Contamination of coastal areas with high amenity value is a common feature of many oil spills. In addition to costs incurred by clean-up activities, serious economic losses can be experienced by industries and individuals dependent on coastal resources. Usually, the tourism and fisheries sectors are where the greatest impacts are felt. However, there are also many other business activities and sectors that can potentially suffer disruptions and loss of earnings.
Tourism
Disruption of recreational activities such as swimming, boating, angling and diving caused by oil contaminated shores is usually relatively short-lived. Once shorelines are clean, normal trade and activities would be expected to resume. However, more long term and damaging economic impacts can occur when public perception of prolonged and wide-scale pollution remains long after the oil has gone. In these circ*mstances, it takes an even longer period for business activities to return to normal, sometimes with far reaching consequences. For example holidaymakers may decide to book holidays in other regions in which case hotels, tour operators and potentially their suppliers may suffer losses. This may also affect transport companies, national parks and other local, tourism-dependent businesses. In some cases, a combined strategy of regional advertising and promotional campaigns may help to counteract the degradation of the image of an affected area caused by continued negative publicity.
The most vulnerable business will be those that have no alternative means of income. For example, a luxury resort may be unable to continue operating as it is dependent on tourists for all of its income. On the other hand, a supermarket or café that makes a large proportion of its earnings from holidaymakers would still retain a proportion of its business from local residents.
A company that is wholly dependent on tourists may still be able to find an alternative source of income. For example, a hotel may provide food and lodging to responders of the incident. In some cases, there may be response personnel on site for many months and the losses caused by an absence of tourists may therefore be negligible for these businesses.
In summary, a return to normal trade for the tourism sector requires not only an effective clean-up programme, but also a strategy to restore any loss of appeal to tourists that the area may have suffered.
FAQs
It helps to increase wages. Not only does fracking help to create jobs and save Americans money, but it also helps to increase wages in the United States. In counties where shale resources are extracted through fracking, there has been an increase in average incomes by 10 to 20 percent.
What are 3 economic impacts of an earthquake? ›
The economic cost of natural disasters is usually expressed in physical terms: Destruction of assets, crop losses, costs of reconstruction and the like.
What are the economic effects of banning fracking? ›
The broader economic impact of the hydraulic fracturing ban would be substantial. Compared to a world with hydraulic fracturing, in 2025, the United States economy would have 7.7 million fewer jobs, $1.1 trillion less in gross domestic product (GDP), and $950 billion less in labor income.
What are the economic effects of a hurricane? ›
Power outages and transportation disruptions can also hinder businesses' ability to receive and ship products. These factors can lead to production and delivery delays, causing lost revenue and damaging a company's reputation. Another economic impact of hurricanes on businesses is the loss of customers.
Who benefits financially from fracking? ›
Energy consumers are seeing economic gains
Moreover, all types of energy consumers, including commercial, industrial, and electric power consumers, saw economic gains totaling $74 billion per year from increased fracking.
What are 2 negative effects of fracking? ›
Used extensively in the U.S., fracking has led to heightened concerns about its impact on the environment and human health. The process creates vast amounts of wastewater, emits greenhouse gases such as methane, releases toxic air pollutants and generates noise.
What are examples of economic impacts? ›
Any change in economic activity – a concert or another event, an opening of a new retail store, expansion of a manufacturing facility – triggers a larger change in the local economy. An economic impact study is a way to measure the resulting increase in output produced, incomes earned and jobs created or supported.
What are the three types of economic impact? ›
The total impact of an organization is a compilation of the direct impact, the indirect impact, and the induced impact generated in the economy as a result of the organization.
What are 3 economic impacts of an event? ›
Economic impact includes direct, indirect, and induced effects. Direct effects are the initial change in the economy. For festivals and events, this is spending by attendees. It includes spending both at the festival/event and at other businesses around the community.
What are the pros and cons of fracking? ›
The pros and cons of fracking
- Pro: alternative to coal.
- Con: a question of demand.
- Pro: access to materials.
- Con: risk of earthquakes.
- Pro: job creation.
- Con: air and water pollution.
Fracked communities had significant economic gains. They produced an additional $400 million of oil and natural gas annually three years later, and had increased total income (3.3-6.1 percent), employment (3.7-5.5 percent), salaries (5.4-11 percent), and housing prices (5.7 percent). But the quality of life declined.
How much does the US rely on fracking? ›
More than 95 percent of U.S. natural gas and oil wells today are developed using hydraulic fracturing. According to the Bureau of Land Management, onshore federal lands produce about 8 percent of the nation's oil and 9 percent of its natural gas.
Why was Katrina so costly? ›
The storm interrupted oil production, importation, and refining in the Gulf eden, thus having a major effect on fuel prices. Before the storm, one-tenth of all the crude oil consumed in the United States and almost half of the gasoline produced in the country came from refineries in the states along the Gulf's shores.
How did Katrina affect the economy? ›
During the first 10 months after the hurricane, the city suffered an over-the-year average loss of 95,000 jobs. At the trough of the job loss, in November 2005, employ- ment was 105,300 below the previous year's November figure. By June 2006, the over-the-year job loss, though smaller, was still substantial (92,900).
What is the economic impact of tornado? ›
Indirect losses that occur from the destruction of physical assets can be quite significant. These losses include lost production and sales, incomes and labor time, increased commute times, increased transportation costs from goods having to be rerouted, decreased tourist activity, and ongoing utility disruptions.
Which of the following is an economic impact of fracking? ›
Fracked communities had significant economic gains. They produced an additional $400 million of oil and natural gas annually three years later, and had increased total income (3.3-6.1 percent), employment (3.7-5.5 percent), salaries (5.4-11 percent), and housing prices (5.7 percent).
What are the societal impacts of fracking? ›
In a study of 104 fracking-impacted residents of Appalachia, Virgina, it was found that respondents experienced disruptions to social cohesion, erosion to community pride, feelings of being exploited, and a breakdown of shared community values.
What are the economic impacts of hydraulics? ›
Technological advances by the oil and natural gas industry have been a boon for the environment and the economy. Because of hydraulic fracturing our air is cleaner, our economy is stronger, and we have stabilized global energy prices, reducing costs for American consumers and helping allies around the globe.
