As we recuperate from a recent hurricane in Puerto Rico and hurricane Ian is still making its way out in Florida, we reflect on the effect on the local and national economy of these natural disasters.
Hurricanes Irma and Maria hit Florida and Puerto Rico hard in 2017, causing widespread damage and leaving millions of people without power. The hurricanes also took a toll on the economies of both states. This blog post will take a look at how the hurricanes affected the economy in Florida and Puerto Rico, as well as what steps are being taken to help rebuild.
Florida's Economy
Florida is the third largest state in the United States and is home to some of the nation's most popular tourist destinations, including Orlando, Tampa, and Miami. The state's economy relies heavily on tourism, which took a major hit after Hurricane Irma. Although the state has developed into a different economy these last years with big Fortune 1000 companies moving their offices here, tourism is still a huge industry and big piece of the financials of the state. According to estimates from economists, the hurricane cost Florida upwards of $100 billion in damages back then. This includes not only the physical damage to infrastructure and property but also lost tourist revenue.
In the months following the hurricane, Florida saw a sharp drop in tourism. Hotel occupancy rates fell by double digits, and airlines reported fewer passengers flying into the state. As a result of this decrease in tourism, Florida's economy took a hit. however, it is expected to rebound in 2018 as travel picks back up again.
Aside from this, real estate gets affected by insurance companies going broke, closings delayed for months on occasions due to delays on new appraisals or repairs so that the house can pass inspection. It could even affect the price of the homes in the area if they got flooded.
Puerto Rico's Economy
Puerto Rico is a US territory located in the Caribbean Sea. The island was devastated by Hurricane Maria, which caused widespread damage and left millions of people without power. According to economists, the hurricane could cost Puerto Rico up to $95 billion in damages. This is more than twice the amount of what was lost during Hurricane Katrina, which hit Louisiana in 2005.
Puerto Rico's economy was already struggling before Hurricane Maria hit. The island had been in recession for more than 10 years, and its unemployment rate was nearly double that of the mainland United States. The hurricane exacerbated these problems by causing widespread damage to infrastructure and property, as well as disrupting trade and commerce. In the months following the hurricane, Puerto Rico's economy continued to shrink as businesses closed their doors for good.
Right now, Puerto Rico recuperates from yet another hurricane disaster and damages will make more than one think about their investments in the island affecting the people of Puerto Rico who seemed to be catching up after the impact that COVID also had on their local economy.
Conclusion:
The hurricanes that hit Florida and Puerto Rico in 2017 caused widespread damage and left millions of people without power. The hurricanes also took a toll on the economies of both states, with estimated damages reaching into the billions of dollars. While both economies have begun to rebound, it will take many years for them to fully recover from the devastation caused by these natural disasters, and with these new hurricanes we had in 2023 it is hard to calculate how much they will be affected.
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