USC Researchers forecast severe job loss and other economic impacts from major disruptions while pointing to the importance of local strategies to ensure a secure water supply
According to a new study conducted by a team of USC economists led by Price School of Public Policy Research Professor Adam Rose, Los Angeles County could suffer enormous job and GDP losses if a major disruption to the region’s imported water supplies were to occur from a shutdown of the California Aqueduct due to a man-made or natural disaster such as an earthquake.
The report – “Total Regional Economic Losses from Water Supply Disruptions to the Los Angeles County Economy” – was released on Nov. 29 by the Los Angeles County Economic Development Corporation (LAEDC), which provides economic development programs and services throughout the region.
The report shows that Los Angeles County could face severe economic scenarios resulting from a 12-month and 24-month shutdown of the California Aqueduct, for example:
Speaking about the report’s key findings, Ed Casey, chair of the LAEDC Water Subgroup and partner with Alston & Bird LLP, stated, “by commissioning this study, we wanted to put an economic price tag on what experts have long known, namely that a disaster could significantly disrupt our region’s water supplies and cause extraordinary economic and social consequences.”
He added, “and what a destructive price tag it could turn out to be with the a 12-month disruption of the aqueduct potentially resulting in 550,000 lost jobs in Los Angeles County; that’s close to 15 percent of our county’s entire employment base and nearly twice the number of jobs lost in LA during the Great Recession. These numbers should startle policy makers into taking the necessary actions to prepare for such a major disruption in our water supply system.”
The report demonstrates the importance of protecting imported water sources that are vulnerable to natural disasters, developing local water supplies, maximizing groundwater storage, and implementing locally driven strategies to expedite the development and delivery of critical water infrastructure projects as well as move to a smarter design of the built environment.
One of the report’s major takeaways is that without additional preparation Los Angeles County could suffer devastating impacts on its economy and the quality of life of its residents if a major disruption to the region’s imported water supplies were to occur.
“Our findings indicate how critical water is to the LA County economy and how fragile that relationship is,” said Rose, the report’s lead author, who also serves as coordinator for economics at USC’s Center for Risk and Economic Analysis of Terrorism Events. “Despite many effective investments in water security at the state and local levels, serious consideration should be given to doing even more to protect and maintain the County’s water supply.”
Funding and technical support of this independent study were provided by Los Angeles Department of Water and Power, Metropolitan Water District of Southern California, Veolia Water, Water Replenishment District of Southern California, and Woodbury University.