Tuesday, March 7, 2017

Winters Economic Impact

Winters Economic Impact
Written by: Conner Goodman
As thanksgiving passes and the cool weather starts to flow in your average northern living american begins hibernation until the cold weather passes and spring begins. For those who are not so average, winter marks the beginning of outdoor adventures for the few frigid months of the year. Skiing, snowmobiling, ice fishing and ice skating just to name a few, are all activities that bring people out of their warm homes and into the cold winter weather. Being the last month of winter I found it appropriate to analyze the economic impact, good and bad of the season many of us have a love hate relationship with.  
Living in Wisconsin it is quite evident that there is a large amount of money being made in the winter, but finding out how much money really is made is quite staggering. Many people do not take into consideration all of the areas that money can be made. Not only is their recreational money to be made, but shovels, coats and hats are a few purchases that can be made the help the economy. Taking a look at the recreational benefit In 2015 Colorado's “Ski Country USA” conducted research that concluded skiing in colorado brings over 4.8 billions dollars of revenue to the state of colorado every winter employing a large amount of the mountainous region.  Making it one of the largest contributors to colorado's taxes and the largest recreational money maker in Colorado.  The state of minnesota states that ice fishing creates a mere 600 million dollars in revenue and 100 million in tax dollars. The revenue that these winter activities creates not only specifically benefit the recreation aspect, but it also benefits the travel industry, hotel industry & food industry. Though there is a lot of benefits there is also a large amount of negative externalities that lead to missed opportunity cost by many people and the government.
The state of New York announced government spending on over 1.1 millions pounds of salt for roads and sidewalks in the state of New York alone. Pennsylvania spent the most of any state in the survey, with expenses of $272 million. The state transportation department estimates it took 2.5 million man hours to respond to winter storms that year. Puting a total of 1.18 billions dollars on transportation related costs in the winter alone. Another problem with the winter is the deadweight loss occurring to businesses that are closed from winter weather or simply do not get the business needed because of winter weather. This is also money not made in the food, transportation and hotel business.
Winters economic impact can vary depending on the person and their work. Some people love it and some people hate it, but there is no doubt that winter has a significant impact on our country's economy.


Sources
'Daniel C. Vock', url: 'http://www.governing.com/authors/Daniel-C-Vock.html'}]. "How Much Did States Spend Battling This Winter?" Governing. N.p., March & april 2015. Web. 06 Mar. 2017.

"Economic Study Reveals Ski Industry's $4.8 Billion Annual Impact to Colorado." Economic Study Reveals Ski Industry's $4.8 Billion Annual Impact to Colorado | Colorado Ski Country USA. N.p., n.d. Web. 06 Mar. 2017.

12 comments:

  1. It is not that surprising how much money goes into winter supplies, especially if there is a lot of snowfall. Like you stated, Colorado is a large skiing and snowboarding spot that many people travel to during the winter, which all of their expenses goes towards the economy. It is crazy how much salt is needed just for New York, it makes you think about how much the total costs are for all of the country as well.

    ReplyDelete
  2. It is interesting to see how the climate in a certain region can have such a large impact on that region's economics. With your example of Colorado, the negative impacts that can be seen from heavy snowstorms are outweighed by the positive benefits they bring to their economy, whether it be through ski lodges, airline tickets to these lodges, and overall spending expenditures from locals and visitors to tackle this cold weather. Similar things happen in Wisconsin, but the impacts are more geared towards the locals having to pay for four wheel drive cars and other necessities for the safety and comfort in living in such cold regions. Same concepts can be applied to states who experience hot temperatures all year round, as their economy is impacted more by beach tourism and summer products, rather than snow tools and ski resorts. Overall, the economics of winter is quite staggering.

    ReplyDelete
  3. I think it'd be interesting to see a map of different companies who sell winter gear, and see where they are located. I can imagine that some of the big ones, such as REI or even companies like Moosejaw, might be based in the Northern part of America, and a majority of their retail stores would also be based near the Midwest, Colorado, and the Northeast. It wouldn't make sense for them to have stores in the South because they wouldn't make as much profit as they would in places with cold weather where consumers could use their products.

    ReplyDelete
  4. The winter season is different for every state and every person. When looking at Wisconsin, the benefits of outdoor activity help the economy, however the maintenance of roads and driveways make people spend more money. Even if this may seem like a loss, consumer spending and state government spending increases, which in turn does help the economy and the GDP. Conversely, the winter months don't affect states like California or Florida. I would think that their amount of tourists and travelers would increase because of all the people who go there for the warm weather, escaping winter. It would be interesting to see how the economy grows (or declines) between each state, but also in comparison to countries around the world. So, even if I'm not the biggest fan of winter, it does have a big impact on spending and the GDP.

    ReplyDelete
  5. The government spending that states in the northern part of the United States have is unique as not all states deal with the snow and ice like we do. The additional government spending increases aggregate demand in these states and provides seasonal job to many people. This results in increased consumer spending which is often times spent on all sorts of winter activities. These months provide the opportunity for many tourist destinations in Wisconsin and across the country to rack in profits as revenues go up. Although there are negative elements to the winter months, the season prompts much investment which allows there to be a very large return resulting in economic growth during this time of year.

    ReplyDelete
  6. Although winter sports and activities have a positive impact on our real GDP as it may increase consumer spending for people that prefer winter activities over summer ones, however I am curious to know how if overall consumer and government spending increases during the winter time. For many states in our country, they really don’t have a winter season, so their spending remains relatively the same throughout the year. However for northern states, there are many costs that are related to the winter season.

    ReplyDelete
  7. Although there are many costs which go along with winter such as buying more gas to allow engines to cope with cold temperatures or snowplows, I would argue summer is equally expensive as parents need to pay for kids daycare or not work. Also the cost of air conditioning, public park maintenance such a mowing and trimming and vacations. Because of these costs, summer is arguably the same cost as winter for a citizen in Wisconsin.

    ReplyDelete
  8. Winter spending may increase spending in certain fields, but overall it may have more of negative impact on the US economy. In winter conditions, people are less likely to drive anywhere, after all no one wants to slip into a ditch because of black ice. Some states may have it better in the winter. Colorado, for example, will have an uptick in economic activity due to tourism for winter sports, but other states may not be as lucky.

    ReplyDelete
  9. Winter has both positives and negatives for because of winter. Some states are able to increase their revenue as they have tourism from skiing or other winter attractions. For example, Colorado has many tourists travel to visit the beautiful snow covered mountains as well as the great skiing terrain. However, there are other states, like you mentioned who suffer heavily from the unpredictable winter weather. Many states are often unprepared and when a winter storm hits, it costs more money, money that isn't canceled out with profits as in the winter, the profits are lower.

    ReplyDelete
  10. It is not that surprising how much money goes into winter supplies, especially if there is a lot of snowfall. Like you stated, Colorado is a large skiing and snowboarding spot that many people travel to during the winter, which all of their expenses goes towards the economy. It is crazy how much salt is needed just for New York, it makes you think about how much the total costs are for all of the country as well.

    ReplyDelete
  11. As it does snow in most U.S. states over the winter, it makes sense that the governments of each state spend millions on keeping road safe to drive on. It's quite easy to slide on ice while going way under the speed limit. Snow also does have its' up side in major industries like skiing and sledding, along with certain items only bought during the winter months, like jackets, hot chocolate, and hand warmers. Despite the downsides of snow each year, it is a great thing, not only for the economy, but the environment.

    ReplyDelete
  12. New Diet Taps into Revolutionary Plan to Help Dieters LOSE 15 Pounds in Only 21 Days!

    ReplyDelete

Related Posts Plugin for WordPress, Blogger...