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Lack of workers, housing slowing New Orleans revival, seminar told

NEW ORLEANS—Downtown New Orleans looked like it was back in business Thursday. Bumper-to-bumper traffic snarled Canal Street. Parking spaces vanished.

"I've never been so glad to see a traffic jam as I was this morning," said Coast Guard Vice Adm. Thad Allen, who's in charge of federal emergency efforts along the Gulf Coast.

The traffic woes on Canal Street in New Orleans were in part due to businesses reopening their doors and by the 1,500 people who came to a seminar intended to help businesses reopen in a city that's been at an economic standstill in the six weeks since Hurricane Katrina.

If anything, the storm has given the city "a once in a 300- or 400-year opportunity" for growing and retooling its economy, Mayor Ray Nagin said. He told seminar participants that rebuilding efforts estimated to pour about $10 billion annually into the area over the next decade would create "an opportunity to create wealth for your children and your children's children."

But the mayor, who ran the local cable TV franchise before moving to City Hall, warned that he saw some problems in the local business scene.

Cheers erupted when Nagin took a shot at companies importing "Mexican workers" to do the cleanup work instead of hiring residents.

Businesses throughout the city have had difficulty reopening and returning to normal operations because of a lack of workers. Some 200,000 homes and apartments were damaged by Katrina, leaving many of those workers unable to return to the city. Even fast-food franchises have raised workers' pay, and local Burger Kings are offering $6,000 bonuses to anyone who will commit to staying a year.

Gov. Kathleen Blanco urged small-business owners to e-mail and call members of Congress—other than those from Louisiana—to support the state in its quest for about $200 million in federal loans to revive some 81,000 businesses shuttered by the storm.

Federal money is needed because it's nearly impossible for businesses that are shut down to get bank loans without collateral or cash flow, Blanco said.

"I don't believe Congress realizes the severity of the problem," Blanco said.

Business people at the seminar said they believe New Orleans is getting back up after being clubbed by Katrina.

Real estate agent Walter Campbell has several closings pending, including the sale of homes to buyers from Colorado and South Carolina. The deals will go through once local government offices that handle title searches reopen, he said.

"I think everyone is ready to get back to business," he said.

Getting workers places to live will determine how quickly New Orleans businesses rebound, said Rob Johnston, an executive of a local construction management firm.

He noted that thousands have been displaced by the storm, including himself.

"I'm confident we have the opportunity to have a better city, a better education system and better health care," Johnston said. "But it will take strong leadership and good planning."


(c) 2005, Knight Ridder/Tribune Information Services.

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