Experts at AccuWeather say extreme weather events and disasters in the past 12 months have had the costliest and most widespread impacts that Americans have faced in nearly a century.
“The catastrophic wildfires burning in Southern California combined with destructive hurricane impacts last year have been the worst series of natural disasters in America since the Dust Bowl in the 1930s,” AccuWeather Founder and Executive Chairman, Dr. Joel N. Myers, said.
“The Dust Bowl led to a massive migration west to California. Ninety years later, we expect these wildfires, the rising costs of rebuilding and recovery, the challenge of securing and affording insurance, as well as drought and water supply concerns will likely lead to a significant migration out of California over the next few years,” added Myers.
AccuWeather’s revised preliminary estimate of the total damage and economic loss from the fast-moving, wind-driven infernos in Southern California stands at $250 billion to $275 billion.
When combined with the nine additional weather disasters that AccuWeather issued preliminary estimates for in the past 12 months, Myers says AccuWeather estimates that the total damage and economic loss from extreme weather events over the past year has skyrocketed to $693 billion to $799 billion. That figure is equivalent to nearly 3 percent of the United States annual gross domestic product.
AccuWeather’s preliminary estimate for the total damage and economic loss for the wildfires in Southern California is substantially higher than other estimates because many other organisations only focus on insured losses and direct losses.
AccuWeather experts consider the costs of immediate healthcare, long-term physical and mental healthcare, the financial impacts of excess deaths in the years following a disaster, and dozens of additional factors, to provide a more holistic and comprehensive scope of the long-term financial impacts.
“Damage estimates based only on insured losses and direct impacts grossly underestimate the long-term financial losses that families, businesses, and communities endure after a weather disaster,” Myers explained. “There are many compounding factors that can multiply the financial impacts in the months and years after a disaster. Damage estimates that solely consider immediate and insured losses cannot truly capture the immense magnitude of a tragedy like this, especially in a high-risk area where some insurers are canceling policies and leaving thousands of people underinsured or uninsured.”
With thousands of multi-million-dollar properties destroyed in one of the most expensive real estate markets in the nation, Myers said impacts to property values and a loss of tax revenue will have major ramifications for the region’s economy.
“The destructive fires will likely erode the tax base, which could lead to a cutback in public services or higher taxes,” Myers said. “This domino effect could worsen the migration out of California, as more families consider moving to states with lower taxes and a lower risk of wildfires.”
AccuWeather’s total damage and economic loss estimates also factor in cleanup costs, the value of home contents, damage to businesses, and medical facilities, infrastructure and vehicles, as well as temporary wage losses and permanent job losses. AccuWeather total damage and economic loss estimates also account for the financial impact of power outages from utility damage and power outages from planned public safety power shutoffs during wildfire threats, which can result in business disruptions and food spoilage impacting hundreds of thousands of people.
AccuWeather incorporates independent methods to evaluate all direct and indirect impacts of the storm and is based on a variety of sources, statistics and unique techniques AccuWeather uses to estimate the damage. It includes damage to property, job and wage losses, crops, infrastructure damage, interruption of the supply chain, auxiliary business losses and flight delays.
The estimate also accounts for the costs of evacuations, relocations, emergency management and the extraordinary government expenses for cleanup operations and the long-term effects on business logistics, transportation and tourism as well as the health effects and the medical and other expenses of unreported deaths and injuries, as well as the long tail of negative impacts to physical and mental health that survivors may face in the next decade.
