Disasters as Mega-Disruptions to Construction Supply Chains: Fid-Bau Portal

Disasters as Mega-Disruptions to Construction Supply Chains

Arneson, Erin

Natural hazard disaster events such as hurricanes are increasing in frequency and intensity across US coastal states and territories, serving as mega-disruptions of residential construction industry labor and material supply chains. Hurricanes create sudden competition for the limited post-disaster residential construction resources available within the construction supply chain, affecting labor wages and material prices. However, few quantitative studies have examined how disaster mega-disruptions affect post-disaster construction supply chains. Utilizing supply chain management theory and data from the 2017–2018 US hurricane season, this study addresses the question: How do disaster mega-disruptions influence post-disaster residential construction labor and material supply chains? Specifically, this study assesses how Hurricanes Harvey, Maria, Irma, and Florence collectively served as a supply chain mega-disruption by causing billions in residential housing damages across Texas, Florida, North Carolina, and Puerto Rico from 2017 to 2018. First, data from the Federal Emergency Management Agency (FEMA) were used to measure housing damages caused by the mega-disruption in the four hurricane affected states and territories. Second, increased post-disaster demand for construction was calculated by comparing disaster damages against the volume of housing typically built by the residential construction industry according to the US Census. Finally, data from the Bureau of Labor Statistics (BLS) were utilized to measure how hurricane housing damages affected residential contractor labor wages and building material prices. Results indicate that the 2017–2018 hurricanes generated pricing surges, creating a mega-disruption to both residential construction labor and material supply chains.