By Andy Metzger
STATE HOUSE NEWS SERVICE
STATE HOUSE — The snow and cold that has pounded transportation systems across Massachusetts and kept people huddled at home away from shops and restaurants has also put a dent in industrial and agricultural operations.
“The primary issues are employees have not been able to get to work in many cases,” said Christopher Geehern, of the Associated Industries of Massachusetts, continuing that distribution has also been a problem and snow removal efforts have consumed the attention of industrial businesses.
Geehern said he surveyed members Tuesday, and heard back from 24 companies, including one who wrote, “Production runs being cancelled as employees could not make it into work. Trucks not showing up to pick up or deliver our products.”
At the Mystic Generating Station, an eight-unit oil and natural gas power station on the Mystic River across from Charlestown, the plant put out-of-town workers up in a hotel and provided food, said Kevin Thornton, a spokesman for Exelon, the plant’s owner.
“You have to keep these plants running,” said Thornton, who said the plant lowered output at times to avoid the risk of snow and ice in the river tripping the plant offline, and workers constantly shoveled the flat roofs on the facility. The plant has a total of about 100 workers, has the capacity to power roughly two million homes, and the biggest costs have been snow removal, Thornton told the News Service.
At insurance broker Marsh & McLennan, workers are seeing claims come in for ice dams causing leaking and roof collapses, and Jerry Alderman, president of property and casualty in New England, expects an “uptick” in auto claims.
“Everybody’s on standby for some pretty hefty losses,” Alderman told the News Service. He said insurers will likely take actions to “trigger” reinsurance – which is essentially insurance for insurers. Alderman said brokers help homeowners at risk of a roof collapse, connecting them with contractors to remove the snow. The outfits removing the snow are “stretched pretty thin,” he said.
A study by IHS Global Insight estimated that a one-day snow-related shutdown in Massachusetts would cost the Massachusetts economy a total of $265 million, though Michael Goodman, an economist at UMass Dartmouth who shared the research cautioned against ” any false precision” of the economic cost of the recent snow.
Starting in late January, Massachusetts has been battered by two blizzards and two other major snowstorms that have jammed up roads, buried parking spots and caused widespread service outages on the MBTA, including complete shutdowns.
Goodman said the recent weather could account for several billion dollars of losses in the state’s roughly $460 to $470 billion economy, potentially slowing economic growth in the first quarter even as other economic markers are promising. Goodman said especially cold weather in the first quarter of last year “threw us off our game” and the scale of the recent snow’s effect on the economy won’t be known until after the quarter ends.
Impassable streets and cancelled transit service has the greatest effect on hourly wage workers and small business owners, while others experience a loss in productivity and “lost personal time” spent traveling to work or out shoveling, Goodman said.
In an effort to boost retail sales and restaurant receipts by extending a big-spending holiday, Gov. Charlie Baker declared this week Valentine’s Week. Goodman said that was a “good idea.”
State Auditor Suzanne Bump, who was formerly secretary of Labor and Workforce Development, said the economic impact of the snow will last longer than the piles of snow crowding shoulders and sidewalks.
“This winter weather has been economically devastating,” Bump told the News Service. She said, “It’s going to have, I think, an impact that will last far beyond the winter season.”
Meanwhile snow removal contractors are experiencing more demand for their services, and auto sellers and retailers will likely make up the sales lost to snow after the thaw.
“There are winners and losers,” Goodman said.
Farmers face a few short-term risks from the massive amounts of snow, said Richard Bonanno, president of the Massachusetts Farm Bureau Federation. He said the long-term effect is likely beneficial as the snow pack will melt, providing moist soil for the beginning of the growing season and filling reservoirs.
Farmers with heated greenhouses are burning oil to keep the snow from building up on top of them and farmers with animals have to be vigilant in protecting them against the cold, Bonanno said. He said one of the requirements for dairy products to be labeled organic is the cows spend a period of time outside every day.
“I would say animals are at the top of the list in terms of concerns,” Bonanno said.
Bonanno said some unheated greenhouses “have come down,” and other farm structures, such as barns are at risk. This is the time of year when fruit farmers usually prune, and that work will have to be pushed farther into the spring when there is also other work to be done, Bonanno said. He said pushing back pruning would likely cost farmers who will have to bring on extra labor, but will not put crops at risk.
The cold weather has alleviated a concern some farmers shared earlier in the winter that plants would bud early before the spring began.
“There was some concern about a lot of the crops not going into dormancy for the winter,” Bonanno said.
Scallopers in New Bedford that haven’t yet used up their allotted days of fishing will be feeling pressure to head out before the scallop fishing year starts again March 1 and the allotted days are re-set, said John Quinn, a former state lawmaker and a member of the New England Fisheries Management Council.
“You force them out in the bad weather,” said Quinn, the director of Public Interest Law Programs at the University of Massachusetts School of Law. He said, “It certainly is more challenging in the rough seas and icy weather.”
The groundfish fishing year starts again May 1, so the boats that trawl for cod and flounder are “not under the gun” now to reach their quotas before the year ends, Quinn said.
Goodman said despite a start hampered by the “polar vortex,” 2014 was a “solid year.” He said 2015’s snowy and blustery start has likely hurt incomes, but is unlikely to cause a significant increase in unemployment.
Geehern said all 24 respondents to his email survey reported negative effects from the snow, including lost days when they could have been manufacturing. He shared responses with the News Service without revealing the responding companies’ identities.
“We are a service business and without the MBTA employees could not get to work. Also, with all the snow, potential customers focused only on dealing with the snow, not bringing on new vendors,” one respondent wrote. “The first quarter numbers will tell the story.”