When Americans hear about an infectious disease outbreak, they often think first about emergency rooms, quarantines and public health agencies. But from an economist’s perspective, those elements are only the first layer of a much larger story.

Recent concurrent outbreaks in the US — including a major outbreak of cyclosporiasis, an intestine illness caused by a foodborne parasite called Cyclospora, and a community cluster of Legionnaires’ disease, a pneumonia-causing bacteria, in New York City — demonstrate that infectious disease events are not merely public health emergencies. They are also economic shocks that expose vulnerabilities across supply chains and infrastructure networks.

The critical question for policymakers is therefore not only about the cost of an outbreak. Instead, they should ask: How resilient are our interconnected systems when multiple disruptions occur simultaneously?

Simultaneous outbreaks strain institutional capacity

A single outbreak can challenge even well-prepared public health systems. Multiple simultaneous outbreaks, however, create a far more complex resilience challenge. Modern outbreaks spread through networks — not only biological networks, but also supply chains, infrastructure systems, information ecosystems and markets. When these systems become tightly coupled, a localized health event can create consequences far beyond the original outbreak location.

Institutions are then required to manage competing demands while also maintaining essential services. Laboratories must process increased volumes of samples. Environmental inspectors must divide their attention among multiple investigations. Epidemiologists must track different transmission pathways. Communication teams must respond to competing public concerns and healthcare providers must navigate overlapping diagnostic and treatment challenges.

Resilience is, therefore, the ability to maintain essential functions while absorbing multiple, interacting disruptions. The COVID-19 pandemic demonstrated how quickly healthcare capacity, supply chains, labor markets and public institutions can become overwhelmed during a crisis. Thus, it is clear that US infrastructure is and remains woefully underprepared for large-scale outbreaks.

The same lesson applies to smaller-scale biological events: disruptions that may appear manageable individually can become far more consequential when they occur simultaneously and compete for limited resources.

Outbreaks disrupt labor markets long before they overwhelm hospitals

Economists frequently distinguish between direct costs and indirect costs when looking at an event’s impacts. Traditionally, economists have measured outbreaks through direct medical costs, mortality and lost productivity. While those metrics remain essential, they do not fully capture the indirect costs an event can have in today’s complex, interconnected economy. In many modern outbreaks, indirect costs represent a substantial share of the total burden.

The direct costs of infectious diseases are relatively easy to identify. Patients require care from laboratory testing to medications to hospitalization. Public health agencies must dedicate personnel to environmental investigations and epidemiological surveillance. Government agencies and the private sector must also coordinate and communicate. Those expenditures are substantial. Yet, healthcare expenditures represent only the first wave of economic impacts. The broader economy absorbs the aftershocks and indirect costs.

The labor market is just one example. cyclosporiasis infections can produce prolonged gastrointestinal illness requiring treatment and recovery time. Workers may miss shifts and caregivers may leave work to care for ill family members. Legionnaires’ disease can produce even larger economic consequences because severe cases frequently require hospitalization and recovery periods that delay a return to work.

During outbreaks, employers may face staffing shortages, overtime expenses and reduced productivity. A CDC-supported analysis estimated that the lifetime economic burden of Legionnaires’ disease cases in the United States in 2014 was approximately $835 million. This included substantial productivity losses from absenteeism and premature deaths. 

These losses represent more than accounting figures. Reductions in productive capacity don’t affect business alone. Individuals, households and regional economies all shoulder the economic burden as well.

Infrastructure failures create economic liabilities

Costs, however, don’t go away when people are healthy and able to return to work. There are also long-term infrastructure costs that come with outbreaks. Consider the recent Legionnaires’ disease cluster in New York City. Legionnaires’ disease illustrates another important economic principle: many outbreaks originate not from individual behavior, but from infrastructure conditions. 

Legionella bacteria thrive in certain water environments, including building water systems and cooling towers. As of July 2026, New York City officials reported dozens of confirmed cases, deaths associated with the cluster and remediation of cooling towers where Legionella bacteria were identified. Preventing outbreaks, therefore, depends on infrastructure maintenance and regulatory oversight. Unfortunately, maintenance and oversight are often overlooked in favor of saving money.

Deferred maintenance may appear financially attractive in the short term; however, when infrastructure failures lead to disease outbreaks, communities incur the costs. Healthcare expenditures, legal liabilities, business disruptions and maintenance costs all pile up. The city’s response required extensive testing of the affected cooling towers, environmental investigation, remediation efforts and coordination with healthcare providers. The economic lesson is straightforward: preventive investment often costs less than emergency recovery.

Foodborne outbreaks reveal hidden supply-chain vulnerabilities

Similarly, the cyclosporiasis outbreak required extensive coordination among federal agencies, state health departments, food producers, distributors and restaurants.  Because cyclosporiasis has a long incubation period and requires specialized laboratory methods for confirmation, tracing the source of contamination can be particularly challenging. Federal and state investigators eventually linked illnesses to shredded iceberg lettuce served at certain restaurant locations, leading to product removal, recalls and heightened consumer concern.

Perhaps the clearest lesson from the cyclosporiasis outbreak is that food systems are only as resilient as their weakest link. Modern food production depends on highly interconnected networks: farms, processors, distributors, transportation providers, retailers, restaurants. A contamination event at a single point can affect businesses and consumers hundreds or thousands of miles away.

For economists, this is not only a food safety problem. It is a supply-chain resilience problem. One contamination event can lead to product recalls, restaurant inventory losses, supplier disruptions, reduced consumer demand, increased inspection and compliance costs, and reputational damage throughout an industry. 

So, the cyclosporiasis outbreak was not contained to the healthcare sector; its effects extended far beyond and directly affected businesses. Consumer concern over contaminated lettuce contributed to reduced restaurant traffic and sales impacts, demonstrating that uncertainty itself carries economic costs. 

Consumer confidence is a form of economic infrastructure

Economists often discuss infrastructure in terms of physical elements such as roads, electricity and telecommunications. Both outbreaks described above did affect physical infrastructure: Legionnaires’ disease affected cooling towers, and cyclosporiasis affected food supply chains. But there is another form of infrastructure  that deserves just as much attention: public trust. 

During an outbreak, consumers rarely have complete information about the source, severity or duration of a risk. Instead, they make decisions based on perceived risk and their confidence in institutions, businesses and public health authorities. When uncertainty increases, consumers often avoid entire categories of products rather than attempting to distinguish between safe and unsafe sources. In other words, when information is incomplete or communication is unclear, uncertainty itself becomes an economic driver.

This behavior has important economic consequences. A restaurant, retailer or producer may experience financial losses even when it is not directly responsible for contamination because consumers often respond to uncertainty rather than confirmed exposure. As a result, reputational damage can spread faster than pathogens themselves. 

That is why restoring consumer confidence is an important factor in responding to outbreaks. However, restoring public trust requires more than resolving the immediate health threat. It requires transparency, rapid communication, credible monitoring systems and visible corrective action. 

Public trust functions much like physical infrastructure, as it supports economic activity, and when damaged, can have grave effects on industries. Rebuilding it requires time, investment and sustained commitment.

Climate, globalization, and aging infrastructure are changing the risk landscape

These outbreaks should not be viewed as isolated events. A changing risk landscape is increasing the likelihood that infectious disease events will intersect with other economic and environmental disruptions. This includes extreme weather events, transportation challenges, workforce shortages and infrastructure failures.

Climate variability influences agricultural conditions, water systems and environmental factors that can affect pathogen persistence and transmission. Globalized food systems have improved efficiency and expanded access, but longer and more complex supply chains can make contamination events more difficult to trace and contain. Aging infrastructure, particularly water management systems, introduces additional vulnerabilities that can increase exposure risks.

Taken together, these trends suggest that future outbreaks are increasingly likely to occur alongside other disruptions. Addressing these risks requires integrated thinking. Public health preparedness cannot be separated from infrastructure policy. Food safety cannot be separated from supply-chain management. Risk communication needs to recognize consumer behavior.

Perhaps, then, the most important lesson from recent outbreaks is that public health preparedness should be understood as an investment in economic resilience. Research increasingly demonstrates that public health spending contributes to stronger communities by improving population health, supporting workforce productivity, and strengthening regions’ ability to withstand external shocks.The response to cyclosporiasis and Legionnaires’ disease offers a broader lesson: economic resilience begins long before patients arrive at hospitals. The next outbreak may begin on a farm, in a cooling tower, or somewhere we do not yet anticipate. Its consequences, however, will travel through labor markets, supply chains, public institutions and financial systems.

Preparing for those cascading effects is no longer simply a public health priority. It is an economic imperative.

[Cheyenne Torres edited this piece.]

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.