Hurricanes Helene and Milton wrought destruction as they lashed across the southeastern United States in late September and early October. Lives were lost. Properties were ruined.
Amid this devastation, it’s worth noting the considerable toll that storms like these can take on the small businesses that happen to lay in their paths. Small businesses can help knit together the fabric of a community, and many people depend directly on such enterprises for their livelihoods.
Potential knock-on effects from damage to small businesses could also create challenges that extend to the broader economy. Micro-, small, and medium-size enterprises (MSMEs)—defined as enterprises with fewer than 500 employees—collectively play a major role in powering the US economic engine. They create millions of jobs, including roughly 87 percent of jobs in construction, 64 percent in professional services, and 62 percent in accommodation and food services. What’s more, they foster business dynamism. Of the publicly traded US companies valued at $10 billion or more in 2023, 17 percent were MSME s at some point since 2000. Similarly, some of the large companies of tomorrow will surely emerge from the small firms of today.
Transparency can help guide more efficient responses both during crises and in their long-term aftermath. And helping small businesses regain their footing during a challenging moment can have positive effects that extend beyond the fate of one firm. Drawing on data sets created for a recent report on small enterprises from the McKinsey Global Institute, the following is an analysis of the potential impacts of Hurricanes Helene and Milton on MSMEs in two storm-afflicted US states. It is difficult to pinpoint the specific small businesses that have been harmed by the hurricanes, but this article compiles a comprehensive set of statistics relating to the universe of MSMEs in the counties named in the Federal Emergency Management Agency (FEMA) disaster declaration for individual assistance as of October 28, 2024 (while noting that counties could be added or removed at a later date as more information emerges).
Nearly 60 percent of Florida’s small businesses were in Hurricane Milton’s path
After making landfall in Florida on October 9, 2024, Hurricane Milton swept a path across the state, affecting 34 counties, many of which had already been exposed to Hurricane Helene only a few days earlier. The counties Milton affected are collectively home to almost 60 percent of the state’s MSMEs. Those 1.9 million small businesses employ about 4 million people and generate more than half a trillion dollars in revenue. Of these 34 counties, the 25 that endured winds of greater than 58 miles per hour are home to 35 percent of the state’s MSMEs.
Six Florida counties—Hillsborough, Pinellas, Sarasota, Manatee, DeSoto, and Hardee—were hardest hit by the storm, experiencing hurricane-force winds of more than 74 miles per hour. These counties are home to almost half a million small businesses, employing nearly one million people and generating about $130 billion in revenues.
About two-thirds of the small Florida businesses in Milton’s path employ fewer than 20 workers
About 2.6 million employees of MSMEs based in counties affected by Hurricane Milton work for enterprises that employ one to 19 people. These businesses account for roughly 65 percent of the total employees and 48 percent of the total economic output of the Florida MSMEs in the hurricane’s path.
Self-employed workers and microenterprises (defined in this exhibit as nonemployer businesses and employer businesses with fewer than 20 employees) can be particularly vulnerable to exogenous disruptions. Florida counties in Milton’s path are home to a disproportionate share of self-employed workers (24 percent of all employees in those counties—including the employees who work for larger companies—as compared with 18 percent across the United States).
Roughly 1.4 million small-business employees across Florida’s healthcare, construction, and professional-services sectors could feel the effects of Milton
Milton’s path cut relatively evenly across a wide range of Florida’s small-business sectors, affecting 50 to 60 percent of small businesses in most sectors. The healthcare sector leads the way in workforce numbers, with about 476,000 people employed by MSMEs in hurricane-affected counties. The construction and professional-services sectors are not far behind. In-person sectors, including retail—which has approximately 333,000 workers employed by MSMEs in Milton’s path—could potentially feel more pronounced effects related to the storm. The personal-services and real estate sectors, in which 80 percent of workers fall into the more vulnerable self-employed and microenterprise segments, could face substantial challenges.
Roughly 45 percent of North Carolina’s small businesses are in counties hit by Hurricane Helene
Of North Carolina’s roughly 1.1 million total MSMEs, about 471,000 are based in the 39 counties that FEMA designated for individual disaster assistance as of October 21, 2024. These small businesses in Helene’s path collectively employ about 1.1 million people and produce about $168 billion in revenues. Affected counties include Mecklenburg and Buncombe, home to the important population centers in, respectively, Charlotte and Asheville.
Nearly 60 percent of North Carolina small businesses affected by Helene have fewer than 20 employees
In the North Carolina counties hit by Hurricane Helene, enterprises with fewer than 20 employees produce $72 billion of economic output. That’s about 42 percent of the total economic output of those counties’ MSMEs. The affected counties host a large share of self-employed workers (18 percent of all employees in those counties, including employees who work for larger companies) and microenterprises (14 percent of total county employment).
Hurricane Helene’s effects touched a wide range of North Carolina’s business sectors
Helene’s sector-level impacts in North Carolina were relatively evenly distributed, affecting approximately 40 to 50 percent of the state’s MSME firms, employees, and revenues across most sectors. In the affected counties, healthcare MSMEs, with a total of roughly 132,000 employees, topped the list in worker populations, followed by construction MSMEs and accommodation and food services MSMEs. MSMEs in the wholesale trade, with their roughly $34 billion in collective revenues, had the most sector-level economic output put at risk. The professional-services and construction sectors feature a large proportion of workers—about 70 percent—in the more vulnerable self-employed and microenterprise segments.
Providing relief to MSMEs that have been affected by natural disasters could help restore jobs, heal communities, and mitigate ripple effects on the broader economy. Government-level aid can bolster recovery efforts, as can time and money donated by generous individuals. But larger companies that have been spared the adverse effects of a natural disaster have also played roles in helping MSMEs regain their footing (see sidebar, “Companies can help other companies in times of duress”).
Big companies that want to help their smaller counterparts recover might consider how to bring specific strengths to the cause. Different sectors have different needs. Providing financing, expertise, facilities, and resources can all be ways to help small enterprises endure challenging moments and thrive again.
