Business Vulnerability Index

Introduction

The Business Vulnerability section presents information on the number of businesses in an area that could be more vulnerable to disasters because of the nature of the business.

To calculate the BVI, we isolated businesses by NAICS code from the Census’ most recent County Business Patterns based on their vulnerability to a disaster. Businesses that were identified to be especially vulnerable to a disaster are those which are dependent on supply chains, have a high reliance on public utilities like water and electricity, or have a large infrastructure footprint and low infrastructure mobility. These qualities were identified to be contributing factors to high vulnerability in a paper that describes surveys to local businesses around New Orleans (AECOM, 2016), a city with considerable experience with natural disasters.

We calculated business vulnerability as the percentage of businesses in a county that does not fall into the identified list of NAICS codes that represent vulnerable businesses; this calculation is normalized in the same way as indices calculated in Cutter (2010) to yield values between 0 and 1.

Who does this Information Help?

  1. An EDA Officer looking to review the disaster profile of a county/an applicant.
  2. A Local economic developer reviewing sections of their community that needs investment support.

Computation/Data Source

BVI was developed in coordination with EDA and employs custom resilience indices across dimensions that EDA has identified to be important to the Economic Recovery Support Function (ERSF). The ERSF is typically activated in the wake of a disaster. For example, the BVI accounts for the concentration of businesses in an area that could be more vulnerable to hazards and disasters because of the nature of the business, i.e., what products or services it produces, the extent of its reliance on certain resources, etc.