How Hurricanes Affect Employment and Wages in Local Labor Markets
This paper adopts a generalized-difference-in-difference (GDD) technique outlined in Ariel R. Belasen and Solomon W. Polachek (IZA Discussion Paper #2976) to examine the impact of hurricanes on the labor market. We find that earnings of the average worker in a Florida county rises over 4% within the first quarter of being hit by a major Category 4 or 5 hurricane relative to counties not hit, and rises about 1¼% for workers in Florida counties hit by less major Category 1-3 hurricanes. Concomitantly, employment falls between 1½ and 5% depending on hurricane strength. On the other hand, the effects of hurricanes on neighboring counties have the opposite effects, moving earnings down between 3 and 4% in the quarter the hurricane struck. To better examine the specific shocks, we also observe sectoral employment shifts. Finally, we conduct a time-series analysis and find that over time, there is somewhat of a cobweb with earnings and employment rising and falling each quarter over a two-year time period.
|Date of creation:||Mar 2008|
|Publication status:||published in: American Economic Review, 2008, 98 (2), 49-53|
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ariel R. Belasen & Solomon W. Polachek, 2009.
"How Disasters Affect Local Labor Markets: The Effects of Hurricanes in Florida,"
Journal of Human Resources,
University of Wisconsin Press, vol. 44(1), pages -.
- Belasen, Ariel R. & Polachek, Solomon, 2007. "How Disasters Affect Local Labor Markets: The Effects of Hurricanes in Florida," IZA Discussion Papers 2976, Institute for the Study of Labor (IZA).
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