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Quantifying Economic Benefits

NOAA By the Numbers

See statistics of research at NOAA that measure economic benefits of our programs, or indicate how NOAA programs create economic value.

NOAA's Mission & Economic Role

Value Creation Through Critical Research

NOAA's Mission is to understand and predict changes in climate, weather, oceans, and coasts, to share that knowledge and information with others, and to conserve and manage coastal and marine ecosystems and resources.”

-NOAA Mission & Vision

In fulfilling NOAA’s mission, the agency’s programs create significant economic value. NOAA’s research and forecasts lead to reduced damage from storms and other natural hazards. The Agency provides information that helps businesses make decisions and allows key industries like like marine transportation, commercial fisheries, and agriculture to operate more efficiently. NOAA’s management programs for oceans and coastal areas help enhance both the current and future productivity of the economically vital resources in these areas.
 

It is not possible to distill all of NOAA’s economic impacts to the nation — and the world — into a single number. So NOAA By the Numbers presents a collection of statistics which highlight the impact of select NOAA products and information. These statistics are organized by thematic areas from weather data and information to natural resource management.

 

How NOAA Contributes to the U.S. Economy

NOAA contributes value to the economy in two fundamental ways. First, by providing information to guide or influence decisions; and second, by managing, or helping to manage, natural resources that are themselves valuable. Understanding the economic benefits created by NOAA involves determining how people use/value the information that NOAA provides, and/or how the value of resources are enhanced through NOAA management.

Operational Information

Much of the information created by NOAA is “operational” in nature, including the full range of weather information together with ocean conditions and forecast information. Such information is valuable because people, businesses, academia, and governments use it regularly to improve decision making. They use it to make critical decisions about preparing for storms, such as future electricity demands as well as to make individual decisions about personal plans. Operational information is valuable when it is accurate and timely. Accuracy means the information is correctly presented and predicted. Timeliness means that the information gets to people and organizations in a timely manner to ensure appropriate responses. The value of operational information lies in the use of information to improve economic, social, and other societal outcomes. Thus, the value of information also depends on:
  • The ability to use information to make a better decision (regardless of the preciseness or timeliness, information only has value if an individual is able to act);
  • The perceptions of the users (do they trust the information enough and have the ability to act upon the information); and,
  • The potential economic and/or societal gain or loss resulting from a good or bad decision.
Storm forecasts are one example of the operational information NOAA provides. The forecasts enable people to respond in ways that limit the costs of storms. To measure this type of value, economists try to assess the damage to life and property that could result from storms and to assess how information coupled with changes in behavior reduces those damages. This damage reduction is the value created by the information. Important examples of storm forecasts include tornado and hurricane warnings. Such warnings have huge impacts on morbidity and mortality effects, both of which are reduced by proactive evacuations and sheltering in place. In the case of hurricane warnings, an accurate forecast makes it possible to target the hurricane evacuation zone correctly and gives sufficient time to allow the evacuation to be safe and orderly. This is important because evacuations can be costly, but the failure to evacuate or seek shelter may have greater consequences. Read more about hurricanes here.

Resource Management Activities

In cooperation with other federal agencies and with state and local governments, NOAA assists in the management of the diverse and complex human and natural ecosystems of the U.S. coastal areas, including the Great Lakes and rivers. NOAA’s stewardship enhances the benefits that these natural resources provide, but it involves dealing with complex tradeoffs among competing resource uses by using state of the art environmental information and decision support tools.

For example, NOAA policies mitigate the decline of vital fish stocks by prioritizing long-term fishery health over immediate extraction value, ensuring that the short-term economic trade-offs result in a more resilient industry and a stable seafood supply for consumers.

Read more about how NOAA manages coastal waters and the economic benefits of coastal management here, and visit the other thematic areas to learn how NOAA natural resource management helps preserve our resources and improve the American economy.

Topics Pages

View our Topics pages to see how NOAA contributes to each major area of the economy through it’s research.