09 June 2010

BP spill cost to Florida: almost US$11 billion

Environmentally, the impact of the BP oil spill on tourist-dependent Florida may be incalculable but economically, a conservative early estimate sets the figure at $10.9 million.

That’s the figure economist Sean Snaith came up with in a preliminary analysys.

Those figures reflect what would happen if Florida’s 23 Gulf Coast counties lose 50 percent of their tourism and leisure jobs and spending. Snaith’s analysis covers all of the coastal counties from Escambia to Monroe.

If the Gulf Coast counties lose just 10 percent of their tourism and leisure jobs and spending due to the spill, the estimated statewide losses would still be nearly 39,000 jobs and $2.2 billion in spending.

The tourism industry brings 80 million visitors a year to the state, who spend $60 billion.

Tourism jobs employ just under 1 million Floridians. Even before the April 20 spill off the Louisiana coast, Florida was already struggling with the recession and unemployment that was 12 percent in April.

"The timing couldn't be more unfortunate," said Snaith. "It's going to ripple throughout Florida's economy, and the question is, 'How big is it going to be?'"

To develop his preliminary analysis, Snaith examined the values of the tourism and leisure economies in all of the Gulf counties. Combined, they produce nearly 269,000 jobs and about $12.4 billion in annual spending.

Using the 10 and 50 percent figures, he then projected the impact of losses there on other businesses in the Gulf counties and across the state. For example, produce shops no longer would supply restaurants that have closed, and trucking companies no longer would haul that produce.

Snaith, the director of UCF’s Institute for Economic Competitiveness, is a national expert in economics, forecasting, market sizing and economic analysis who authors quarterly reports about the state of the economy.

Visit Florida, the state's tourism marketing agency, said in an update that tar balls ranging in size from dimes to silver dollars continue to be found in widely scattered areas along the Panhandle. The tar was being cleaned up, but the agency said additional effects of the spill should be felt within the next few days.

There were no beach closures, and state water remained open to fishing and other business.

By David Wilkening