Economic Impacts of Fire

Wildfire activity in the United States incurs substantial costs and losses, and presents challenges to federal, state, tribal and local agencies that have responsibility for wildfire management. Beyond the potential socioeconomic and ecological losses, and the monetary costs to taxpayers due to suppression, wildfire management is a dangerous occupation.

Over 1200 post-fire assessment and treatment implementation reports from four decades (1970s–2000s) of western US forest fires have been examined to identify decadal patterns in fire characteristics and the justifications and expenditures for the post-fire treatments.

The Dry Forest Investment Zone (DFIZ) is a five-year project to address common natural resource-based economic development challenges through increased networking and capacity building at a regional scale.

We examined the effect of large wildfires on economic growth and volatility in the western United States. We matched wildfire data with quarterly employment and earnings growth data to assess the specific effect of wildfire on employment and wage growth in western US counties.

Where a legacy of aggressive wildland fire suppression has left forests in need of fuel reduction, allowing wildland fire to burn may provide fuel treatment benefits, thereby reducing suppression costs from subsequent fires. The least-cost-plus-net-value-change model of wildland fire economics includes benefits of wildfire in a framework for evaluating suppression options.

Contracting capacity and local capture can be the result of local economic conditions (supply side conditions) as well as agency contracting practices (demand side conditions). In order to capture contracts locally, local businesses that can perform the work need to exist, and past experience contracting with the federal government is a reasonable indicator of that capacity.

Although fire managers, policymakers, and communities are benefiting from better understanding of suppression costs, property losses, and community impacts of large fires,4 no generalizable empirical research has quantified the specific effect of large wildfires on local employment and wages.

The purpose of this report is to shed light on fire suppression spending as a starting point for understanding the economic impacts of large fires.

The purpose of this report is to propose principles and strategies for creating socioeconomic performance measures, as well as identify potential measures that could be integrated into the WCF and other restoration frameworks in the short term.