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US Economy Hit Hard by Widespread Winter Storm
27 Jan
Summary
- Winter storms cause billions in economic disruption annually.
- AccuWeather estimates storm costs at $105-$115 billion.
- Lost commerce and power outages are major economic impacts.
The severe winter storm blanketing the American East is exacting a substantial economic cost, with estimates of disruption reaching into the billions of dollars. Calculating the economic impact of weather events like this, which disrupt transportation and power grids, proves more challenging than quantifying damage from hurricanes or fires. Researchers suggest that severe weather collectively can reduce the U.S. gross domestic product by 0.5% to 2% annually.
One private company, AccuWeather, has estimated the storm's economic toll to be between $105 billion and $115 billion. This figure, attributed to disruptions in commerce and power outages, has been met with skepticism by other experts who find it excessively high. The storm has caused widespread power outages, affecting hundreds of thousands of people, and has grounded thousands of flights, impacting air travel.
While the storm is expected to cost multiple billions, potentially becoming the nation's first billion-dollar weather disaster of 2026, it is unlikely to reach AccuWeather's highest estimates. For context, the most expensive U.S. winter storm on record, the 2021 Texas ice storm, cost approximately $26 billion. Unlike hurricanes or fires that cause direct damage to physical structures, the economic losses from snow and ice storms are often more amorphous, involving lost opportunities rather than easily quantifiable insurable losses.
