November 14, 2003—A study measuring the economic impact of the August 2003 blackout is finding that the event will have far-reaching, long-term implications for businesses and organizations in the affected region. Preliminary results, released this week, indicate that the event will affect growth and relocation plans for a significant number of businesses; and that it will cause many more to ramp up their investments in disaster preparedness and alternate energy systems in the future. The study is a joint undertaking of Mirifex, a business and technology consulting firm, The Center for Regional Economic Issues at Case Western Reserve University’s Weatherhead School of Management and CrainTech.
Preliminary findings of the study include responses of 129 executive-level managers of businesses and organizations in Ohio, New York, Pennsylvania, Michigan, Wisconsin, and Southern Canada.
Among the key findings to date:
- 11% of firms say the blackout will affect their decision-making with regards to either growth or relocation.
- As a consequence of the blackout, over one third of businesses surveyed (38%) said they’d be somewhat or very likely to invest in alternate energy systems.
- Over one-third of firms surveyed (34%) have no risk management or disaster recovery plans in place.
- Nearly half (46%) of the businesses surveyed will invest more in risk management, business continuance and/or disaster recovery in the future.
- More than a third of the businesses surveyed (35%) felt it was somewhat or very likely that the region’s image would suffer as a result of the blackout.
- More than half the businesses surveyed say the top threat of future interruption is either Cyber-Crime (26%) or a Utility Outage (26%), outdistancing other concerns more than 2:1.
- Two-thirds of the businesses surveyed (66%) lost at least a full business day due to the blackout.
- A quarter of the businesses surveyed (24%) lost more than $50,000 per hour of downtime-meaning at least $400,000 for an 8-hour day. And 4% of businesses lost more than $1 million for each hour of downtime.
- Nearly half of the businesses surveyed (46%) said lost employee productivity was the largest contributor to losses suffered due to the blackout.
- Production/Manufacturing and Customer Sales/Service were the areas of business hardest hit by the blackout.
An executive summary of study findings will be made available to businesses and organizations through Mirifex. For a copy, send an email including your name, organization, address and email address to Mirifex.
