Trade Creates Jobs for Colorado

Transcription

1 Trade Creates Jobs for Colorado Creating and preserving quality U.S. jobs is a goal shared by all Americans. With 95 percent of the world s consumers living outside of the United States, it makes sense for small and large businesses to partner to build stronger trade ties with countries seeking U.S. goods and services. Trade creates jobs for Colorado. Export growth increases jobs by generating new business for Colorado s manufacturers, services providers and farmers. Imports support jobs and keep costs low, helping Colorado businesses compete and saving Colorado families real dollars at the cash register. Foreign investment in Colorado creates good jobs across a range of sectors. MORE THAN 1 IN 5 COLORADO JOBS DEPENDS ON TRADE Colorado workers need trade to maintain and create jobs. Today, 695,500 jobs in Colorado depend on trade. In 2008, 21.2 percent of jobs in Colorado depended on trade, up from 11.1 percent in Colorado s trade-related employment grew more than twice as fast as total employment from 2004 to Colorado Jobs Tied to Trade, 2008 Wholesale & Retail Trade 101,600 Prof., Sci., & Tech. Services 44,800 Finance & Insurance 37,900 Information 26,500 Transp. & Warehousing 22,700 Manufacturing 5,000 Small and Large Employers Partner to Export Small and medium-sized enterprises (SME) and workers in Colorado supply goods and services to large U.S. companies in and out of the State. Those bigger companies use the SME goods and services to make other products and services that they, in turn, export to customers around the world. Jobs in exporting plants pay on average up to 18 percent more than similar jobs in nonexporting plants. Newly exporting firms increase employment almost four times faster than non-exporting firms.

2 COLORADO S INDUSTRIES, SMALL BUSINESSES AND FARMERS GROW WITH EXPORTS According to the U.S. Department of Commerce, Colorado ranked 31 st in the United States with total exports valued at $7.7 billion in Computers & electronics was Colorado s leading export category in 2008 accounting for 34.4 percent of total exports. One of the fastest growing export categories for Colorado is chemicals, increasing at an average annual rate of 15.6 percent since In 2008, Colorado companies sold their products in nearly 200 foreign markets. The top export market is Canada ($2.2 billion). Other leading markets include Mexico ($961.1 million) and the Netherlands ($404.0 million). China is one of Colorado s fastest growing trading partners. In 2008, Colorado companies exported $508.2 million worth of goods to China, an increase of 232 percent since In 2008, exports accounted for approximately 3.1 percent of Colorado s state gross domestic product (state GDP). Services exports are also important to Colorado, including education of foreign students at state colleges and universities, and spending by foreign visitors to tourist destinations in Colorado, including the State s ski resorts and numerous national and state parks. Services companies employ 2.3 million workers in Colorado. In 2008, 530,600 Colorado services jobs depended on trade. Colorado is also an exporter of agricultural products. Leading markets are Canada, Mexico, the European Union, Indonesia, and the Philippines. The State is a leading exporter of wheat, live animals and meat, hides and skins, feed grains, and feeds. These exports directly benefit Colorado s farmers in northeastern Colorado.

3 COLORADO S SMALL AND MEDIUM BUSINESSES PARTNER WITH LARGE BUSINESSES TO EXPORT Exports particularly benefit workers at Colorado s small- and mid-size companies. In 2007, 3, percent of Colorado s exporting companies were small- or mid-sized companies. Larger Colorado companies are also important exporters. For the United States generally, half of U.S. exports are generated by U.S. multinationals. Small and medium-sized Colorado companies also indirectly export when they supply goods and services to larger Colorado exporters. Every job at a Colorado worldwide company supports nearly two others at companies that are part of its supply chain. Leading Colorado Exporters Company Products Foreign Markets Carestream Health (Windsor) Health imaging products Brazil, China, Germany Caridian (Lakewood) Medical equipment Belgium, France, UK Colorado Agricultural Services (Erie) Animal feed supplements Japan Denver Metals Co (Englewood) Non-ferrous metals China Leprino Foods (Denver) Frozen cheese, other food China, South Africa, India Luzenac America (Greenwood Village) Talc powder, inorganic chemicals Singapore, Indonesia MIG International Group (Boulder) Frozen pork, poultry products China, Hong Kong Nugget International (Greeley) Drysalted lambskins China, Russia Swift & Company (Greeley) Cattlehides, beef, pork products China, Taiwan Vietnam Windsor Shade Tobacco (Windsor Locks) Unmanufactured tobacco leaf Dominican Republic

4 MORE OF A GOOD THING FOR COLORADO TRADE AGREEMENTS LEVEL THE PLAYING FIELD The United States has some of the lowest trade barriers in the world. Trade agreements level the playing field by lowering other nations trade barriers and opening up foreign markets to U.S. exports. Colorado has increased its exports to partner countries following the implementation of the U.S. bilateral and regional free trade agreements (FTAs). Exports to North American Free Trade Agreement countries experienced the strongest growth, increasing by 306 percent since NAFTA s implementation. Since the U.S.-Chile Free Trade Agreement went into effect in 2004, Colorado s exports to Chile have increased by $23 million (245 percent). Since 2002, processed foods exports, Colorado s second largest export category, to FTA partners have increased more than twice as fast as processed foods exports to the world. While computers and electronics exports from Colorado to the world have decreased since the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) was passed in 2005, computers and electronics exports to DR-CAFTA countries have increased by 143 percent. The United States enjoys a trade surplus in manufactured goods with its FTA partners.* U.S. Trade Balance, 2008 Services Agricultural Products Manufactured Goods: 15 FTA Partners Oil Products Manufactured Goods: Other Countries $ billions * State-specific data are not available for imports, so this chart cannot be prepared for Colorado

5 FOREIGN INVESTMENT IN COLORADO CREATES JOBS Foreign-owned companies invest significant amounts of capital to open or expand facilities in Colorado every year. These companies employ 75,900 workers, 4 percent of all Colorado employees in the private sector. Foreign-owned manufacturing accounts for 14,500 jobs, representing nearly 10 percent of all manufacturing jobs in Colorado. U.S. subsidiaries of foreign companies pay an average compensation of $68,317 per year, 32 percent higher than U.S. companies. Selected Multinational Corporations Employing Workers in Colorado Company Industry Country BAE Systems Aerospace/Defense United Kingdom BP Energy United Kingdom Bridgestone Americas Rubber Products Japan HSBC Financial Services United Kingdom Nestle USA, Inc. Food Products Switzerland Oldcastle Inc. Building Products Ireland Roche Group Pharmaceuticals Switzerland Siemens Telecommunications Germany COLORADO COMPANIES AND WORKERS USE IMPORTS TO STAY COMPETITVE In 2008, 58.5 percent of the products we imported were used by U.S. workers to manufacture goods in the United States. Lower cost inputs keep U.S. manufacturing competitive in international markets. Imports frequently contain components (like cotton or semiconductors) and services (like design) sourced from U.S. farmers and companies, including companies in Colorado. Services, especially transportation, finance and insurance, marketing and legal services, are needed to bring imported goods to American manufacturers and households. These importing-related services industries are vital to Colorado s growth, and account for 45.5 percent of state GDP, more than seven times as much as manufacturing.

6 EXPORTS AND IMPORTS HELP COLORADO FAMILIES ENJOY A HIGHER STANDARD OF LIVING Exports and imports support family incomes. Jobs in exporting plants pay on average up to 18 percent more than similar jobs in nonexporting plants. Imports help keep prices for Colorado families down while increasing their choices for goods and services. Prices for imported consumer goods tend to drop year after year. Imports Keep Inflation Low ( ) Price Change Toys -45% Clothing -10% Household Appliances -9% Footwear -3% JOBS Trade and investment liberalization policies are worth over $10,000 per year to an average Colorado family of four. SOURCES Laura Baughman and Joseph Francois, Trade Partnership Worldwide, LLC ( U.S. Department of Labor ( U.S. Department of Commerce ( ( ( EXPORTS U.S. Department of Agriculture ( U.S. Department of Commerce ( ( ( ( Andrew B. Bernard, J. Bradford Jensen, and Peter K. Schott ( PIERS Trade Intelligence database ( FOREIGN INVESTMENT Organization for International Investment ( IMPORTS U.S. Department of Labor ( U.S. Department of Commerce ( STANDARD OF LIVING Council of Economic Advisers ( U.S. Department of Labor ( U.S. Department of Commerce ( TRADE LIBERALIZATION U.S. Department of Commerce ( Contact: David Thomas Director, Public Policy Business Roundtable dthomas@businessroundtable.org January 2010