Trying to Reason With the Hurricane Season


Hurricane Matthew, with strong winds and driving rain, was expected to cause significant damage along the Southeast coast in Florida, South Carolina and North Carolina. An analysis by the Bureau of Labor Statistics showed that in Florida, for example, about 127,000 businesses were in potential flood zones. Those businesses employed about 1.4 million workers, the bureau said.

“Having information on the employment and establishments in a storm’s path can help professionals understand the storm’s potential economic impact and prepare for emergency response,” the bureau said in a statement Oct. 6.

The bureau drew its estimates from a quarterly census of employment and wages, a program that was created with maps and data for hurricane zones on the Atlantic and Gulf coasts.

Concerns for people, and property are top priorities for employers, but so is ensuring that the company’s payroll process continues to function and that workers are paid correctly and on time. Based on the BLS data, employers should realize the potential cost of natural disasters.

Of course, during a major storm is no time to start setting up disaster preparations, so employers should take time during the year to plan for contingencies. The Atlantic hurricane season spans June 1 to Nov. 30, so there still is time after Matthew subsides to establish a disaster program, as this blog has previously discussed.

Keep in mind, too, that major storms often are followed by weeks or months of recovery from destroyed buildings, lack of power and water and impassable streets and highways. Hurricane Katrina, which in August 2005 battered the Gulf Coast, especially New Orleans, was the most catastrophic natural disaster in U.S. history, killing more than 1,800 people, mostly in Louisiana, and causing $108 billion in damage from high winds and widespread flooding, the Federal Emergency Management Agency said.

And the effects of a natural disaster may be long-lasting: During the two months after landfall of the category 1 hurricane, nonfarm employment plummeted by 185,700 jobs, or 29.8 percent, from 621,700 to 436,000, a Bloomberg BNA analysis of Labor Department data showed.  

In fact, the New Orleans area still has not recovered from the economic destruction caused by Katrina, the analysis said In October 2005, about two months after the hurricane hit Louisiana, the low point in terms of employment gains for the area, employment gains remained uneven until 2011, after which they have slowly risen.

About 100,000 jobs were added in the New Orleans area from October 2005 to October 2007. However, 900 jobs were added from October 2007 to October 2010, a period that included the recent recession. Growth since has been slow, with 27,200 jobs added by July 2016, the analysis said. 

Unemployment, meanwhile, ranged from 3.4 percent to 4.8 percent from 2006 to 2008, peaking at 8.7 percent by the time the recession ended in the second quarter of 2009. Unemployment in the area now is 6.7 percent, the BLS said.

Safety is paramount during a natural disaster, so employers should make that job No. 1. After the storm clears and the cleanup has begun, payroll department should start thinking about a recovery plan, because the next disaster may be just around the corner.

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