It's anything but good tidings and cheer: 33,000 members of New York City's Transportation Workers Union began a strike Tuesday, bringing the Big Apple's subways and buses to a halt. The city comptroller estimates the economic loss at $400 million for the first day alone, and an average of $300 million for every day the strike continues.
Faced with these staggering figures, it's only natural to fear that retailers also could be hurt by the strike. Indeed, some analysts are already predicting that Federated Department Stores
There is no doubt that the strike is disruptive. How else could one characterize an event that leaves 7 million daily riders without a lift? But an important point is that a lot of the economic loss from the shutdown comes from lost work time as meetings are canceled and people take the day off to avoid the commute.
These commuters don't just disappear, though. They are still out there, and most of them have money to spend and gift lists. And because the major retailers have locations in the suburbs as well as online sites with express shipping, it seems likely that most of the people affected by the strike will find a way to get their gifts. In fact, people taking time off from work could actually spend more time shopping, potentially leading to higher retail sales.
Admittedly, big retailers are more likely to be hurt the longer the strike drags on. A lingering strike would hit many of the city's services workers, as reduced tourist and other traffic in the city would surely lead to cuts in hours and, perhaps, jobs. For now, though, big retailers don't need to panic.
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Fool contributor Brian Gorman is a freelance writer in Chicago. He does not own shares of any companies mentioned in this article.
