Abstract
We use data from the monthly Current Population Survey to examine the short- and longer-term effects of Hurricane Katrina on the labor market outcomes of prime-age individuals in the most affected states—Alabama, Florida, Louisiana, and Mississippi— and for evacuees in any state. We focus on rates of labor force participation, employment, and unemployment, and we extend prior research by also examining rates of self-employment. With the exception of Mississippi, employment and unemployment one year after the hurricane were at similar rates as the end of 2003. This aggregate pattern of labor market shock and recovery has been observed for other disasters but masks important differences among subgroups. Those evacuated from their residences, even temporarily, were a harder-hit group, and evacuees who had yet to return to their pre-Katrina state up to one year later were hit especially hard; these findings hold even after controlling for differences in observable characteristics. We also find evidence of an important role for self-employment as part of post-disaster labor market recovery, especially for evacuees who did not return. This may result from poor job prospects in the wage and salary sector or new opportunities for starting businesses in the wake of Katrina.
References
Alesch, D.J. (
2003
). Complex Urban Systems and Extreme Events: Toward a Theory of Disaster Recovery
. Fairfax, VA
: Public Entity Risk Institute
.Alesch, D.J., J.N. Holly, E. Mittler, and R. Nagy. 2001a. “When Small Businesses and Not-for-Profit Organizations Collide With Environmental Disasters.” Paper presented at The First Annual IIASA-DPRI Meeting Integrated Disaster Risk Management: Reducing Socio-Economic Vulnerability, IIASA, Laxenburg, Austria.
-. 2001b. “Organizations at Risk: What Happens When Small Businesses and Not-for-Profits Encounter Natural Disasters.” Technical report. Public Entity Risk Institute, Fairfax, VA.
Blanchflower, D.G. (
2000
). Self-employment in OECD Countries
. Labour Economics
, 7
, 471
–506
. 10.1016/S0927-5371(00)00011-7Blanchflower, D.G., & Oswald, A.J. (
1998
). What Makes an Entrepreneur?
. Journal of Labor Economics
, 7
, 471
–506
.Brown, S.P., Mason, S.L., & Tiller, R.B. (
2006
). The Effect of Hurricane Katrina on Employment and Unemployment
. Monthly Labor Review
, 129
(8
), 52
–69
.Cahoon, L.S., Herz, D.E., Ning, R.C., Polivka, A.E., Reed, M.E., Robison, E.L., & Weyland, G.D. (
2006
). The Current Population Survey Response to Hurricane Katrina
. Monthly Labor Review
, 129
(8
), 40
–51
.Clayton, R.L., & Spletzer, J.R. (
2006
). Working Mobility Before and After Hurricane Katrina
. Monthly Labor Review
, 129
(8
), 11
–21
.Cutter, S.L., Emrich, C.T., Mitchell, J.T., Boruff, B.J., Gall, M., Schmidtlein, M.C., Burton, C.G., & Melton, G. (
2006
). The Long Road Home: Race, Class, and Recovery From Hurricane Katrina
. Environment
, 48
(2
), 8
–20
.Dixon, L., J.W. Macdonald, and J. Zissimopoulos. 2007. “Commercial Wind Insurance in the Gulf States: Developments Since Hurricane Katrina and Challenges Moving Forward.” RAND Occasional Paper OP-190-ICJ. RAND Corporation, Santa Monica, CA.
Elliott, J.R., & Pais, J. (
2006
). Race, Class, and Hurricane Katrina: Social Differences in Human Response to Disaster
. Social Science Research
, 35
, 295
–321
. 10.1016/j.ssresearch.2006.02.003Ewing, B.T. and J.B. Kruse. 2005. “Hurricanes and Unemployment.” Working paper, The Center for Natural Hazards Research, East Carolina University.
Ewing, B.T., Kruse, J.B., & Thompson, M.A. (
2003
). A Comparison of Employment Growth and Stability Before and After the Fort Worth Tornado
. Environmental Hazards
, 5
, 83
–91
. 10.1016/j.hazards.2004.05.002Ewing, B.T., Kruse, J.B., & Thompson, M.A. (
2003
). Employment Dynamics and the Nashville Tornado
. Journal of Regional Analysis and Policy
, 34
, 47
–60
.-. 2004. “An Empirical Examination of the Corpus Christi Unemployment Rate and Hurricane Bret.” Working paper. The Center for Natural Hazards Research, East Carolina University.
Ewing, B.T., Kruse, J.B., & Thompson, M.A. (
2009
). Twister! Employment Responses to the 3 May 1999 Oklahoma City Tornado
. Applied Economics
, 41
, 691
–702
. 10.1080/00036840601007468Frankenberg, E., McKee, D., & Thomas, D. (
2005
). Health Consequences of Forest Fires in Indonesia
. Demography
, 42
, 109
–29
. 10.1353/dem.2005.0004Frey, W.H., & Singer, A. (
2006
). Katrina and Rita Impacts on Gulf Coast Populations: First Census Findings
. Washington, DC
: Brookings Institution
.Garber, M., Unger, L., White, J., & Wohlford, L. (
2006
). Hurricane Katrina’s Effects on Industry Employment
. Monthly Labor Review
, 129
(8
), 22
–39
.Groen, J.A., & Polivka, A.E. (
2008
). The Effect of Hurricane Katrina on the Labor Market Outcomes of Evacuees
. American Economic Review Papers and Proceedings
, 98
(2
), 43
–48
. 10.1257/aer.98.2.43Groen, J.A., & Polivka, A.E. (
2008
). Hurricane Katrina Evacuees: Who They Are, Where They Are, and How They Are Faring
. Monthly Labor Review
, 131
(3
), 32
–51
.-. 2009. “Going Home After Hurricane Katrina: Determinants of Return Migration and Changes in Affected Areas.” BLS Working Paper No. 428. Bureau of Labor Statistics, Washington, DC.
Guimaraes, P., Hefner, F.L., & Woodward, D.P. (
1993
). Wealth and Income Effects of Natural Disasters: An Econometric Analysis of Hurricane Hugo
. Review of Regional Studies
, 23
, 97
–114
.Kosanovich, K. (
2006
). The Labor Market Impact of Hurricane Katrina: An Overview
. Monthly Labor Review
, 129
(8
), 3
–10
.Kroll, C.A., J.D. Landis, Q. Shen, and S. Stryker. 1991. “Economic Impacts of the Loma Prieta Earthquake: A Focus on Small Business.” Studies on the Loma Prieta Earthquake No. 3. The University of California Transportation Center, University of California, Berkeley.
Manser, M.E., & Picot, G. (
1999
). The Role of Self-employment in U.S. and Canadian Job Growth
. Monthly Labor Review
, 122
(4
), 10
–25
.Moore, C.S., & Mueller, R.E. (
2002
). The Transition From Paid to Self-employment in Canada: The Importance of Push Factors
. Applied Economics
, 34
, 791
–801
. 10.1080/00036840110058473Pielke, R.A., Gratz, J., Landsea, C.W., Collins, D., Saunders, M.A., & Musulin, R. (
2008
). Normalized Hurricane Damages in the United States: 1900–2005
. Natural Hazards Review
, 9
(1
), 29
–42
. 10.1061/(ASCE)1527-6988(2008)9:1(29)Rodgers, J.L., St. John, C.A., & Coleman, R. (
2005
). Did Fertility Go up After the Oklahoma City Bombing? An Analysis of Births in Metropolitan Counties in Oklahoma, 1990–1999
. Demography
, 42
, 675
–92
. 10.1353/dem.2005.0034Rodriguez, H., Quarantelli, E.L., & Dynes, R. et al (
2006
). Handbook of Disaster Research
. New York
: Springer
.Sastry, N. (
2002
). Forest Fires, Air Pollution, and Mortality in Southeast Asia
. Demography
, 39
, 1
–23
. 10.1353/dem.2002.0009Sastry, N. (
2009
). Tracing the Effects of Hurricane Katrina on the Population of New Orleans: The Displaced New Orleans Residents Pilot Study
. Sociological Methods and Research
, 38
, 171
–96
. 10.1177/0049124109339370Schuetze, H.J. (
2000
). Taxes, Economic Conditions and Recent Trends in Self-employment: A Canada-U.S. Comparison
. Labour Economics
, 7
, 507
–44
. 10.1016/S0927-5371(00)00012-9Schuster, M.A., Stein, B.D., Jaycox, L.H., Collins, R.L., Marshall, G.N., Elliott, M.N., Zhou, A.J., Kanouse, D.E., Morrison, J.L., & Berry, S.H. (
2001
). ANational Survey of Stress Reactions After the September 11, 2001, Terrorist Attacks
. New England Journal of Medicine
, 345
, 1507
–12
. 10.1056/NEJM200111153452024Simpson, W. and R. Sproule. 1998. “Econometric Analysis of Canadian Self-employment Using SLID.” Income and Labour Dynamics Working Paper No. 98-16. Statistics Canada, November.
Skidmore, M., & Toya, H. (
2002
). Do Natural Disasters Promote Long Run Growth?
. Economic Inquiry
, 40
, 664
–87
. 10.1093/ei/40.4.664Smith, S.K., & McCarty, C. (
1996
). Demographic Effects of Natural Disasters: A Case Study of Hurricane Andrew
. Demography
, 33
, 265
–75
. 10.2307/2061876Tierney, K.J. 2003. “Conceptualizing and Measuring Organizational and Community Resilience: Lessons From the Emergency Response Following the September 11, 2001 Attack on the World Trade Center.” Preliminary Paper No. 329. University of Delaware Disaster Research Center, Newark, DE.
Tierney, K.J., & Bruneau, M. (
2007
). Conceptualizing and Measuring Resilience: A Key to Disaster Loss Reduction
. TR News
, 250
, 14
–17
.U.S. Department of Commerce, NOAA Satellite and Information Service. 2006. “Climate of 2005 Atlantic Hurricane Season.” Available online at http://www.ncdc.noaa.gov/oa/climate/ research/2005/hurricanes05.html.
Vigdor, J.L. 2007. “The Katrina Effect: Was There a Bright Side to the Evacuation of Greater New Orleans?” The B.E. Journal of Economic Analysis and Policy (Advances) 7(1): Article 64. Available online at: http://www.bepress.com/bejeap/vol7/iss1/art64.
Webb, G.R., Tierney, K.J., & Dahlhamer, J.M. (
2000
). Business and Disasters: Empirical Patterns and Unanswered Questions
. Natural Hazards Review
, 1
(2
), 83
–90
. 10.1061/(ASCE)1527-6988(2000)1:2(83)Webb, G.R., Tierney, K.J., & Dahlhamer, J.M. (
2002
). Predicting Long-term Business Recovery From Disaster: A Comparison of the Loma Prieta Earthquake and Hurricane Andrew
. Environmental Hazards
, 4
, 45
–58
. 10.3763/ehaz.2002.0405Wright, J.D., & Rossi, P.H. (
1981
). Social Science and Natural Hazards
. Cambridge, MA
: Abt Books
.© Population Association of America 2010
2010
Issue Section:
Articles
