BY DR. ANDREW STAINBACK
Conservation not only protects nature, it creates jobs and expands economic opportunity.
Completion of the 1-mile Tamiami Trail bridge marked a very important moment in Everglades restoration; restoring water flow into Northeast Shark River Slough.
We receive many important benefits from natural ecosystems. These benefits include raw materials, climate regulation, protection from natural disasters, recreation, pharmaceuticals, and many others. However, ecosystems throughout the world have been degraded by human exploitation and conversion to other uses. While historically these changes have led to economic growth and development, it is becoming clear that they are increasingly threatening human wellbeing and continued economic prosperity.
The United Nations Millennium Ecosystem Assessment estimates that globally, 60% of the benefits that we get from ecosystems are being degraded or used unsustainably. As a result, there is a growing realization that actively restoring degraded ecosystems is vitally important in promoting future economic development and human welfare.
Over the last several decades there have been many economic studies that have estimated the value that we get from ecosystems and their restoration. For example,
several comprehensive and widely publicized economic studies have indicated that, on a global scale, the monetary value to society of these ecosystem benefits are several
times the size of global Gross Domestic Product (GDP)5–7.
Closer to home, in 2010 Mather Economics estimated that the benefits generated from the completing the Comprehensive Everglades Restoration Plan (CERP) would be $46.5 billion8. However, in addition to the benefits we get from restored ecosystems, the work and investments done to actively restore ecosystems creates jobs and generates economic activity. Though these jobs and economic activity are important, less research has been focused on quantifying them. Fortunately, this has begun to change. In recent years there have been several economic studies that have estimated the economic activity and jobs generated by ecological restoration projects in the U.S.
Estimating the Economic Impact of Ecological Restoration
To estimate the jobs and economic activity created by investments such those associated with ecological restoration, economists rely on input-output (IO) models. The essential basis of these models is the fact that when money is spent, that expenditure has “ripple” effects in the economy. These effects are categorized as direct effects, indirect effects, and induced effects. In the context of ecological restoration, the direct effects refer to jobs and economic activity generated by the expenditures of businesses doing restoration work. These expenditures would include things such as earth moving machinery, fuel, and monitoring equipment.
Indirect effects refer to the jobs and economic activity generated by the suppliers of businesses doing the restoration work. Finally, induced effects are the jobs and economic activity generated by the expenditure of the income earned by businesses and people as the result of the direct and indirect effects. The total economic impact of ecological restoration is the sum of direct, indirect, and induced effects. Sometimes impact analyses will also estimate other effects such as labor and income.
In recent years there have been several studies that have estimated the economic impact of ecological restoration in the United States. For instance, a group of researchers recently conducted two studies to estimate the economic impact of ecological restoration work in the United States. In the first study, they estimated the economic impact of ecological restoration activity by surveying firms and organizations doing restoration work in the United States. The survey respondents included private and non-profits that worked on restoration projects funded and/or mandated by the federal government and work that was initiated and funded in the private sector.
The results indicated that the total annual impact of ecological restoration work in the U.S. economy was over $24 billion and over 221,000 jobs (see below).
A second study, involving the same authors, conducted a detailed review of restoration projects at various scales (from state, regional to national) and found that ecological restoration generated as many as 33 jobs per $1 million spent.
Another group of researchers studied the economic impacts of ecological restoration expenditures in coastal ecosystems by the National Oceanic and Atmospheric Association (NOAA) through the American Recovery and Reinvestment Act (ARRA). As part of the ARRA, NOAA received $167 million to restore coastal habitats. The study authors looked at data from 44 projects funded by ARRA that were completed or near completion at the time of the study and found that the number of jobs created per $1
million spent ranged from around 15-33 with an average of about 1710. The authors note that the employment effects of coastal ecosystem restoration compare favorably to other
industries especially traditional extraction industries such as coal, oil, and gas. For instance, these industries (coal, oil, and gas) create around 5-7 jobs per $1 million spent.
While no studies such as the ones discussed above have been done regarding Everglades restoration specifically, estimates from the U.S. Army Corps of Engineers
indicate that the Everglades restoration projects that form CERP would generate around 19 jobs per $1 million spent.
Current construction on the EAA Reservoir.
It is important to note that the numbers discussed here describe the economic activity and jobs generated through the actual restoration work and do not include the benefits
resulting after the restoration work is done. For instance, a study conducted in 2010 estimated that Everglades restoration as envisioned by CERP would provide around $46 billion in benefits and generate over 440,000 jobs. The economic activity and jobs generated from carrying out the restoration would be in addition to these benefits.
Economic prosperity and protecting nature are frequently presented as tradeoffs. In reality, ecological restoration is often a necessary step in expanding economic opportunities.
1. Millennium Ecosystem Assessment. Ecosystems And Human Well-Being. Synthesis (Island Press, 2005).
2. TEEB. The Economics of Ecosystems and Biodiversity (TEEB) for National and International Policy Makers.
The Economics of ecosystems and biodiversity (Routledge, 2011).
3. Rohr, J. R., Bernhardt, E. S., Cadotte, M. W. & Clements, W. H. The ecology and economics of restoration:
When, what, where, and how to restore ecosystems. Ecol. Soc. 23, (2018).
4. BenDor, T., Lester, T. W., Livengood, A., Davis, A. & Yonavjak, L. Estimating the Size and Impact of the
Ecological Restoration Economy. PLoS One 10, e0128339 (2015).
5. Costanza, R. et al. The value of the world’s ecosystem services and natural capital. Nature 387, 253–260
6. Costanza, R. et al. Changes in the global value of ecosystem services. Glob. Environ. Chang. 26, 152–158
7. de Groot, R. et al. Global estimates of the value of ecosystems and their services in monetary units.
Ecosyst. Serv. 1, 50–61 (2012).
8. McCormick, B., Clement, R., Fischer, D., Lindsay, M. & Wilson, R. Measuring the Economic Benefits of
America’s Everglades Restoration. An Economic Evaluation of Ecosystem Services Affiliated with the World’s
Largest Ecosystem Restoration Project (2010).
9. BenDor, T. K., Livengood, A., Lester, T. W., Davis, A. & Yonavjak, L. Defining and evaluating the ecological
restoration economy. Restor. Ecol. 23, 209–219 (2015).
10. Edwards, P. E. T., Sutton-Grier, A. E. & Coyle, G. E. Investing in nature: Restoring coastal habitat blue
infrastructure and green job creation. Mar. Policy 38, 65–71 (2013).