How Will Hurricane Sandy Affect the Economy?

Libby Kane
Posted

First and foremost, our hearts and best wishes go out to any LearnVesters affected by the hurricane. We sincerely wish you a speedy and safe recovery.

It’s estimated that Hurricane Sandy will cost up to $60 billion, according to forecasting firm IHS Global Insight. That number comes from a combination of the suspended American stock market, lost revenue for businesses and property damage.

Although the loss sounds as dramatic as the storm (did you see this footage of an explosion at a power plant in lower Manhattan?), economists expect Hurricane Sandy to be only a blip on the economy overall.

“The loss of business and wealth caused by the storm will likely end up being roughly balanced out by money that will go into rebuilding and recovery efforts from insurers, the government’s national flood insurance program and private savings,” reports CNN Money.

Small business owners, who will likely see a dip in customer numbers, suffer business-specific losses such as spoiled food at restaurants and have to pay for repairs, will be able to apply for Small Business Association Disaster Loans. These loans are “available for physical damage to businesses as well as economic damage as a result of the natural disaster,” writes NerdWallet. (You can apply here.)

While there are resources to help affected cities and towns recover, it will take a while: The Metropolitan Transit Authority, which runs the massive system of subways and buses in New York City, reports that it may never have faced a disaster of this magnitude and that it may take up to six weeks to get everything back in order.

Update, November 1: The original version of this article estimated that the damage by Hurricane Sandy will be $10-$20 billion, but we’ve updated it to reflect a new estimate of $60 billion. 

Image Credit: Twitter

  • CleoBarker

    I live in Hawaii and its already affecting business here due to delayed shipping because of store damage. Sandy also knocked out a Davids Bridal warehouse, delaying dresses and such for a friends upcoming wedding. I hope everyone on the East Coast is doing okay, I know myself and many people I work with are setting up donations to send out this week.