How the Baltimore Bridge Collapse Impacts the Economy

Source: US Chamber of Commerce

The collapse of the Francis Scott Key Bridge in Baltimore has created enormous repercussions throughout the region and the country, including the closure of one of the nation’s most important seaports, the loss of thousands of jobs, and the loss of mobility for millions of people.

The Key Bridge was a major thoroughfare through Baltimore, helping to keep people, businesses, and communities connected. The bridge collapsed on March 26, after being struck by the containership MV Dali. This led to a halt of operations at the Port of Baltimore—one of the busiest ports in the nation, responsible for over 15,000 direct jobs and 140,000 indirect jobs in the region, and tens of billions of dollars of cargo each year.

What is the impact?

First and foremost, this incident resulted in six bridge maintenance workers losing their lives, tragically impacting their families and communities. But for Baltimore and the region “this is going to be difficult,” Marty Durbin, Chamber Senior Vice President for Policy, told Fox 5 in Washington, D.C., in reference to likely prolonged impact this tragedy will have on the local economy. Businesses involved with moving goods through the port will be negatively impacted.

The Port of Baltimore plays an important role in the local, regional, and national economy. It is the largest importer and exporter of vehicles in the U.S., with 800,000 vehicles moved through the port in 2023. It is also the second largest exporter of coal, and a significant amount of agricultural equipment goes through the port.

The effects of the port’s inaccessibility will be felt throughout the country. “Shippers are looking to find different destinations for their shipments. If now they have to divert to ports along the eastern seaboard or on the West Coast, you may see delays or increases in costs just because of the increased trucking costs,” Durbin added. “We can expect to see some cost effects,” but the long-term impacts are yet to be determined.

Could there be supply chain disruptions?

Businesses at the local and national level are collaborating with government authorities and other stakeholders to minimize the impact on supply chains. Strategies include diverting cargo to alternative ports with excess capacity, engaging with customers on a one-on-one basis to ensure cargo reaches its final destination, and working collaboratively to minimize the impact on workers in the area.

What about the fallen Key Bridge?

Clean up efforts have just begun. The Federal Highway Administration approved $60 million in “quick release” emergency funds, Politico reported. Heavy cranes have moved to the area, and workers have begun removing the bridge. The Coast Guard has established a temporary alternate channel on the northeast side of the main channel for commercially essential vessels.

That will help with recovery efforts, but there will still be major traffic disruptions around the Baltimore area until the bridge is rebuilt.

The Biden Administration has pledged to fund bridge rebuilding, but that will likely require approval from Congress. It will also entail many federal agencies working together. “It’s going to involve more than one agency, so it’s going to take a lot of coordination to get it done quickly and really focus everybody’s minds on what it is they want to do,” Chad Whiteman, vice president of environment and regulatory affairs at the Chamber’ Commerce’s Global Energy Institute, told Bloomberg Law.

Is there help for businesses affected by the disaster?

We are working closely with the Maryland State Chamber of Commerce, the Greater Baltimore Chamber of Commerce, as well as other industry and government partners to identify the needs of businesses in the region and to provide support.

• The Maryland Chamber of Commerce has an information hub – Building Bridges to Recovery – to support businesses effected by the bridge collapse.
• The U.S. Chamber Foundation’s Disaster Help Desk provides one-on-one expert assistance to small business owners after a disaster strikes. Contact them at 1-888-MY-BIZ-HELP.
• Small businesses can apply for disaster relief from the Small Business Administration.

About the author - Sean Hackbarth
Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.