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The tremendous effects of a famous hurricane caused great changes in the peaceful life of the inhabitants of New Orleans. In August 2005 the hurricane Katrina caused the breach of the flood protection system. Seven years later, the city is still under the effect of the storm in many ways. The storm was the reason of the most horrible engineering disaster in the history of USA. Because of the flooding, the oil refining was stopped in New Orleans, increasing prices in the country. The region of New Orleans was struck by three crises: the hurricane, the Great Recession and the deepwater horizon oil spill. Despite the difficult conditions, the city is on the way to transformation and recovery.

The disaster had major implications on segments of economy, population and politics. According to the institute of the Southern studies the number of US deaths related to the hurricane is about 1.500 people, 771 of whom are from New Orleans. The number of deaths related only to flooding is 518. Estimated economic damage in New Orleans area, caused by the disaster, is 14 billion dollars. Since the hurricane 26% of the city’s population was lost. According to the research 27% of general population is now in poverty, while 42% of city’s children are currently in poverty. New Orleans is second among the U.S. cities with the highest rates of homeless. At the same time New Orleans is on the first place of the fastest growing large cities in the U.S.A.

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According to Greater New Orleans Community Data Centre the regional economy has begun to diversify with growth in knowledge-based industries such as higher education, legal services, and insurance agencies (Greater New Orleans Community Data Centre, 2011, p. 2). Big steps were obtained by relief agencies and federal funding. To restore and re-plan the city Frederic Schwartz was chosen by the citizens. According to the U.S. Government Accountability Office (2010), “The federal government used a variety of direct and indirect funding programs to support the city. These programs included well-established grants such as the Department of Health and Human Services' (HHS) Temporary Assistance for Needy Families and its Social Services Block Grant, as well as the Department of Housing and Urban Development's (HUD) Community Development Block Grant“(U.S. Government Accountability Office, 2010). In the period of 2000 to 2004, the growth of average wages in New Orleans metro showed 7%. After the hurricane Katrina wages showed the growth of 14%. Generally, the growth of wages was in such businesses as bars and restaurants, car dealing and reconstruction-related industries. Before the disaster 218 entrepreneurs started their businesses, whiled after the 2008 the average amount of individuals was 333.

Despite the positive development and economic growth, yet several economic, social and environmental trends remain troubling. Over the last thirty years the gains in knowledge industries have not made up for the losses in tourism, oil and gas, shipping and logistics (Greater New Orleans Community Data Centre, 2011, p. 3). Although the share of adults with college education has grown with every ten years since 1980, locally only 54% of adults have some college education compared to 57% nationally (Greater New Orleans Community Data Centre, 2011, p. 3). The trend of suburbanization of poverty accelerated after the Katrina, leaving 56% of impoverished population. The costs spent on housing are much higher compared with the nation results. More than 35% of household income is spend on rent. Although crime rates after the Katarina have fallen, still it is 80% higher than the national ones.

Great progress in New Orleans in the fields of education, health care, housing, criminal justice raised standard of life and build safer community for everyone. The region still needs strong policy, which will develop economics and workforce. The task of lifting up of economics remains essential, while the most important issue is to reduce possible flood risks. As well as sea levels continue to rise, lowering the risks of possible flooding is of crucial importance.

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