Hurricane strikes sow doubt among Florida consumers in October

Business concept of family economy and expenses. Dollar bills and family sign

Following a Summer of upbeat news and rising consumer sentiment in Florida, University of Florida (UF) researchers say October’s economic analysis shows a drop in consumer confidence for the first time in five months.

Overall sentiment among Florida consumers fell from 78.3 in September to 77.4 this month. UF researchers blame the drop on major hurricanes that hit the state in the Fall. Hurricane Helene pounded Florida’s Big Bend area on Sept. 26. Less than two weeks later, Hurricane Milton crashed into Florida’s west coast, leaving a trail of massive destruction in its wake.

Both storms had major economic impacts, as new unemployment filings spiked in the weeks after both storms and there were huge numbers of insurance claims filed in the state, prompting an estimated damage tab of more than $4 billion and counting.

“The decline in consumer confidence is not surprising, as this month’s reading reflects the impacts of Hurricanes Helene and Milton,” said Hector Sandoval, who oversees the consumer sentiment survey and is Director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research. “These back-to-back storms caused significant damage to homes, business, and infrastructure, resulting in a loss of economic activity.”

The results of October’s survey offset a string of strong consumer sentiment reports that were improving for four straight months through September. October’s report also cuts against the national picture that saw consumer sentiment tick up in October. Nationally, consumer sentiment has increased for three straight months.

The October consumer sentiment survey showed views on personal finances fell by 1.2 points compared to a year ago, to 57.3.

Another major indicator is if consumers feel that now is the right time to buy a major household appliance, such as a refrigerator. That metric remained unchanged, holding at 60.9 points.

Even the economic outlook for a year from now took a hit, according to the study, falling from 93.7 in September to 90.8 in October.

But Sandoval pointed out that Floridians are crawling out of the major trauma of two powerful hurricanes. The state has rarely had to deal with such tragedies in repeated succession on such a large scale.

“These shifts in confidence and labor market dynamics are not expected to have a lasting impact on the state’s economic prospects, as past experiences indicate. After Hurricane Ian in 2022 — one of the costliest tropical cyclones — both jobless claims and consumer confidence rebounded quickly,” Sandoval said.

“Typically, the effects of hurricanes on consumer sentiment are short-lived, so we expect the decline in consumer confidence to be temporary, even considering the cumulative impact of two storms. By November, the outcome of the presidential election is likely to play a major role in shaping consumer sentiment.”

The UF consumer sentiment survey for October was conducted between Sept. 1 through Oct. 24 as researchers contacted 645 Florida residents through mobile phone and online questionnaires.