Boston Economy Will Escape Big Freeze Of Historic Snowstorms
Nearly 9 feet of snow has fallen on Boston this winter — most of it in February — closing workplaces for days and leaving commuters stranded.
"I've been working from home for the past couple of days because I can't get to work," says Christopher Clickner, an insurance agent. "It's been taking me an hour-and-a-half sitting here to try to catch a bus, and it just hasn't worked at all."
Much of the snow is still piled up, disrupting traffic and commerce, but the record storms are not expected to shrink the economy like the polar vortex did last year.
Bostonians might want to blame their weather woes on Patrick Renna, the CEO of a New England burrito chain called Boloco. Back in January, he was forecasting strong growth at company board meeting.
"I remember the chairman asking me 'so Patrick, what's the biggest risk?' And I said 'weather ... but thankfully, we've been good so far,'" Renna says before laughing. "Then two weeks later started the 102-inch snowfall that we've received since then. So maybe I jinxed it."
Boloco's sales fell 20 percent last month. The company primarily serves people working in Boston office buildings, and half of Renna's stores were closed for days.
"In my 20 years of business, it was the worst restaurant month that I've ever been involved with," he says.
And unlike someone who waits until a snowstorm passes to buy a new fridge or new car they were going to buy anyway, those burrito sales are gone for good.
"You're not going to sell two lunches tomorrow to offset the lunch that you didn't sell today," says Michael Goodman, an economist at the University of Massachusetts Dartmouth.
But while the office employees aren't coming in to work and grabbing a burrito for lunch, that doesn't mean their businesses are closed, too.
"I worked from my desk in my living room," says Amanda Schreyer, a lawyer for a snowbound downtown firm. "I have a laptop; I can connect remotely to my work system. It was really business as usual."
At her firm, Prince Lobel Tye, managing partner Craig Tateronis says billable hours were down 10 percent in February, but that he's not too stressed about it.
"We certainly understand why we have the result we do in February," he says. "But we also expect that we will get the productivity back." Tateronis says his lawyers and paralegals can make it up.
For many businesses, the slowdown was temporary, not permanent. That's the case for many companies affected by the snowstorms, says Doug Handler. He's the chief U.S. economist at the research firm IHS.
"We're lucky that Boston is, for the most part, a knowledge-intensive city," he says. "And actually the permanent economic loss because of that really isn't that significant."
By knowledge-intensive he means financial services firms, universities and software companies — workplaces that don't produce physical products in a fixed location. Even when Handler's team came up with its estimate of the permanent economic loss from the snowstorm, they did it from the comfort of their homes.
"Depends on the time of day, but we start with hot chocolate for sure," he says.
The estimated permanent loss to the Massachusetts economy is more than $1 billion. It's not chump change. But annualized, that's just a percentage point off the regional output. And it's not a bad outcome, considering how much snow still covers the region.
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