New economic impact study shows continued strength of US aluminum industry

A new study released on April 20 shows the continued importance of the U.S. aluminum industry to the national economy. Research conducted by economic research firm John Dunham & Associates found that the domestic aluminum industry directly employs nearly 161,000 workers and contributes more than $75 billion to the national economy. When supplier and induced impacts are taken into consideration, the industry is responsible for nearly 713,000 jobs and $186 billion in economic impact – more than 1 percent of national GDP.

According to the report, while certain segments of the domestic aluminum industry have struggled in recent years – with major job losses particularly in the upstream segment of the business – these losses have been offset by gains in downstream sectors like flat-roll products, extruded products and foundries. Demand growth for the metal has continued including a near doubling of aluminum shipments to the transportation sector since 2009. In total, direct jobs supported by the U.S. aluminum industry ticked upward slightly from the 2013 report – from roughly 157,000 to nearly 161,000 jobs.

“This report shows is the continued resilience of the domestic aluminum industry and its importance to the U.S. economy,” said Garney Scott, President & CEO of Scepter and Chairman of the Aluminum Association. “But clearly, some segments of the U.S. aluminum industry are navigating through extremely challenging times right now and we’re committed to addressing these challenges.”

Other key findings in the report include:
• Workers directly employed by the U.S. aluminum industry earn more than $12 billion in wages and benefits.
• Indirect employment creates an additional $34 billion in wages and benefits.
• When all employment supported by the industry is taken into account, these jobs generate more than $18 billion in federal, state and local taxes.

“While we’re pleased to see the net growth in our industry’s jobs footprint, it’s important not to lose sight of the significant job losses we’ve seen in certain segments which is largely a consequence of overproduction of aluminum in China,” said Heidi Brock, President & CEO of the Aluminum Association. “In less than three years, nearly 60 percent of our industry’s domestic alumina refining and primary aluminum smelting jobs have disappeared.”

The Aluminum Association has been working to highlight the economic consequences of unsustainable aluminum production practices in China which have forced the closure or curtailment of eight U.S. aluminum smelters since the beginning of 2015.

The 2016 Economic Impact of the Aluminum Industry study was completed by economic research firm John Dunham & Associates and is based on data provided by Dun & Bradstreet, Inc., the federal government and the Aluminum Association. The analysis uses the Minnesota IMPLAN Model to quantify the economic impact of the aluminum industry on the overall U.S. economy.

For the purposes of the report, the aluminum industry is defined to include alumina refining; primary aluminum smelting; secondary aluminum production; manufacturing of aluminum sheet, plate, foil, extrusions, forgings, coatings, and powder; aluminum foundries; metals service centers, and wholesalers. The study measures the number of jobs in this industry, the wages paid to employees, total economic output and federal and state business taxes generated.

The complete study, including an interactive map with economic contribution breakdowns by state and congressional district, is available at http://www.aluminum.org/economy.