The Effects of Devastating Tornados on Employment and Income

Abstract

<p>Tornados can be some of the most devastating natural disasters. Understanding the effects of said devastation is important for planning for extreme weather. Using a difference-in-differences regression method, this paper highlights the impacts of the most devastating tornados across the United States on employment, income, and wages for the effected area and the surrounding communities. The results imply some growth in employment and wages one year following the extreme tornado event, while income has little to no change. It could be that certain labor sectors experience growth in the job market, while others see no change or a decline. Overall, the results show that when a damaging tornado strikes, the affected community will experience miniscule growth in employment and wages.</p>