Katrina: Could Cost Us 400,000 Jobs

The devastation left by Hurricane Katrina could cost the U.S. economy an initial loss of 400,000 jobs in September and reduce monthly average job creation by 30,000 jobs for the rest of 2005. It could also increase the price of oil by $10 a barrel and lead to a nearly one percent decline in GDP growth in the fourth quarter of this year.

But next year, reconstruction efforts will turn things around – adding back those 30,000 jobs per month, easing the price of oil and increasing the GDP by more than a percentage point during the second and third quarters.

These are the preliminary findings of two Milken Institute regional economists who’ve studied the potential impact of Katrina on the U.S. and Gulf Coast economies. Their insights are based on extensive research and knowledge of the economic impacts of natural disasters and terrorist attacks, such as 9/11.

More here.