Obtain the data you need to make the most informed decisions by accessing our extensive portfolio of information, analytics, and expertise. Sign in to the product or service center of your choice.
Hurricane Florence currently is approaching the Carolinas as a
category 2 hurricane. Landfall is expected later tonight or
tomorrow. Authorities are warning of lifethreatening storm surges,
catastrophic flooding, and damaging winds, and a mass evacuation is
underway. We hope our clients and readers in the region stay safe.
Below we provde a little insight into the economic impact of the
storm.
Impact on GDP
While its too soon to gauge the impact on GDP from Hurricane
Florence, past experience suggests only a modest hit to
third-quarter GDP growth and a modest boost to fourth-quarter
growth.
Hurricanes, while having a devastating impact in directly
affected areas, also give rise to activity that otherwise would not
take place. Prime examples include preparation, travel and lodging
associated with evacuation, and recovery.
Another possible offset is geographically re-sourced activity.
That is, with a few days of notice, business can re-source activity
away from potentially affected areas to businesses in other areas
that can "pick up the slack."
Impact on employment figures
The impact of Hurricane Florence on payroll employment is likely
to be small to nil: a person is counted as employed in the payroll
survey if they worked or received pay for any portion of their pay
period that includes the 12th of the month. For any normal pay
period (weekly, biweekly, semimonthly, and monthly), if a person
was working on Monday, they worked for at least one day of their
pay period that includes the 12th. Therefore, they will be counted
as employed in September even if they evacuated on Tuesday.
Hurricane Florence could show up in hours worked and average
hourly earnings: the payroll survey keeps tabs on pay and hours
worked, and salaried individuals who are temporarily away from work
due to storm disruptions will experience a temporary jump in
earnings per hour.
Hurricane Florence probably will not show up in the headline
unemployment figures: those temporarily displaced this week will be
counted as employed in September as long as their job is not
terminated.
Posted 14 Sep 2018 by Ben
Herzon, Ph.D., Executive Director, Macroeconomic Advisers by
IHS Markit and Joel
Prakken, Ph.D., Chief US Economist and co-head of US Economics,
Macroeconomic Advisers by IHS Markit
