Sorry: Tragic Events Help the Economy
BOSTON (MainStreet) -- With unemployment so stubborn, perhaps the best news would be some bad news?
With no intention of minimizing or dismissing personal anguish, we might point out that there is undeniably an economy of the tragic. Tragedy and strife -- from war to Mother Nature's fury -- effectively rob from Peter to pay Paul. Where one person loses a house to floodwaters, another finds work as a contractor.
|Bad news, disasterous weather and war all play a part in adding jobs.|
A counterargument to the insensitive consideration that disaster might give an economic jolt or put people back to work is the so-called "broken window" theory offered by political economist Frederic Bastiat. Simply put, it can explain post-crisis gains as really just shuffling money around. The money that, for example, a contractor earns for repairing the proverbial broken window is ultimately coming at the expense of other ways the owner would have spent it. After a flood or hurricane, tradesmen may find work, but the local restaurant, auto dealer or retail store all lose out.
Nevertheless, there will always be some who find work when things go bad.The ultimate worry for many is death itself. According to the National Funeral Directors Association, U.S. funeral homes employed 102,877 workers in 2007 (the last time the five-year U.S. Census Bureau's Economic Census was conducted). Funeral home and crematorium revenue that year was $12 billion, up from $11.1 billion in 2002. The average cost of a funeral is just shy of $7,000. The association estimates that there are nearly 26,000 funeral directors and more than 8,000 embalmers employed in the U.S. For that particular "sector," job growth is all but assured in the years to come, thanks to the aging population of baby boomers. The U.S. Census Bureau projects the annual number of deaths in the United States will rise to 3 million in 2024 and 4 million in 2043 from about 2.6 million now. Sickness similarly keeps many earning their paychecks. According to the Department of Commerce, there are roughly 6,500 hospitals in the U.S. and they employ more than 5.5 million people. The annual payroll is north of $265 billion.
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