane Bay Road in Mobile, Ala., where it provides voice/data/video low-voltage work for schools, industrial plants and condominiums. The company’s most recent work was completed at the Bel Air Mall in Mobile. Bagby & Russell has been doing this low-voltage, high-tech work for the past two decades, Russell said.
“But we’ve expanded quite a bit recently,” he said, adding that this is a trend that began before the storms.
“We’re holding our own,” he said, “[But] the industry as a whole has a problem.”
Russell pointed out that the construction industry that has been feeling the recession more than most industries.
“We’ve had to scatter ourselves out,” he said.
Big projects have helped, including one of the nation’s largest—the Thyssen Krupp steel mill construction, with a portion of the installation completed by Miller Electric of Jacksonville, Fla. The facility, a cooperative effort between two Thyssen Krupp companies—Thyssen Krupp Steel USA and Thyssen Krupp Stainless USA—is a $4.65 billion world-class, state-of-the-art processing facility.
This year, the facility opened its doors and, when fully operational, is expected to create 2,700 jobs to manufacture and process carbon steel and stainless steel for manufacturers throughout North America.
So far, the BP oil spill has taken a more personal than professional toll on the electrical contractors, but some have done some incidental work for BP or state cleanup crews, such as in providing power connections for the cleanup machinery being used along the Mississippi coastline.
“That’s incidental work, however,” Russell said, adding that none of it is being done by his company.
Some electrical contractors raised their prices after the storm, and that pricing has put some of them out of work, Landers speculated, as traveling contractors vied for the same projects. Those contractors succeeding in the area agree that changing their focus has kept their doors open, and growth in the economy nationally will affect their own future growth in the region. Five years after Katrina, everything’s different.
SWEDBERG is a freelance writer based in western Washington. She can be reached at email@example.com.