An Analysis of Impacts of Imported Iron and Steel on US Economy

SEATTLE (Scrap Monster): In 2016 there were 83,952 direct, induced and indirect jobs in the United States generated by imported iron and steel products moving via the nation’s seaports. Of the 83,952 jobs, 26,432 jobs are directly generated by the imported iron and steel cargo and related vessel activity. As the result of local and national purchases by those 26,432 individuals holding the direct jobs, an additional 33,182 induced jobs were supported in the national economy. In addition, as the result of $1.9 billion of purchases by businesses supplying the direct services at the marine terminals, and by businesses dependent upon the imported iron and steel products and vessel activity, 24,338 indirect jobs were created in the national economy. An additional 1.2 million jobs are with related importers and users of the imported iron and steel products moving through the nation’s seaports.

In 2016, imported iron and steel activity supported $239.8 billion of total economic activity, accounting for 1.3% of the nation’s $18.9 trillion Gross Domestic Product in 2016. Of this $239.8 billion, $4.2 billion accounts for direct business revenue that was received by the firms that provide services to the imported iron and steel cargo and associated vessels calling at the nation’s seaports. From this $4.2 billion of direct business revenue, the firms use a portion, $1.4 billion, to pay the salaries of 26,432 direct job holders. This equates to an average annual income of $53,796. In addition to the direct salary paid from the $4.2 billion of direct business revenue, the firms providing the direct services also make purchases for goods and services, totaling about $1.9 billion.

Another component of the $239.8 billion economic activity is the re-spending effect that occurs due to consumption purchases by the direct jobs holders. This is not included in the direct business revenue as it occurs from the portion of the direct income that is used by individuals for purchases of goods and services.

In 2016, the re-spending and local consumption impact generated by the imported iron and steel products is estimated at $4.8 billion. The remaining $230.7 billion represents the value of the output to the national economy with users of the imported iron and steel products moving via the U.S. ports. This includes the value added at each stage of production for the firms and industries using imported iron and steel products that flow via the marine terminals.

A total of $19.4 billion of federal, state, and local taxes were supported by the imported iron and steel products handled at the nation’s ports in 2016, including $2.3 billion of direct, induced and indirect federal, state and local tax revenue, and an additional $17.1billion of federal, state and local tax revenue created as a result of the economic activity of the importers using the imported steel that passed through the nation’s marine transportation system.

Courtesy: AIIS