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Economics and Marine Conservation

A case study on the linkage of marine conservation and economic effects.

By Dave Bethany


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AbstractThe Broad PictureIndications of ProblemsOptions


Environmental activism is normally related to spending requirements and costs, with little emphasis placed on the returns received through these activities. Environmentalism  becomes a social necessity when it is shown that failure to protect a resource can or does  result in severe economic hardship to a region or locale. This case study will show the direct and indirect economic impact on the State of Florida by marine related resources and the imperative of conservation efforts in support of this economic impact.

The Broad Picture

In the United States, the adjacent ocean realm is fifty percent larger than the land mass of the U.S.. The ocean related economy is 2.5 times larger than that of the land-based economy. Coastal states comprise 3/4ths of the economic structure of the United States. Ocean policies, while given some credence, do not hold the esteem of other economic areas, such as agriculture.

The U.S. Department of Agriculture is a cabinet level position in the executive branch of the federal government. The position most reflective of the ocean environment is the National Ocean Service, which is a subset under the National Oceanic and Atmospheric Administration, which is part of the U.S. Department of Commerce. In Washington, the higher the position level, the more power is wielded. The requested 2004 budget for N.O.S. was $411 million.  To put this number in perspective, the U.S. Department of Agriculture requested $687 million for salaries and expenses for the employees of the Animal and Plant Health Inspection Service, which was actually a reduction of $148 million from the 2003 budget.

In the United States, there are over 28 million ocean related jobs. According to the Bureau of Labor Statistics, there are slightly more than 10 million jobs related to farming, food and food preparation . We budget 50% more for an area of the economy that provides a little more than one-third of the jobs related to the ocean environment. The ocean economy is the largest employment area in the United States.

In Florida, there are over 700,000 ocean related jobs. The direct impact of ocean related activities is staggering in the state. In Broward County alone, the economic impact of this area equates to $2.1 billion in annual revenues and over 36,000 jobs . In the four southeastern Florida counties, Miami-Dade, Broward, Palm Beach and Monroe, the ocean environment generates over $4.4 billion in revenues and provides employment to over 61,000 people.


The Indications of Problems

Florida has the second longest coastline in the United States. The Gulf Coastal region holds the second largest biomass in the Caribbean basin. In 2003, across the United States, there were 18,000 beach closings, an increase of almost 50% from the previous year .  Beach closings have a direct economic impact on an area. When a beach closes, local merchants lose business. 88% of these closings were due to environmental hazards. Better monitoring standards have been a substantial reason for the rise in closings. Almost 4,000 beach closings occured in Florida in 2003. All closings in Florida were related to elevated bacteria levels beyond what was considered safe.

Since 1996, over 37% of the live corals in the Florida Keys have died. A similar bleaching event happened in the Pacific regions in 1996, but the corals recovered. This recovery has not happened in Florida.

Corals survive in an extremely close range of temperature and nutrient levels. Should temperatures rise by even two degrees C. for more than a few weeks or should water-borne nutrient levels rise by as little as two percent, this can cause a mass exterminations. A further find is that increases in UV radiation causes similar effects.

Loss of living coral directly results in a reduction of biomass in and around the reef area. This biomass reduction can be directly linked to economic losses. Fish become scarce, tourism can be reduced. This creates a ripple effect throughout the entire economy.

When we combine the beach closings with the losses in coral reefs we can surmise that high nutrient levels in the water can be a cause for both instances. High nutrient levels often originate through runoffs and waste disposal.

We can look at the direct impact of events such as beach closings on a local economy by focusing on one area in Florida where beach related tourism accounts for a majority of the revenues of that area. The city of Destin is located in Okaloosa County, Florida, in the panhandle of northwestern Florida. Beach related tourism equates to 61% of the revenues of Okaloosa County. In hard numbers, tourism generates over $188 million in revenues and creates over 2,100 jobs. In that the beach at Destin is the prime attraction for the area, even a minor closing can have a substantial economic impact on the area.

In 2003, Okaloosa county experienced 497 beach closing due to elevated bacteria levels. In some cases, a beach (Garniers Park) was closed for almost 10 months of the year. The Gulf Island National Seashore was closed for a total of 28 days. Henderson Park Beach for 18 days. There can be no denying that extended events such as these would have a detrimental economic impact on an entire region, especially one that relies so heavily on tourism dollars from its beaches.

Can coral bleaching have a similar effect on tourism? In Herman Cesar’s report on the 1998 bleaching event in El Nido, Phillipines supports this. El Nido is a small area that depends on tourism for the majority of its economy. In 1998 a major bleaching event took place, which destroyed over 40% of the live corals in the area. Sr. Cesar’s report showed that over 60% of the diving tourists were dissatisfied with their experience due to the destruction of the reef, versus a dissatisfaction level of about 12% prior to the event. As a side note, over 70% of those in the survey said they would be willing to pay more were done to protect the reef and surrounding marine environment.  In that one small area, the estimated direct economic losses come to almost 30% of the pre-event revenues.


According to the United States Commission on Ocean Policy, we must perform the following steps:

  1. An ocean policy must be developed that is sustainable.
  2. We must recognize the value of our ocean resources and develop a principle of stewardship.
  3. Our ocean policies must be linked to land and atmospheric relationships.
  4. We must manage on the principle that our policies are geared to an interconnected ecosystem and not a political system.
  5. Ocean policy must reflect multiple use management, tying conservation to economic uses.
  6. Downward trends in biodiversity must be reversed.

To implement these recommendations requires a new understanding of the interconnectivity between our ocean realms and our social structure. We must recognize that a loss in the marine environment can have a direct and dire effect on our economic and social stability. Education is one method of bringing to problems and solutions to light. Education cannot be in a high-handed, pure academic atmosphere, but instead must be geared to a level that brings home the direct impact of inaction or inappropriate action. If society understands that ignoring the problem will have an adverse affect on their fiscal lifestyle, then society will push for advancements in protecting our marine environments.