Effects of the Deepwater Horizon Oil Spill on Human Communities: Catch and Economic Impacts

Economic activity associated with commercial and recreational fisheries in the northern Gulf of Mexico can be dampened when there are significant impacts to the biophysical environment and human communities due to natural or man-made disaster events. Due to its size and scope, the Deepwater Horizon incident caused extensive damage to marine and shoreline habitats, affecting activity in both the commercial and recreational fishing industries. The impacts on the Gulf of Mexico ecosystem during and after the Deepwater Horizon oil spill are well documented but it is also critical to evaluate impacts on economic activity in sectors that are reliant on this ecosystem. This chapter details estimates of the changes in economic activity supported by commercial and recreational fisheries in the U.S. regions of the northern Gulf of Mexico due to the Deepwater Horizon oil spill. Estimates are based upon biophysical model projections from the Atlantis model for scenarios that represent conditions with the oil spill and the counterfactual without the oil spill modeled over a 10-year time horizon, and regional economic impact analysis methods. Results indicate that the total economic impacts for the period 2010–2020 of foregone commercial fishing revenues and recreational fishing expenditures as a result of the Deepwater Horizon oil spill are a loss of over 25,000 jobs, $2.3 billion in industry output, $1.2 billion in total value added or gross regional product, $700 million in labor income, $160 million in state and local tax revenues, and $160 million in federal tax revenues.