By Calvin Meister, Planning Technician at M-Group
Since the dawn of intercontinental trade, national economies have heavily relied on their shore-adjacent communities. At a time when the global market is more deeply intertwined than ever, locales that can ship and receive imports and exports are increasingly important to their region. In 2012, counties along the shoreline produced over 40% of the U.S.’s $16 trillion GDP, $343 billion relying on oceanic resources, such as offshore mineral extraction and fishing operations, as the sole input.
However, ocean economies have a wide reach, and play important roles in the economies of inland communities as well. Understanding how ocean economies influence inland ones can have a great impact in how counties and cities all over California and the nation plan for the future.
To illustrate the relationship between coastal and inland economies, NOAA’s newly formed Office for Coastal Management (OCM) released two powerful online tools: Economics National Ocean Watch (ENOW) and the story map “The Oceans and Coasts – A Driver for Inland Economic Activity.” Both applications bring together years of data from multiple agencies for the first time, shedding light on the importance of our nation’s shoreline economies and the leading role California’s shore economies play in “the geographic interdependence of the nation”.
ECONOMICS NATIONAL OCEAN WATCH (ENOW)
ENOW is a freely available, user-directed online tool allowing users to both visualize and quantify coastal commerce within the U.S. It compiles 2005-2012 ocean economy data from the U.S. Bureaus of Labor Statistics, Economic Analysis, and the Census, based on the designated six ocean economy sectors:
- Living Resources;
- Marine Construction;
- Marine Transportation;
- Offshore Mineral Resources;
- Ship and Boat Building; and
- Tourism and Recreation.
When a user visits the site, he or she must first select a state and county. The user may then explore several indicators measuring the relationship between the county and the total ocean economy in terms of employment, establishments, wages, and GDP. The economic indicators include:
- Percentage of the total ocean economy the county represents;
- County’s rank compared to all other shoreline economies;
- Number of people employed in the ocean economy, including self-employed individuals;
- Number of establishments associated with the ocean economy and average number of employees per each;
- Total wages paid and average wage per employee; and
- Total GDP produced and average amount per employee.
The user may also further filter the results by selecting one of the six ocean economy sectors listed above.
As an example, a quick investigation shows that San Francisco County’s coastal-related economy is mostly attributed to tourism and recreation related activities, including drinking establishments, hotels, marinas, boat dealers and charters, campsites and RV parks, scenic water tours, manufacture of sporting goods, amusement and recreation services, recreational fishing, zoos, and aquariums. In 2012, tourism and recreation represented 92.4% of the County’s total ocean economy GDP, ranking 4th out of the 402 U.S. coastal counties, accounting for $3.5 billion, and averaging $64,100 generated per employee.
In contrast, 42.5% of Santa Clara County’s ocean economy GDP comes from marine transportation, which includes deep sea freight, marine passenger transportation, pipeline transportation, marine transportation services, search and navigations equipment, and warehousing. The County ranks 29th of the 402 coastal counties, representing $242.1 million with each employee generating approximately $170,300.
ENOW showcases not only which coastal industries individual county economies rely on most, but also relates each sector’s revenue-generating capabilities. In the examples above, it is clear that for Santa Clara County marine transportation is more lucrative than tourism on a per employee basis, and vice versa.
“THE OCEANS AND COASTS – A DRIVER FOR INLAND ECONOMIC ACTIVITY” STORY MAP
“The Oceans and Coasts – A Driver for Inland Economic Activity” is a journal-style visual representation of the initial data the OCM recovered in an innovative study where it teamed up with several other bureaus and researchers to:
- Capture data on industries reliant on coasts;
- Better understand indirect relationships to the ocean economy; and
- Quantify inland dependencies on coastal and ocean resources.
NOAA’s Jeff Adkins describes it as a “PowerPoint/GIS hybrid.”
The story map uses California as the model for ocean economy analysis throughout the nation, since the state’s economy is quite similar to that of the country at large. California’s ocean economy is also the largest in the U.S. Of the total U.S. ocean economy, in 2012 the state generated 14% of trade, 17% of employment, 13% of revenue ($45 billion), and nearly half a million of the total 2.9 million ocean-dependent jobs. That same year, over $430 billion in goods shuffled through California’s ports, of which over three-quarters were imports.
In the Bay Area, Oakland ports alone accounted for over 10 million tons of exports (two-thirds of the total exports from the region), while Richmond took in over 9.8 million tons of imports (about half of the total imports in the region). Each of the Bay Area’s nine counties play a role in the ocean economy. Napa County, which by far produces the smallest amount of coastal GDP in the Bay, still produces about $29.8 million a year. These numbers underline the importance of Bay Area ports in the states’ shoreline and inland economies, and the significance of their distribution capacities to other states.
“Everything is interwoven, like a spider web,” Adkins says. “All the parts of the economy are connected together; you touch one strand and the whole thing shifts. The ports of California are a great example of that.”
An example of this interwoven spider web is Caterpillar Tractors. Caterpillar Tractors, located in Illinois, is a well-known manufacturer of agricultural machinery. The company’s products are directly responsible for a large portion of the country’s food production and export. However, the company imports the parts it uses from factories across Eastern Asia, and thus relies on the marine transportation industry that makes berth along California’s shore. Should California’s ocean economy become compromised, the national agricultural industry may experience significant losses as well.
PLANNING APPLICATIONS
ENOW’s data on the competitiveness of counties’ ocean economies and industries, the importance of specific resources, and who major stakeholders are, coupled with “The Oceans and Coasts – A Driver for Inland Economic Activity” story map’s analysis of the interdependence of inland and coastal economies, can have major positive repercussions in how jurisdictions plan for their future.
First, economists, politicians, lawyers, planners, and the inquisitive may use these tools to make better-informed decisions on preserving, promoting, or limiting development along the coastline.
Second, jurisdictions may more accurately evaluate the monetary significance of their ocean economies compared to other sectors. ENOW’s analysis discovered several underrepresented stakeholders that are deeply dependent on ocean resources. Independent fishermen, for example, were much more abundant and vital to the ocean economy than previously believed. Understanding how important each stakeholder is in the economy can lead to more robust, responsive and tailored economic development strategies that leverage each community’s assets.
Third, jurisdictions will be able to better comprehend how climate change will affect their communities. An underlining goal for the story map project is to provide policymakers and practitioners with knowledge, tools, and ideas to navigate challenges brought on by climate change for ports, transportation, and supply chains. Infrastructure such as highways and freight lines, responsible for moving materials to and from port facilities, will be threatened by increases in flood events as sea levels rise. The economic impacts of delayed resource distribution aren’t yet quantifiable, but this model can begin to show how other industries may be affected.
In the near future, NOAA and the Bureau of Economic Analysis will release a more comprehensive version of the story map that will integrate ENOW series data with additional economic sectors linked in some way to the ocean. The goal is to expand understanding of the ocean economy and better represent how much inland manufacturers depend on coastal ports when introducing their products to global markets.
NOAA and the Bureau of Economic Analysis are also collaborating to create a “National Ocean Account,” which will identify more ocean-dependent businesses and attribute more encompassing numerical values to the relationship between the ocean and the entire U.S. economies.
The data may further confirm how crucial California ports are in distributing foreign products to various industries within North American borders.
Capturing the indirect or “spill-over” effects of the ocean economy is crucial in understanding the role shore-adjacent communities play in the national economy. “Information is always policy-relevant,” Adkins says. “What we’re doing is showing what’s already there but isn’t often reviewed or properly represented in national datasets. We aim to inform on policy decision-making in a way that’s useful in conversations on multiple scales.”
As part of the largest ocean economy in the nation, California cities will play a leading role in applying the ever-growing knowledge on the ocean economy to develop policies that leverage this sector and foster a healthy and resilient future for their citizens.