September 11's Economic Legacy

http://www.businessweek.com/bwdaily/dnflash/content/sep2006/db20060911_905042.htm

The New York City economy is expected to lose an estimated 108,500 jobs

within the first month following the September 11 attack on the World Trade

Center as a direct result of the attack. This is approximately 2.4 % of total local

employment (including full-time, part-time and self-employment). This

employment estimate encompasses direct, indirect and induced effects to

estimate the total economic impact.

The three industries with the greatest job impacts are securities, retail trade

and restaurants. Securities was the most heavily impacted in the immediate

vicinity of the Trade Center. Numerous restaurants were destroyed or forced

to close and others cut staff due to the spillover effects on tourism and

business travel. Retail trade (excluding restaurants) has also suffered as a

result of the direct effect of the attack and its aftermath on consumer spending.

The total lost output to the New York City economy from the World Trade

Center attack is estimated at $16.9 billion. The total lost value-added in the

local economy is estimated at $11.7 billion, or 3.1% of the total value-added in

the city economy in the year 2000.

The total labor compensation associated with the 108,500 lost jobs is $6.7

billion. Labor compensation includes total payroll costs (wages and salaries,

fringe benefits, and payroll taxes). This amount represents 2.7% of the

estimated total employee compensation in New York City in 2000.

This report presents estimates of the total economic and employment effect of the

September 11 event and its aftermath. These estimates are based on the best

available information regarding the direct impacts, supplemented by FPI's economic

analyses. The employment and output estimates are considered to be those that

would occur in the first month following the event. The anticipated direct employment

effects were used to estimate total economic and employment effects using the

IMPLAN input-output model for New York (see page 5). This job loss estimate

represents jobs lost to the New York City economy, not necessarily increased

unemployment of that magnitude. Some jobs relocated outside of the city.