Preliminary data on the total cost of damage caused by Hurricanes Harvey and Irma is finally coming in, and analysts are projecting hundreds of billions in losses thanks to the damage caused by both weather events.
The latest economic impact prediction by AccuWeather for both storms pegs the total damage at around $290 billion.
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Experts claim that the economic effect of Harvey alone – in the running as one of the costliest storms in US history – is expected to take a huge hit on the country’s economic growth in the third quarter.
In a report on the company’s website, AccuWeather president Joel Myers said that approximately $100 billion of the $290 billion in estimated damage is from Irma. By contrast, Citigroup this week reduced its estimate of total losses for Irma, to $50 billion from an earlier projection of $150 billion.
“The hurricane season is only halfway through, so that number could increase,” warned Citigroup analyst James Naklicki.
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According to a report from Ball State’s Center for Business and Economic Research, the estimated total damage from Harvey in nine Texas counties is $198.63 billion. Ball State’s estimate covers Houston’s metro area, but does not take into account other areas that were damaged by Harvey, such as Beaumont, Port Arthur, and Rockport, explained Ball State economist Michael Hicks.
Hicks told San Antonio Express-News that if damage beyond the Houston metro area was considered, it would add another $20 billion to the total.
“It is likely that damages from Hurricane Harvey are, as of Sept. 8, 2017, the most costly in history,” Hicks said, comparing Harvey’s $198 billion estimate to Katrina’s $194 billion (adjusted for inflation).
The Ball State economist also pointed out that the damages in the Houston area alone could reduce US economic growth by a quarter of 1% in Q3 2017, from a projected 3.4% annual rate to 3.15%.
“While that is not welcome, even if it is that bad, it will be made up in the next couple of quarters,” Hicks assured. “Contractors are descending on Houston. Activity will pick up and cause some growth to offset that.”
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