This publication summarizes the results of an economic survey of the direct economic impacts of the Deepwater Horizon oil spill on the business operations of the participating Mississippi seafood and commercial and saltwater recreational fishing establishments in the year 2010. The direct economic impacts are measured in terms of the “changes in business operations in the year 2010 due to the Deepwater Horizon oil spill” in total annual sales, number of workers employed, length of shut down period, and amount of claims for financial losses filed and received by participating seafood and marine-related establishments.
The 331 Mississippi marine businesses which participated in the survey contributed between 25 to 65 percent of the total annual gross sales or total employment in marine economic sectors included in the impact assessment. The oil spill-related closures of state and federal waters adversely impacted the overall business operations of the participating establishments which were shut-down, on average, by about 4.21 months. The direct economic impacts of the oil spill on these businesses resulted into a decline in 2010 by almost one-half of the annual total sales and one-third of the total employment as compared to 2009.
The 18 Mississippi charter boats which participated in the survey created 41 percent of all the jobs generated by this economic sector in 2009. Due to the oil spill, these establishments were shut-down for about 5.37 months in 2010. As a result, the charter boats for-hire lost more than one-half of total sales in 2010. Despite the shut-down and reduction in total sales, the number of workers employed by the participating charter boats for-hire increased by 6.4 percent.
The 160 Mississippi commercial fishing businesses which participated in the survey accounted for 44 percent of the total commercial landings in 2009. These commercial fishing vessels were shut-down for about 6.01 months in 2010 as a result of the oil spill. These fishing establishments reported less than two-thirds loss in annual total sales in 2010. Due to the shut-down and reduction in annual total sales, the net percent decrease in employment in 2010 reported by participating commercial fishing businesses was 44.1 percent.
The 111 eating and drinking places located in Mississippi coastal and adjacent counties which completed the survey provided jobs to 65 percent of all the workers in this sector in 2009. These restaurants were shut-down for less than a week in 2010 as a result of the oil spill. They reported that lost more than one-fourth of annual total sales in 2010. Because of shut-down and reduction in total sales, the net decrease in employment in 2010 reported by participating eating and drinking places was 18.2 percent.
The 12 Mississippi live bait and marina firms which joined the survey contributed 25 percent of all the jobs provided by this economic sector in 2009. These marine establishments reported that they were shut- down for 2.37 months in 2010 due to the oil spill. As a result, the live bait and marina businesses suffered a reduction in annual total sales by more than one-half in 2010. The shut-down and reduction in total sales reported by the participating live bait and marine firms resulted to a net decrease in employment by about 16.9 percent.
The 30 Mississippi seafood dealers which responded to the mail and online survey reported a decline in total sales by almost one-half in 2010. These seafood businesses, which produced 44 percent of all the jobs of this sector in 2009, were shut-down for 3.80 months in 2010. Due to the shut-down and reduction in total sales, the net decrease in employment in 2010 reported by participating seafood dealers was about 52.2 percent.
The majority of the participating Mississippi establishments stated that they filed direct claims associated with the oil spill in 2010. When asked whether they filed a direct claim with BP for financial losses in 2010, almost three-fourths of the participating businesses responded on the affirmative. About one-fifth of the establishments which joined the survey did not file a direct claim. More than one-third of all the direct claims filed by the participating marine-related firms were compensated by BP or the Gulf Coast Claims Facility.
Less than one-twentieth of the participating Mississippi establishments carried business interruption insurance. None of the charter boats for-hire and the live bait and commercial marinas carried business interruption insurance. Commercial fishermen showed very low preference for insurance protection since only 1.3 percent of the participants reported carrying insurance coverage. Similar hesitance to carry insurance protection was expressed by the participating seafood dealers and processors. Among the eating and drinking places, one out of every ten participating establishments reported carrying business interruption insurance.
It is strongly suggested that follow-up surveys of business establishments be conducted in order to measure the medium and long-term impacts perceived by commercial fishing and seafood establishments affected by the oil spill. These primary data will establish the cause and effect relationships between the associated economic impacts in affected economic sectors and the oil spill incident.
Posadas, Benedict C. 2015. Economic Impacts of the Deepwater Horizon Oil Spill to Mississippi Seafood and Commercial and Recreational Fishing Sectors in the Year 2010. Mississippi Agricultural and Forestry Experiment Station Bulletin, Mississippi State, Mississippi.