Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Snowmageddon could cost up to 150,000 jobs in February

snow_storm.gi.top.jpgBy Chavon Sutton, staff reporter


New York (CNNMoney.com) -- This month's blizzards are battering jobs.

Economists estimate that between 90,000 and 150,000 jobs could be lost in February, as the snow kept people home from work and stalled hiring during the month.

Analysts had been expecting good news on the jobs front, forecasting that payrolls would expand.

Instead, both people who have jobs and those who were set to start new positions couldn't get to work because of the weather. As a result, they'll file for unemployment benefits.

"The storms will have a tangible impact on the hiring process, which is impeded when people can't get out and businesses are closed" said Stefane Marion, National Bank Financial's chief economist. Marion originally expected that the economy would add jobs in February, but he now estimates that a total of 150,000 jobs could be lost because of the storms, at least temporarily.

Deutsche Bank's chief economist Joseph LaVorgna, who had also expected a jobs gain, came to a similar conclusion. On Wednesday he issued a "conservative estimate" that an additional 90,000 jobs could be lost this month due to the weather. But he added that the impact "could be much larger...perhaps double that amount."

Businesses that are hit particularly hard by the weather, such as retail, manufacturing, construction, and transportation, are driving up the job loss estimates.

The storms could break the trend of improving jobs data when this month's jobs report comes out March 5th.

"We were hoping to see a turning point, positive numbers, in payrolls this month," said Marion. "It's unfortunate because the timing of the storms coincided with the reference week that payrolls were calculated."

Both reports used data from the Blizzard of January 1996, which blanketed the northeast in as much as 4 feet of snow, as a benchmark for the February estimates.

"In January 1996, 1.8 million people said they had a job but couldn't go because of the weather," said Deutsche Bank's LaVorgna. "If we translate that into payroll impact this time around, we can see an impact of equal or greater than [in] 1996, when payrolls fell by approximately 160,000."

Still, economists maintain their positive view on the economy, saying the storms' negative impact is a temporary blip and urging people to stay calm.

"Stay the course. The economy won't double dip," said LaVorgna. "Growth will resume pretty strongly once we move past February."  To top of page

Index Last Change % Change
Dow 18,520.04 -27.26 -0.15%
Nasdaq 5,253.19 -6.89 -0.13%
S&P 500 2,183.20 -3.70 -0.17%
Treasuries 1.55 -0.00 -0.32%
Data as of 12:37pm ET
Company Price Change % Change
Bank of America Corp... 15.42 0.08 0.49%
Chesapeake Energy Co... 6.40 -0.06 -0.93%
Freeport-McMoRan Inc... 11.32 -0.66 -5.51%
KeyCorp 12.16 0.01 0.12%
Micron Technology In... 15.79 -0.39 -2.41%
Data as of 12:21pm ET
Sponsors

Sections

Qatar's sovereign wealth fund just purchased a $622 million stake in the company that owns the Empire State Building. It's the latest foreign investment in the iconic Manhattan skyscraper. More

The U.K. is preparing to split from the European Union, which means about $1.3 trillion in trading relationships will have to be reset. More

A group of big banks led by UBS is planning their own version of digital cash, using blockchain, the technology underpinning Bitcoin. More

An impending October rule change by the Securities and Exchange Commission ? a reform that stems from the 2008 financial crisis ? is spurring a mass exodus from some of these funds. More