Haas Center Studying Hurricane Michael's Economic Jolt
Hurricane Michael is long gone, but the damage it inflicted remains – including the economic damage. WUWF’s Dave Dunwoody looks at an ongoing study by the Haas Business Center.
Michael made landfall near Mexico Beach on October 10 as a strong Category-4 storm, with 155 mph winds and gusts up to 175 mph. It’s likely to become the 12th weather disaster in the United States this year to run up a $1 billion tab according to The Weather Channel.
“For us, we have experience of course in this area knowing what damage could be wrought by a significant hurricane; we all remember Hurricane Ivan,” says Amy Newburn, Assistant Director at the Haas Center.
“As we were all watching our neighbors to the east get slammed by Michael, I think that we wanted to try to start putting a number on this damage,” said Newburn. “We thought we had a unique perspective and ability to be able to do that.”
Researchers at Haas have compiled a “dashboard” that will be updated continuously as new data comes in. It all hinges on the availability of the data and what it looks like. Newburn says the methodology currently includes storm surge losses in Bay and Gulf Counties, along with what happened to the 11-county area’s timber industry.
“This is going to continue to change as we see other insurance claims come through by county; as we start to see these communities rebuild we’ll be taking all that data in,” Newburn says. “But not all these things are updated in real time. That’s why our dashboard will evolve as those figures come in.”
Part of that methodology involves using the “REMI Model.” That’s the acronym for the firm Regional Economic Models, Incorporated. REMI takes the spending in a local economy and traces it through the entire supply chain.
“When I go out and spend a dollar, a part of that goes outside the community to where they have purchased the goods that stock the store,” says Newburn. “Part of that dollar goes to support the employees, and then they go and spend part of that out in the community as well.”
Beginning with Michael’s hardest-hit areas — Bay and Gulf Counties — the Haas study ran the figures through the REMI model and came up with an economic impact estimated at one and a half billion dollars. That includes a short-term loss of employment.
“What we can also expect is a spike in retail sales in their neighboring counties, because they don’t have as many options right now that still have open doors in their own communities,” Newburn says. “So, as they look to rebuild and have to buy supplies to do that, that’s what we expect to see.”
Part of the information in the study is from government sources, such as FEMA and the Florida Office of Insurance Regulation. Newburn says that helps them put all of their economic impact eggs into one basket.
“On our dashboard, we are keeping an updated count of how many insurance claims are going through, as well as how many FEMA assistance applications have been submitted,” said Newburn. “The goal of having our dashboard publicly available is so that local agencies, statewide agencies can all use that.”
However, an economic impact figure is not required for individuals applying to FEMA for help with residential damages.
“For businesses, for non-profits, as they look to apply for grants to get back on their feet, we’re hoping that an economic impact figure and analysis that’s out there and continuously updated would serve as a tool for them,” said Newburn.
Since cleanup and restoration from hurricanes can take months or even years, the Haas Center’s Amy Newburn says the study of Michael’s economic impact will remain – for the foreseeable future – open-ended.
“What happens to tourism and bed tax collections as the season picks up again next spring; even if the community is able to recover quickly, is there still a perception out there that they have been hit?” says Newburn. “Those are just things that we’ll have to monitor as they happen.”
Meanwhile, Hurricane Michael will cost Florida farmers an estimated $158 million because of damaged crops, according to a new study by the University of Florida. Those losses include cotton, nuts, and vegetables, along with beef, dairy and other animal products, across 25 counties.