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Resuming Operations after a Catastrophe

What were the most daunting challenges confronting New Orleans business owners in the wake of Hurricane Katrina?

(originally published by Booz & Company)

Business Return in New Orleans: Decision Making Amid Post-Katrina Uncertainty

Nina S.N. Lam et al.

PLoS One, vol. 4, no. 8

Date Published: 
August 2009

The months following Hurricane Katrina offered researchers the rare chance to examine how businesses return to a community after a disaster. The authors of this paper conducted repeated telephone interviews and street surveys with business owners in New Orleans over a two-year period after the hurricane (August 2005), in an effort to identify the factors that influenced owners to either reopen or shutter their businesses. By October 2007, the researchers found a reopening rate of 65 percent; scientific, technical, and professional services–oriented businesses (as classified by the North American Industry Classification System) were the first to return. About 59 percent of businesses adopted a “wait and see” attitude in the four months following Katrina. During that same period, New Orleans proprietors cited adequate levee construction as their primary concern, whereas two years later, they cited protection from crime as their largest problem. Clear emergency and recovery plans make business owners feel more confident about the decision to reopen.

Bottom Line:
A study of New Orleans businesses in the months following Hurricane Katrina found that concerns over infrastructure and crime helped determine whether they reopened.

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