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August 2006

The effect of Hurricane Katrina on employment and unemployment

Sharon P. Brown, Sandra L. Mason, Richard B. Tiller

Hurricane Katrina had a strong effect on employment in Louisiana and Mississippi, depressing levels by about 232,000 and 58,000, respectively, in those two States through June 2006. The initial effect on unemployment, though also strong, was temporary. This article describes the process of determining appropriate actions to take in the areas affected by the hurricane, the implementation of those actions to date, and the key labor market trends as measured by the Local Area Unemployment Statistics (LAUS) program. In gauging the effect of Hurricane Katrina, the LAUS program abandoned its longstanding policy of not intervening in model estimation during the current year and intervened in real time.

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