Econsult Solutions, Inc. (ESI) was retained by the Downtown Partnership of Baltimore, the Waterfront Partnership of Baltimore, and Visit Baltimore to study the economic impact that panhandling has on the central business and entertainment districts of Baltimore City. Using standard industry input-output models, ESI conservatively estimated that $11 million was lost in revenue each year as a result of panhandling, $9 million was lost in contributions to the Gross Domestic Product, and one hundred jobs were lost with an expected loss of $2 million in earnings. Estimated annual losses to the city totaled $16 million.
Primary and secondary research estimated greater economic impacts to the city, increasing estimates to $66 million in lost revenue, $56 million in lost GDP contributions, 583 lost jobs, and nearly $13 million lost in earnings each year.
Using a survey of business owners in the Downtown Baltimore area, the study determined the industries most affected by panhandling were those related to leisure retail, restaurants, hotels, and attractions. Panhandling is a greater problem (more prominent and more frequent) in high traffic areas, particularly those that attract tourists. Further, panhandling appears to intensify when panhandlers need resources and enough people continue to supply resources to the panhandlers.
ESI recommended the City of Baltimore targets social services in the areas where panhandling is greatest to supply resources to those in need. Given the large costs and subsequent tarnishing of the City’s image due to panhandling, targeted social services to address this issue is justified.
