According to USA Today, Hurricane Harvey could be causing a halt to the Houston region in Texas. A region that has a vital part in the US economy. The Houston region was recently making a recovery from the oil crash in 2014-2016.
Moody's Chief Economists, Mark Zandi says that the property damage of the storm, which was estimated at 30 to 40 billion dollars, could take up to two years to fix. With that, the Houston region had a projected gross output of about 441 billion dollars, which covers roughly 2.4% of the nations economy. This storm has caused many problems in the region of Houston and in many other regions around it. But, since Houston was such a big part of the United States economy and the state of Texas economy, Hurricane Harvey will definitely be felt months after the Hurricane is done in the region of Houston.
One of my final observations about this article is the fact that since the oil halt in 2014-2016, about 77,000 jobs were lost in many different industries. Some of the industries include, mining, manufacturing, and wholesale trade. Of those jobs lost only about 7,000 jobs were recovered and this was before the Hurricane hit. This could pose some problems for those who have lost their jobs due to the oil halt, and now due to the recent Hurricane that hit.
This article also touches on the regions major major industries. Some of these industries such as, Energy, Automotive, and Airports all use oil in some way. Which looks to be a common theme when in comes to Houston.
Overall, this hurricane could hurt our economy for some time. With that, there is no reason that the region of Houston cannot recover as it was doing since 2016. The question that remains is how long until Houston and the state of Texas starts to recover again?
https://www.usatoday.com/story/money/2017/08/28/harvey-deals-blow-houston-key-gear-u-s-economic-engine/609798001/
Obviously the Hurricane is devastating and the loss of $30-40 billion is crucial to the economy. Knowing you aren't the author, I think it will take longer than 2 years to fix. Which will cause the 2.4% of US economy to slowly come back to carry its full weight. As Hurricane Katrina showed us, the devastation from these storms can last for years and affect many. There is also the possibility that some people move to other areas of the country. Inevitably, if everyone is able to find new jobs and begin to affect markets, the country will recover. Natural disasters like this are terrible tragedies but allow economists to judge the stabilization of markets during these times.
ReplyDeleteAlthough you make a valid point. I think that with all of the money that is being donated to the Hurricane Harvey cause, it could be done within two years or soon after. The jobs may take a little longer to fix, like you said, because of people having to move and so on. But in terms of the property damage, I think it is possible to have most of it fixed within the two years. I do agree though, Katrina showed us the damage it can and will do and it does allow economists to judge the markets.
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