Katrina May Cut Payrolls by 500,000 This Month (worst decline in 30 years)

[Bush_Eats_Beef]

http://quote.bloomberg.com/apps/news?pid=10000006&sid=ai3f4_4Rf_DU&refer=home

Sept. 2 (Bloomberg) -- Hurricane Katrina may cost 500,000 Americans their jobs this month, the biggest decline in payrolls in more than 30 years and a loss that will show up as early as next week in jobless claims figures, economists said.

``There are currently more than a million displaced people, and I don't expect many of them to be back at work by the time of the September payroll survey,'' said Ian Shepherdson, chief U.S. economist at High Frequency Economics in Valhalla, New York. Shepherdson estimated the drop in payrolls this month may reach half a million, the biggest decline since December 1974.

Because Katrina struck at the end of the month, it didn't influence August payrolls, which showed a 169,000 increase in jobs and a drop in the unemployment rate to a four-year low of 4.9 percent, the Labor Department said today. The ravaged Gulf Coast cities of New Orleans, Biloxi, Mississippi and Mobile, Alabama, account for about 1 million jobs, according to economists at Stone & McCarthy Research Associates in Princeton, New Jersey.

The government surveys businesses for the pay period that includes the 12th of the month. A worker is considered employed if he or she worked for at least one day during that time. ``It is hard to imagine that too large a percentage of these jobs will be sustained over the next few weeks,'' said Ray Stone, managing director at Stone & McCarthy, in a research report. ``Perhaps several hundred thousand'' of the workers in the region won't be able to return to their jobs soon enough to be counted as employed, Stone said.

[bluestateguy]

1. Unemployment benefits must be extended

I don't want to hear any free market bullshit right now. There is no place for that kind of stuff now.

[EVDebs]

3. Right on. Thomas Friedman and Fareed Zakaria

and the rest of the free market-globalization crowd need to register as foreign agents like Billy Carter had to do !

[TheCentepedeShoes]

2. How will people file for unemployment?

If it's administered by the state and someone has sought shelter in another state, are they going to be able to file at their new location? I've been fortunate enough to never need to use unemployment insurance (there but for...)so I don't know the procedure. Just thinking it could be an enormous nightmare on top of nightmare.

[unlawflcombatnt]

4. Thanks for the article

It's interesting that they had to quote an overly optimistic economist in the article, to get a "balanced" approach. He claimed that payroll growth will be reduced by about 100,000 per month for a couple of months. Which is simply ridiculous, if you're subtracting jobs lost from those numbers.

500,000 workers are out of work in the New Orleans area alone. 1 million are out of work in entire hurricane-affected area. New Orleans cannot even begin rebuilding until the city is drained. And they can't begin draining until they repair the levies. It will be at least a month, and maybe much longer, until New Orleans is even drained. Meanwhile, all the people who lost jobs will still be out of jobs, because their jobsites are underwater. That sounds like at least a month with 500,000 less jobs than before. And many of those jobs will never come back. It sure sounds like more than a 100,000 decline in payroll jobs to me.