Jobs and export data highlight importance of US scrap industry

The Institute of Scrap Recycling Industries, Inc, (ISRI) released a summary of a recent study that highlights the nearly 460,000 United States jobs supported by America’s scrap recycling industry as well as new data that underscores the critical role United States exports play in employing workers in the United States.

Additionally, recently released data confirm that the United States scrap supply is more than ample to meet demand at home, as evidenced by solid increases in both domestic and overseas scrap shipments.

The executive summary – prepared by John Dunham and Associates – confirmed that the American scrap recycling industry plays a prominent role as an economic leader, job creator and major exporter. In fact, the people and firms that purchase, process and broker old materials to be manufactured into new products in America provide 459,140 adults with good jobs in the United States and generate $90.1 billion in economic activity.

Regarding exports, the summary based on the study illustrated that in 2011, 51,768 jobs were directly supported by the export activities associated with the processing and brokerage operations of scrap recyclers operating in the United States. An additional 110,163 jobs are supported by supplier operations and through the indirect effects of scrap recycling exports. These jobs pay a total of $5.8 billion in wages. All of this export activity generates $30.7 billion in economic benefits in the United States and contributes $2.1 billion in tax revenues for the federal government and $1.5 billion in state and local taxes.

“America Recycles Day is a great opportunity to educate people about just how significant the United States scrap recycling industry truly is,” said Joe Pickard, ISRI chief economist and director of commodities. “Our industry is putting United States employees and resources to work every day and supplying needed resources to industrial consumers throughout the United States and around the world.”

Commenting on recent proposals to limit scrap exports, Pickard added, “Any idea that protectionist measures such as limiting exports are somehow going to increase economic growth and job creation has no sound basis in either economic theory or reality. Restricting exports in order to promote growth is something like eliminating food in order to promote good health – eventually it starves the patient.”

To highlight America Recycles Day, ISRI compiled the following data from government sources, demonstrating the recycling industry’s activities in furtherance of the Obama Administration’s efforts at increasing United States exports to spur economic growth:

•Overseas demand for American scrap has surged in recent years. From 2000 to 2010, total United States scrap exports jumped from 17.7 million mt to more than 45 million mt. Over the same period, the value of those shipments increased more than 6-fold from $4.8 billion to $29.6 billion last year, breaking the prior record of $29.1 billion set in 2008.

•United States scrap exports through just the first 9 months of 2011 have already reached $29.9 billion, according to the latest figures from the Census Bureau, already surpassing last year’s record and representing a 41 percent increase over January through September 2010 exports.

•The increased year-to-date export sales reflect this year’s generally higher price levels, as well as increased physical demand, as the total volume of loadings during January to September 2011 advanced 20 percent from last year to reach 39.5 million mt.

•By destination, the largest overseas markets for United States scrap this year include: China $8.7 billion (+42percent); Canada $2.8 billion (+27 percent); Turkey $1.9 billion (+80 percent), South Korea $1.7 billion (+34 percent); and Taiwan $1.4 billion (+46 percent).

•By commodity, the value of YTD date shipments are up significantly for each major commodity group including: aluminum scrap $3.1 billion (+34 percent); copper scrap $3.9 billion (+54 percent), ferrous scrap $8.15 billion (+52 percent), recovered paper and fiber $2.9 billion (+19 percent) and plastic scrap $788 million (+16 percent).

Pickard also noted that according to recent federal government data, total domestic consumption of ferrous scrap during January through August 2011 reached 36.9 million mt, up from 34.0 million mt during January through August 2010. Meanwhile, January through September 2011 trade data from the U.S. Census Bureau show the volume of YTD ferrous scrap exports increased more than 30 percent to 18.4 million mt, clearly demonstrating that the United States scrap supply is able to simultaneously meet increasing scrap demand both at home and abroad.