‘It is devastating’: unprecedented floods in US strain small businesses

 As the climate crisis causes heavier and more frequent floods across the US the costs associated with flooding – among them insurance, infrastructure upgrades, flood prevention measures, damages, and lost revenue – are straining businesses like Root Hill.

According to the US Chamber of Commerce, one in four (27%) of small businesses say they are one disaster away from shutting down.

“In the past two years, businesses experienced disaster damages and closures not only in higher-risk states like Florida and California but also in Vermont, Iowa, Minnesota, Kentucky, Colorado – the list goes on,” said Benjamin Collier, a professor at Temple University’s business school. “These events have been devastating.”

That carries major economic implications. Small businesses employ nearly half of US workers and represent 43.5% of America’s GDP.

In New York, the September flooding event led to $100m in total economic losses across the New York metro region, according to a report by the city comptroller.

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“Small businesses are often less likely to have other resources that are available to larger clients,” said Collier. “They are dealing with cashflow constraints, which means they’re not buying the same insurance or the same amount of insurance.”

According to the Federal Emergency Management Agency (Fema), as of April, only a fraction of the country’s small businesses – about 120,000 – carried insurance through Fema’s National Flood Insurance Program (NFIP), the country’s largest insurance provider for small businesses.

Experts, advocates and business owners said local governments can help small businesses by investing in infrastructure upgrades for things like sewage, drainage and water catchment systems; funding flood prevention and resilience programs; and requiring greater transparency on flood history.

‘It is devastating’: unprecedented floods in US strain small businesses | US news | The Guardian