Oil Spill Could Further Paralyze Florida Economy

No one wants to visit beaches where oil mingles with the seashells in the surf. That's why Florida is desperately hoping the recent spill in the Gulf of Mexico can be contained. The state needs its tourism industry to recover.

Florida had enjoyed seemingly unencumbered prosperity thanks to its real estate boom. But like the rest of the country, that all ended a few years ago when the housing market sobered up. Since then, the state's economy has struggled. It's ranked fifth-worst in unemployment, hitting 12.3% in March.

According to the Palm Beach Post, the Gulf Stream may help to coat much of Florida's coast with oil. That would contaminate its most valuable natural resource: its beaches that draw tourists from around the world. Here's a diagram the article provides:

Fla oil slick 2010-05.jpg

As you can see, the northwest coastal areas, including Tampa, are already in a state of emergency. But the current is expected to sweep the oil to the Keys and most of its southeast coast as well. These beaches that would be affected account for most of the state's tourist destinations, with the notable exception of the Disney and Universal theme parks located further inland in the Orlando area.

It's hard to overemphasize how serious a problem it would be for Florida if its tourism doesn't return as the U.S. economy improves. With its real estate market unlikely to thrive again for years, the state doesn't have many other business sectors to rely on, other than tourism and farming.

Even if people do start vacationing there at a rate seen before the recession, the job growth that results probably won't be enough to completely staunch the staggering number of unemployed in the state. If that job creation is delayed until the oil clears, then many of those currently looking for work may still be searching years from now. Of course, the state's poor housing market also makes labor mobility more difficult, though some residents have already begun fleeing the state for better opportunities elsewhere.

At this point, Floridians are still hoping that the spill can be contained and its coast spared. But if efforts to prevent the spread of the oil fail, then tourists may think twice about choosing Florida as their tropical vacation destination for some time. And that would be crippling to the state's economy, which needs tourism to return to experience even a slow recovery.