This week marks the two-year anniversary of Hurricane Sandy, one of the most costly and devastating storms to hit the Eastern Seaboard. The storm caused more than $65 billion in physical damages, and many businesses faced additional losses from economic disruption. As climate change continues to cause extreme weather, the probability of another storm like Hurricane Sandy is increasingly more likely. To better prepare businesses for natural disasters, the Federal Emergency Management Agency (FEMA) is working to help businesses develop their own specific disaster strategy.
To learn more about FEMA resources and its tools for resiliency, response, and recovery, please join Business Forward on Thursday, November 13 from 12:00 p.m. to 12:45 p.m. ET for a Webinar with Jeanie Moore, Acting Director, Private Sector Division, Federal Emergency Management Agency.
> Register Here
Here’s a look at the harm Hurricane Sandy caused across different sectors of the economy.
Tourism: Because the storm hit tourism-dependent areas like New Jersey’s boardwalks and New York City, the tourism losses were devastating for some businesses. Rutgers estimated that New Jersey’s tourism industry experienced $950 million in losses as a result of Hurricane Sandy. While the short-term tourism industry effects in New York City were harmful, the city was able to recover more quickly than some of the other affected areas. The gaming industry in Atlantic City lost an estimated $5 million per day in revenue because of closures from Sandy, which led to a 28 percent drop in revenue during the month of November—the biggest monthly drop in 34 years.
Manufacturing: Sandy affected an estimated 10,000 separate manufacturing facilities. As Business Forward found in a report on severe weather and its effects on the manufacturing industry, American manufacturers rely on interdependent supply chains which are more susceptible to severe weather. Even if a manufacturing facility avoided damage from Sandy, its suppliers may have been affected, slowing down the entire supply chain.
Fishing: Losses were as high as $105 million in recreational fishing and almost $14 million in the commercial fishing sector in New Jersey as a result of Sandy. In New York, damages to the recreational fishing sector totaled $58 million, while damages to the commercial fishing sector totaled $19 million. This caused a ripple effect on area restaurants that source fish locally.
Commercial Trucking Industry: An estimated 20 percent of the commercial trucking industry was stalled in the week after the storm with losses of $140 million per day. As part of rebuilding efforts, the trucking industry gained some new business, possibly leading to a net gain for the sector.
The U.S. Department of Energy estimated that power outages as a result from Sandy left eight million people without power in states as far south as South Carolina. The hardest hit areas were without power for more than two weeks. Flooding made it difficult to repair damages, and exposure to salt water caused electrical systems to short circuit. Many businesses and large-scale operations such as sewage treatment plants turned to generators for power.
As destructive as Hurricane Sandy was, climate change could cause the next Sandy-level storm to inflict even more damage. Hurricane Sandy caused $19 billion in losses for New York City alone, as a rare, but not unprecedented 1-in-70-year storm. Scientists predict climate change will make rare storms like Hurricane Sandy more frequent and more devastating because rising sea levels will increase the reach . By that time, a 1-in-70-year storm would be projected to cause nearly five times the losses of Hurricane Sandy, according to reinsurer Swiss Re.
FEMA has worked with New York City to update Flood Insurance Rate Maps (FIRMs) to help improve communication about current flood risks. FEMA has also provided more than $1.7 billion for projects to protect against future disaster damage. In 2013, President Obama signed the Sandy Recovery Improvement Act into law. The law authorizes several significant changes to the way FEMA delivers federal disaster assistance to survivors. The National Strategy to Reduce Costs on Future Disasters, one part of the Sandy Recovery Improvement Act, addresses vulnerability to damage and includes recommendations on improving resiliency.
Will your business be prepared for the next Hurricane Sandy?
Please join Business Forward on Thursday, November 13 from 12:00 p.m. to 12:45 p.m. ET for a Webinar with Jeanie Moore, Acting Director, Private Sector Division, Federal Emergency Management Agency, to discuss disaster preparedness for businesses.
> Register Here