With estimated total GDP losses of over $700 billion between 2022 and 2050, our Aquanomics model projects that the states making up the Northeastern region of the US face a significant economic hit. The region also could face direct losses of $434 billion in the years leading up to 2050, with well over half of that figure ($288 billion) attributed to flooding.
In percentage terms, it is the region’s FMCG and retail and agriculture sectors that could be particularly affected, with projected annual output losses of nearly 3%. However, the Northeastern US’s huge financial sector (incorporating the financial hubs of New York City and Delaware) is predicted to be relatively unscathed with projected output losses of just 0.1%.
States included: New York, Pennsylvania, Maryland, Delaware and New Jersey
Northeastern US data dashboard
- FMCG & retail
- Manufacturing & distribution
- Energy & utilities
- Banking & insurance
What events will cause the biggest economic impact?
Data showing direct losses by weather event type between 2022 - 2050
Water risk in the Northeastern US
The Northeastern region is characterised by a fairly diverse climate, with bitterly cold winters often bringing extreme weather in the form of ice storms and snowstorms (including the infamous ‘nor’easters’ – massive storms blowing from the northeast) and semi-humid summers, especially to the south. The region suffers from ageing infrastructure, with much of it having been constructed over a century ago. Many older cities’ sewer and stormwater systems simply cannot handle the volume of water produced by heavy storms, and many areas have toxic lead pipes supplying drinking water, which need to be replaced.
However, the exposure and vulnerability of the population are relatively low due to effective and widespread early warning systems. While Hurricane Ida caused a huge amount of economic disaster losses in the Northeastern US (over $18 billion) due to flash flooding and tornados, the number of fatalities was relatively low. Emergency situations may lead to the temporary displacement or evacuation of large numbers of people; however, most are able to return home and rebuild due to high levels of insurance cover and federal support, as was notably the case following Hurricane Sandy in 2011.
Building future water resilience
The Northeastern US is a water-rich environment with advanced systems to manage flood risk and potential storm damage. However, water quality remains an issue in some areas due to ageing infrastructure, which will require significant investment to rectify over the coming decades.
The Environmental Protection Agency (EPA) has estimated that there are 6-10 million lead service lines across the country, many of which are in the Northeastern region. When a drinking water supply has high acidity or low mineral content, this can result in corrosion meaning lead leaking into local water supplies.