Markets and Economy
Weathering Natural Disasters
New research from the JPMorgan Chase Institute reveals how Hurricanes Harvey and Irma affected the local economies of Houston and Miami through the lenses of consumer financial outcomes, small business resilience and local consumer commerce.
Following two especially damaging natural disasters in 2017—Hurricanes Harvey and Irma—the JPMorgan Chase Institute analyzed the impact of these events on consumer financial outcomes, small business resilience, and local consumer commerce to understand how they affected local economies in the weeks and months after landfall. The findings provide insight into the financial resilience of these communities, and reveal important takeaways for individuals, businesses and policymakers.
The research found that the storms caused major financial disruptions in Houston and Miami:
- For consumers and households: The hurricanes significantly disrupted families’ healthcare spending. During the week of landfall, healthcare payments dropped by more than 50 percent and had not recovered in either Houston or Miami more than two months later. This leaves open key questions as to whether the slowdown in healthcare spending was caused by a drop in demand or disruptions in healthcare supply.
- On local commerce: Houston and Miami both saw steep year-over-year declines in local commerce during the month of landfall. Houston experienced a 7.5 percent decline in August 2017, while Miami experienced a decline of 3.7 percent in September 2017.
- For small businesses: Cash balances for the typical small business dropped by more than 7.4 percent after landfall in Houston and Miami, but recovered within two to three weeks. While resilience is not the same as recovery, the performance of these firms after a material event shows remarkable flexibility in responding to the storms.
Access the full reports for more findings.