Video: Wildfires could disrupt air travel

updated 10/25/2007 3:47:47 PM ET 2007-10-25T19:47:47

Along with damage to property, infrastructure and crops, the wildfires in California have hurt tourism.

Popular tourist destinations, such as SeaWorld in San Diego and the Wild Animal Park in nearby Escondido, were forced to shut down.

Along with those temporary disruptions, the impact of nationally televised images and media accounts of Southern California ablaze will likely dampen tourism for some time, economists said.

"Incidents like this will drive away a certain number of people," said Kevin Klowden, managing economist for the Milken Institute.

Still, rebuilding homes and businesses with an influx of insurance and government aid should stimulate the lagging construction industry, which has lost 28,600 jobs in the past year amid the housing slump.

The pace of that rebuilding could be slow compared to the region's recovery after the 2003 firestorms that destroyed more then 3,600 homes and caused insured losses surpassing $2 billion.

"Back then, the homebuilding market was quite strong," said Jack Kyser, chief economist of the Los Angeles Economic Development Corp. "This time around, home building is slumping."

Jerry Nickelsburg, an economist and co-author of the quarterly University of California, Los Angeles, Anderson Forecast, said calculating the losses will be an ongoing process.

Slideshow: California wildfires "We are going to enter into a period of rebuilding in all of these areas that have been destroyed, and I don't think we really know what kind of value to put on that," Nickelsburg said.

But the economic pain might be short-lived, he said.

"All in all, the fires occurred in more remote, residential areas," Nickelsburg said. "It will have very little effect on the medium and long-term economic growth and economic health of the region."

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