Gateway Plumbing and Heating co-owner, John Cataneo is busy working with his current twenty employees day and night, but still cannot keep up with the orders from clients, who need plumbing repaired after the destructions caused by Hurricane Sandy. He says he has hired two more people and might need more workers.
He revealed that his group is not able to reach the people who really need their support, but still they are doing their level best. His experience shows how the superstorm is affecting the Northeast region, and rest of the nation. An economic improvement may outdo the loss of business it has caused. Renovation and buying and hiring more workers ranging from $150 to $250 billion may improve economic growth by 0.5% over the next year, with the assumption of 50 billion in total losses, as per the forecasting firm Economic Outlook Group.
Economic Outlook chief global economist, Bernard Baumohl said that reconstruction costs will be more than the replacement as a lot of work has to be done to get it to original structure. He said construction has been ramped up and it would bring in many jobs and there will be a high demand for materials or things of all kind, stimulating the economy further.
Estimates of insured breakdown caused by the storm range from nearly $7 to $25 billion. If lost sales and wages are accounted for, the total loss would cross $50B, according to Equecat firm.
An economist from Goldman Sachs said that the superstorm may drop the economic growth by 0.25% to 0.5 in the last quarter after having disturbed retail sales, industrial production, and employment. Most of the repair works are to take place in the early 2013, adding to the growth front.
“Insurance claims government funds and payments will boost the economy for next 2 to 3 years, after the Sandy knockout” said FM Global chief financial officer, Jeff Burchill.
According to him, a lot of building and reconstruction is coming into the picture due to Sandy that otherwise wouldn’t have actually occurred. San Francisco based economist at Wells Capital, Gray Schlossberg said renovation after the Sandy has an effect similar to government sponsored stimulus scheme. He said that the ripple effects of the spending could leave the nation further ahead of where it was, before Sandy’s hit – so, it has come as a blessing in disguise in a way!