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New Study: Colorado River Economy Valued in Billions

Posted: 01/20/2015
by Nathan Fey

This week marked the release of another major economic impacts report from Protect the Flows, this time focusing on the basin-wide implications of shortages on the Colorado River. Featured in a big Wall Street Journal spread today, the study’s authors point it out pretty succinctly: “We are getting to the crunch now,” said Timothy James, an Arizona State economics professor who led the study. “The Colorado River is the lifeblood of the entire region.” The study calculates the billions of economic losses that the region will see if (or when) flows decrease as a result of long-term drought and climate change.

The Study examined the economic importance of the Colorado River for the Upper Basin Region (Wyoming, Utah, Colorado and New Mexico) and Lower Basin Region (Arizona, Nevada, and Southern California) for one calendar year (2012).

The Economic impacts of the Colorado River, are measured for three categories; Gross State Product, employment, labor income.  The contribution of the Colorado River to annual GSP for each of the Upper Basin States ranges from $22 billion to $189 Billion. For the Lower Basin States, the estimates range from $115 bilion to over $657 Billion.

While not explicitly focused on the recreation economy, the study takes into account major industries and employment losses and finds that Colorado River water accounts for nearly two-thirds of the basin’s gross state product and that among the hardest hit sectors in dollar terms would be real estate, finance, professional and technical services, and retail.

For paddlers, Protect the Flows’ earlier study, Colorado River, Inc.  on the recreation economy generated by the river remains a great resource, with its staggering finding that the river is a $26 billion recreation resource that employs a quarter million Americans.