by Lindy Davies
Although a whole lot of people are enduring a whole lot of loss and suffering in the aftermath of the SuperStorm, the news isn’t 100% bad. People who have been looking for work in metro NYC will start having a bit better luck.
Federal disaster relief for cleanup after Hurricane Sandy will bring in an immediate $27.8 million. Hiring is already beginning. To be eligible, workers must be unemployed as a result of Hurricane Sandy or unemployed and not receiving unemployment benefits or other types of income support. This is likely to provide a short-term boost to many of the New York region’s neediest people.
Also, ConEd is seeking 900 temporary safety inspectors across New York City, at $25 per hour. The MTA will be hiring many temporary workers, paid for by FEMA and its own insurance. The need to very quickly address Sandy’s damage will provide real economic benefits. CBS News reported:
“This storm is going to be a shot in the arm economically speaking,” said Jim Angleton of AEGIS FinServ, which helps companies issue pre-paid debit and credit cards. “This storm and its damage, power loss and huge inconvenience will actually be beneficial in less than seven days.”
Research firm Capital Economics said the initial impact on the U.S. economy could be large. The 12 New England and Mid-Atlantic states affected by the storm account for nearly a quarter of the nation’s economic output, with the New York metropolitan area alone contributing 10 percent of GDP. But firm chief economist Paul Ashworth expects the recovery effort to largely offset the hit to growth.
But job-seeking New Yorkers are likely to gain longer-term benefits in the aftermath to Sandy. It’s very likely that the storm’s damage will compel state and federal government to implement some form of storm-surge protection. Various ideas are being considered, from rigid gates in the harbor to artificial tidal marshes off Lower Manhattan, and revived oyster-shell reefs to form a natural barrier to rushing waters. A seawall barrier of the sort used in the Netherlands would cost between $10 and $15 billion. That would provide a lot of jobs.
All of the spending we’re talking about here — while it does get people working, which creates demand — is spending on “bads.” It’s what we might call “broken-window” spending. This sort of disaster-relief hiring can be surprisingly economical, because of the permanent force of unemployed workers that our economy keeps standing around. These people are hardly in a position to demand high wages.
The real mystery is why there are so many people unemployed in the first place. One might say, “Oh, well, we’re climbing out of a deep recession. We’ve got eight percent unemployment.” But, back in 2004, when our economy was going great guns, the United States had an unemployment rate of five percent! Yet we can look around and see idle land, and empty buildings. What’s keeping people from utilizing these idle resources to create the goods and services that people want?