Economic and Social Consequences of the Global Water Shortage

global water shortage

Nearly three-quarters of the surface of our planet is covered by water, and yet, by 2050, we won't have enough drinking water. Many parts of the world already experience acute water scarcity. According to the World Wildlife Fund, more than two-thirds of humanity may face water shortages by 2025. 

Our water deficit is the result of numerous factors, including overuse from agriculture, unethical privatization, and elevated global temperatures. At current consumption rates, it is not a question of whether we will run out of clean drinking water – the only uncertainty is pinpointing when that will happen. If we hope to mitigate water stress, we must understand the fundamental reasons that humans are overusing our most precious natural resource. Let’s explore some of the threats to our global water supply.

Privatization of Water

Access to clean, potable water is a basic human right. So why are so many people around the world struggling to access potable water, while corporations bottle billions of gallons every year? The answer is water privatization. 

A 2006 UN report blamed the water deficit on mismanagement, rather than insufficient supply. Sadly, the world water crisis is exacerbated by corporations seizing resources that were once free and available in developing countries. In regions where obtaining enough clean water may require a full day’s walk, private companies offer on-demand water storage and delivery—for a price. As transnational corporations score record profits, exploited locals are left to fight over whatever paltry resources they leave behind.

Water privatization is an underreported cause of water drought, and developed countries are not immune to its harmful effects. Corporations like Nestle, Coca-Cola, and PepsiCo are causing a water crisis in America. These massive corporations bottle tap water and upcharge consumers more than 2,000 times what they would pay if they filled up at the faucet. In 2017 alone, Nestle used over 58 million gallons from California’s water supply. 

Hand-in-hand with the depletion of this natural resource, water privatization (and bottling from larger corporations) also contribute to the plastic pollution epidemic that pollutes our waterways. Choosing a non-toxic reusable water bottle is an important way to support what our environment craves – sustainability.

Depleted Groundwater

Water shortages are not always obvious because most potable water is stored underground in subterranean aquifers. As severe droughts affect larger swathes of the planet, above-ground water sources like lakes, rivers, and snowpack are quickly shrinking. For instance, California now meets 60% of its water needs using groundwater.

Groundwater is an extremely finite resource. Historically, years with heavy precipitation contribute to a water surplus. During drought years, the aquifer shrinks—and the Western United States has been in an extended drought for over 20 years.

Earlier this year, federal authorities declared an official water shortage in the Colorado River. Water cuts will begin in 2022, but experts worry they will be insufficient to curb the continued depletion of our water supply. Worst of all, much of our precious water is not used for human consumption. Water is an important component in hydraulic fracturing also known as fracking—a process that involves injecting water underground at high pressure in order to access fossil fuels. A report from CERES, an organization that supports sustainable businesses, indicated that more than half of fracking operations occur in areas with severe drought. 

Water scarcity affects aquifers all over the world. Regions like the North China Plain, Northern India, and the Middle East are staving off their own water shortages.

The Climate Crisis

Scientists began warning of the consequences of climate change back in the 1970s. Since then, climate models have become more accurate and communities around the world have experienced extreme weather with greater frequency and intensity.

Although climate change is often framed as a partisan issue, its devastating effects give no credence to belief or political orientation. Even conservative models predict a world water crisis in the next several decades, which may catalyze a humanitarian emergency of catastrophic proportions.

According to UNICEF, roughly 74% of natural disasters between 2001 and 2018 were water-related. These events, including droughts and floods, are expected to increase exponentially as the atmosphere heats. Tragically, the redistribution of water around the globe leads to scarcity among the world’s most vulnerable populations, especially children. 

Already, 450 million children lack access to clean drinking water and 750 die every day due to water stress. Even when freshwater exists, climate change contributes to contamination and water-borne illnesses.

Disrepair and Mismanagement of Water Infrastructure

Aging water infrastructure around the world is failing. Almost 200,000 people were evacuated in Northern California in 2017 after both a dam spillway and a secondary emergency spillway failed, creating outflows of 100,000 cubic feet per second. Freeways jammed with panicked families as flooding threatened their homes.

Even in the United States, there are still in excess of six million lead water pipes in use today. Flint, Michigan, made headlines in 2014 when between 6,000 and 12,000 children were needlessly exposed to lead in their drinking water. But this issue is more widespread than we realize. Water transportation infrastructure, treatment plants, leaky pipes, and sewer systems are all aging, with no contingency plan to replace them when they fail. Without a major investment in reliable water storage, populations around the world will experience acute water stress. 

Wasted Water

According to the EPA, the average American family can waste 180 gallons of water per week, or almost 10,000 gallons annually. Every year, household leaks lead to the loss of 900 billion gallons of water in the United States alone. 

The suburban fixation with lush, green lawns is a major source of water waste in arid climates. In certain parts of the world, natural precipitation is sufficient to keep lawns green and healthy. But in water-stressed areas like the American West, household irrigation wastes billions of gallons of water. Watering the average lawn just 20 minutes a day for seven days is equivalent to taking 800 showers. Households regularly lose more than 50% of their water to wind, evaporation, and runoff caused by inefficient irrigation methods. But this pales in comparison to the water scarcity caused by agriculture.

According to The Water Project, agriculture accounts for more than 70% of global water withdrawals. Inefficient irrigation systems and wasteful practices like flood irrigation contribute to unnecessary waste. In the case of flood irrigation, only 20% of water is actually utilized by crops. The practice increases the risk of soil erosion, subjects crops to water-borne diseases, and increases the cost of cultivation. Although many people rely on this traditional form of agriculture, governments around the world are taking measures to reduce the use of flood irrigation.

world water crisis

Economic Consequences of Water Scarcity

Historically, water scarcity has been relegated to the discourse of academics, environmentalists, and humanitarians. But in recent years, even big businesses are acknowledging the adverse economic consequences of a world water crisis. Both developed and developing countries have an ethical and financial incentive to solve this issue. 

In countries like Liberia, Somalia, and Guinea-Bissau, agriculture makes up more than 50% of the total GDP. A single severe drought could imperil the economy of these already at-risk countries. Even in a high-income state like California, which derives almost 50 billion dollars a year from agriculture, continued drought could lead to increased poverty and malnutrition.

Companies like Foxconn and Coca-Cola are already using the availability of water as a leading criterion for relocating their operations. The water crisis in America has pushed a growing number of businesses to reincorporate in the Great Lakes region, where freshwater is more plentiful. This leads to the loss of jobs and economic depression in areas that are already suffering from drought. 

For example, the infamously poor water quality in Flint led businesses to leave in droves. The result has been a negative feedback loop for residents, who suffer because companies still avoid the community to this day.

As climate change triggers the largest refugee crisis in human history, migrants will flood into neighboring countries, straining their economic systems. Countries like the Marshall Islands are already reeling from flooding and sea-level rise. As its residents relocate, the world will need to adapt in real-time. 

Both local economies and international markets bear the risk of climate change. Depleted local water supplies can shock regional economies, ultimately creating global supply chain issues. For instance, sectors like energy, transportation, and manufacturing are heavily reliant on water. A water drought can lead to rolling blackouts, which in turn disrupts the industry. A region experiencing water stress will typically experience a concurrent economic decline. 

Many localities around the world depend on hydropower for energy. When areas like the Colorado River Basin and the Indus Basin run dry, the surrounding areas will experience energy-stress for household and commercial use. 

Some governments have turned to imported water to meet their agricultural and industrial needs—as when Israel bought 50 billion liters of water from Turkey in 2003. But the gains were short-lived for Israel and their ongoing misuse of water led to a deficit in both countries. 

The World Bank, despite being complicit in much of the world’s water privatization, reported in 2016 that “Water scarcity, exacerbated by climate change, could cost some regions up to 6% of their GDP, spur migration, and spark conflict.”

Social Consequences of Water Scarcity

Elevated food and water prices will exacerbate humanitarian crises as more and more people strive to find clean drinking water. Regional conflicts will devolve, perhaps sparking the long-prophesied “Water Wars.” Without sufficient water, livestock will diminish and crop yields will plummet. The ensuing food shortages will contribute to unrest in some form.


Numerous studies reveal an unambiguous link between climate change, drought, and the Syrian civil war. Although the harrowing war is the result of numerous geopolitical interests, drought played a partial role.  The “Five Year Drought” lasted from 2006 to 2010 and more than 800,000 working class Syrians lost both their livelihood and consistent access to drinking water. Farmers and herders bore the brunt of the water deficit, displacing at least 50,000 families as they searched in vain for adequate water to sustain their crops and livestock. Most displaced Syrians relocated to already-strained urban centers and shantytowns where they competed for scarce resources.

This desperation set the stage for a series of protests, beginning in March 2011. Initially, these peaceful protests decried the government of Bashar Al-Assad and its inability to meet the basic human rights of its citizens. Al-Assad’s repression of these protests escalated the conflict into a civil war. It’s also important to mention that the conflict was greatly intensified by world powers—like the United States, Iran, and Russia—waging a proxy war in the region.

We will never know exactly how the civil war would have played out without climate change. But the role of environmental degradation is decidedly underappreciated. And as the multi-pronged threats of war, famine, and climate-induced drought drove Syrians from their homes in large numbers—surrounding nations absorbed them and confronted their own water scarcity issues. With well over one million Syrian refugees living in neighboring Lebanon, food and water shortages lead to sectarian violence. 


India faces a similar water crisis due to government corruption, corporate privatization, industrial overuse, and a lack of sanitation services. Some 21% of India’s diseases can be traced back to water sanitation and 33% of the population lacks access to clean water. In a country with such a staggeringly large population, continued water drought may displace millions of people. The World Bank and private companies like Radius Water Limited conspired to commodify India’s dwindling freshwater supply in the 1990s and triggered a long-standing water deficit. As multinational corporations make record profits, India’s rivers are drying up and freshwater sources remain polluted. 

Clean water is in short supply, forcing farmers to use untreated wastewater to irrigate their crops. The toxic water contaminates the produce, passing harmful chemicals and sewage into the food supply. With a population of 1.3 billion people, drought-induced mass migration from India would overwhelm surrounding countries and exacerbate ongoing tensions with nations like Pakistan and Bangladesh. A single Indian water basin might provide for 15-20 million people. If even a single basin dries up, its dependents would be cast into neighboring regions in search of clean water. Without access to clean water, our societies cannot function and violence inevitably ensues. 

The Water Shortage’s Impacts on Food Production

Every stage of agriculture is dependent on water. Produce, livestock, and grains all require water to thrive and yield. Droughts will continue to threaten farmland and livelihoods around the world. 

This is already happening in Yemen, where water riots erupted in 2009 and unrest continues to this day. Experts blame water scarcity as a contributing factor for destabilizing Syria. Not surprisingly, climate change and water mismanagement contribute to reduced harvests, famine, and stress on local communities. This unfortunate narrative is spreading rapidly across the Middle East.

How to do Your Part

If you’re discouraged and overwhelmed by the water crisis, don’t worry—you’re not alone. There are a number of ways to stave off the worst water shortage scenarios.

Conserve Water in Your Home

Minor behavioral changes make a large impact over an extended period of time. Opt for showers instead of baths. Turn off the faucet while brushing your teeth and washing dishes. Rinse your razor in the sink. Switch to low-flow toilets and showerheads. Buy Energy Star appliances like washers and dishwashers to reduce water waste.

If you’re gardening, consider native plants that require less water. Use greywater from sinks, showers and laundry to water your plants (assuming you don’t use harmful chemicals). If you have a lawn, especially if you live in a dry environment, consider converting all or part of your lawn into a xeriscaped garden. Position sprinklers so they don’t waste water on the sidewalk. Better yet, set up a drip irrigation system

Support Local Agriculture

Keep the water within your community. By eating produce that was grown from your own watershed, you prevent the displacement of water from your local aquifer. Start a backyard garden or visit your local farmers market. Join a CSA and find a local farm that focuses on organic, regenerative agriculture. By reducing pesticide use, farmers can maintain soil health—which improves the retention of both nutrients and water. If you’re open to a dietary change, consider eating fewer animal products.

Reduce Your Use of Fossil Fuels

Fossil fuels’ adverse effects on the water crisis are twofold. First, the average barrel of oil is a water hog, requiring 468 gallons of water to refine. Second, once this oil is combusted, it releases greenhouse gases into the atmosphere, which intensifies drought and extreme weather patterns.

If everyone reduced their fossil fuel footprint, it would dramatically improve the world water crisis. Install solar panels on your home. Join a solar garden if you rent your property. Switch to an all-electric or hybrid vehicle. Unplug appliances when leaving the house for long periods. Support local initiatives for bike paths, charging stations, and utility-scale renewable installations.

If we do our part, there is hope for a brighter future.

Avoid Plastic 

The term “fossil fuels” is a misnomer, because it implies that climate-destabilizing hydrocarbons are only used for energy. In fact, petroleum is the primary ingredient found in everything from clothes to plastic bags. Approximately 8 to 10% of the global oil supply goes to plastic.

Although it may seem unrelated, refusing plastic bags when you shop, buying clothes made from organic materials, and drinking from a reusable water bottle - like non-toxic borosilicate glass - will ultimately curtail the climate crisis—and ameliorate water scarcity in the process.

Use Recycled Paper Products

Toilet paper is responsible for 15% of total deforestation on Earth. America uses 437 billion gallons of water and 15 million trees in the form of toilet paper every year. Include other paper products like paper towels, napkins and paper bags, and the amount of water and trees consumed is staggering. The Natural Resources Defense Council ranks paper products based on their wastefulness and most major brands, like Charmin, Cottonelle, and Kirkland, received an F. Luckily, there are many options, like recycled paper products and tree-free toilet paper, that can drastically reduce water usage.

Support Conservation Efforts

Are there organizations in your area working to protect your watershed? Joining like-minded individuals to conserve your local habitat is a rewarding way to fight back. Find out if your local water supply is privatized. Support efforts to nationalize your water utility.  

If you’re short on time, consider donating to an organization that advocates for water rights. Even a small monthly contribution to nonprofits like Food & Water Watch, Blue Communities, and Sierra Club can have a huge impact. Buy bunds (small pits that capture rainwater) through Justdiggit to reverse desertification in Africa. But do your homework before donating. For example, several large charities, like The Nature Conservancy, are funded by big businesses and actively promote water privatization

Share Information with Friends and Family

Water scarcity has been at the forefront of environmental discourse for decades, yet the average person is uninformed about water privatization and water drought. Have conversations with family and friends. Share documentaries like Blue Gold and send relevant articles to interested parties. Educate yourself about the devastating impacts of plastic waste, find healthier alternatives to plastic water vessels and companies that promote a more sustainable future. Learn about your watershed and help educate others. 

Understand Your Role in the Global System

The aphorism “think globally, act locally” has never been more relevant. By engaging with our communities, our collective actions can influence global change.

The time for inaction has long since passed. Empower yourself to protect our planet’s most valuable resource and fight back against the epidemic afflictions of climate change, depleted groundwater, and water privatization. Seemingly insurmountable problems breed apathy and inertia. But with collective action and unrelenting will, an equitable, thriving world is within reach. Don’t be intimidated. Millions of people around the world are already fighting for water justice. Will you join them?