Public Investments in Water Conservation Stimulates Economic Activity

Public investments in water conservation and efficiency have large economic and job creation impacts

Public investments in water conservation and water efficiency stimulate economic activity that is twice as great as the initial investment. One person-year of employment is created for each $72,400 that is invested.

The Economic Roundtable studied over $1.2 billion of investments in recent water-use-efficiency projects in the Los Angeles area – including a sample of 53 recent local stormwater, water conservation, graywater, recycled water, groundwater management and remediation projects – to find how they affect the local economy. The results were released today in a new report, Economic and Job Impacts of Investments in Water Use Efficiency.

The ratio of jobs stimulated for every $1million invested is comparable to energy efficiency retrofitting, and higher than many traditional Los Angeles industries such as motion picture production and new home construction.

Paula Daniels, Mayor Villaraigosa’s senior advisor on food and water policy, said “This study shows that investment in local water use efficiency projects is as important for the local economy as it is for water quality.”

Los Angeles is the most populous region of California, with average daily water use of 135 gallons per person – 49,275 gallons per person annually. Population growth and demands from other regions for an increasing share of the water that has traditionally come to Los Angeles is making it increasingly difficult and expensive for Los Angeles to import enough water to meet local demand.

Periodic droughts and the high costs of importing water from the Sacramento Delta and Colorado River Basin make the need to achieve greater water use efficiency even more urgent.

“More investment in LA County can help local businesses grow and build competitive strength in water conservation, ground water treatment or recharge, and water recycling services and technologies,” according to Gil Crozes, vice president of Carollo Engineers.

Mark Gold, president of Heal the Bay, said, “This study demonstrates that investment in green water jobs provides major economic benefits. This finding should remove all barriers to increased investments in conservation, recycling and rainwater capture – all of which would greatly augment local, reliable water supplies while improving water quality.”

The study investigated the jobs that investments in water use efficiency open up for local workers. For every $1 million dollars invested, 12.6 to 16.6 annualized jobs are created, depending on the type of project. These local jobs impacts are comparable to those stimulated through energy efficiency retrofits of commercial buildings (13.6 per $1 million), and higher than construction of new housing (11.3 per $1 million) and motion picture production (8.3 per $1 million).

According to Patrick Burns, senior researcher at the Economic Roundtable, “locating new water sources is difficult. Los Angeles needs to use the water it has more efficiently, and a dividend from doing this is that we will open doors for job seekers, including young adults eager to gain skills in the emerging field of water use efficiency.”

Findings from the Economic Roundtable’s study indicate that there are much greater local benefits from investing in local water use efficiency projects than from equivalent investments in massive statewide projects. Local investments not only produce large multiplier effects in the local economy where water users live and work, but also by encouraging conservation of this increasingly scarce resource.

“The strong local multiplier effects of water use efficiency investments are further reason for increasing local investments in water recycling and other water efficiency projects, as well as for supporting state bond measures that can leverage our local funding,” stated Sharon Green, Legislative & Regulatory Liaison at the Sanitation Districts of Los Angeles County.

Gregory Irish, executive director of Los Angeles’ Workforce Investment Board (WIB), sees a role for local government to facilitate employment opportunities. “The City can work with the community college district to establish targeted workforce training and uniform certification programs for emerging occupations in water use efficiency.”

The report, Economic and Job Impacts of Investments in Water Use Efficiency, can be downloaded at

Economic Roundtable The Economic Roundtable is a non-profit, public benefit research organization formed in 1991 to provide practical knowledge about how communities can become more sustainable.

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