Economic Impact of Recycling

October 8, 2013

Today’s Guest Blog is by Dave Fusselman, owner of Fusselman Salvage Co., a metal recycling center in Moberly, Missouri.

Every pound of recyclable material that escapes the trash bin is important – those pounds combine to create $87 billion in economic activity each year in the United States. When one thinks of recycling, the main benefit that comes to mind is decreasing environmental impacts and cutting down on natural resources, but it does way much more. Recycling creates jobs, societal benefits and overall improves the economy.

Creates Jobs

According to a study commissioned by the Institute of Scrap Recycling Industries, nearly 463,000 jobs are provided in the USA thanks to the recycling of metals, electronics, plastics, paper, rubber, glass and textiles. Out of these jobs, direct employment comes to just under 29.8% (138,000 jobs), supplier jobs come to about 28.5% (132,000 jobs) and induced jobs represents 41.7% (193,000 jobs) of all the available jobs from this study. In addition, the amount of recycling jobs in the U.S. is looking to increase by about 10% over the next 5 years.

Benefits Government Services

In addition to boosting employment rates and job opportunities, recycling generates tax revenues to support government services, such as transportation, public health and safety, and social services programs. The study conducted by John Dunham and Associates estimated recycling companies and their employees pay nearly $4 billion in state and local taxes plus $6.3 billion in federal taxes each year.

Improves Imports/Exports

Recycling also helps the country’s import/export balance, with scrap commodities being among the nation’s largest exports by value.  About 39% of the recycling industry’s economic activity comes from exporting. Dunham and Associates pointed out that international trade is an integral part of the U.S. economy, with nearly $2.2 trillion in total goods and services exported from the USA in 2012.

The Dunham study found that scrap exports netted $27.8 billion in sales in 2012, generating $33.9 billion in total economic benefits that include $1.9 billion in federal tax revenue and $1.6 billion in state and local taxes.

Scrap commodities are raw materials that are used in the creation of new products, much like coal, corn and cotton are transformed into energy, ethanol, and clothing, respectively.  The United States, due to its prosperity and high consumption, generates a lot more scrap material per capita than other countries, so it has a surplus that can be sold overseas and used to produce goods for consumption in those countries.

Expands Local Employer Opportunities

By gathering recyclable materials and placing them back into local markets, local employers have greater opportunities to expand with their operations. Recycled materials give companies a better chance for survival because it helps their local economy and provides cheaper resources for them. One notable benefit from purchasing these materials is the improved transportation from recycling tax revenue, so these businesses can have greater efficiency and less vehicle degradation, which improves operations and cuts costs.

An Economic Driver

ISRI President Robin Wiener pointed out that the Dunham study shows how the scrap metal recycling industry serves as an economic driver for the United States, creating jobs and export revenue.  “At a time when the national job market is fragile, the recycling industry is creating high-quality, good-paying opportunities for Americans.  This in turn feeds money back into the economy through spending and revenue generated from taxes,” she said.

Dave Fusselman is the owner of Fusselman Salvage Co., a metal recycling center in Moberly, Missouri. Fusselman Salvage is a go-to metal recycling provider throughout north-central Missouri, serving cities, such as Macon, Kirksville, Hannibal, Mexico, Jefferson City, Columbia and Boonville.

NERC welcomes Guest Blog submissions. To inquire about submitting an article contact Athena Lee Bradley, Projects Manager. Disclaimer: Guest Blog’s represent the opinion of the writer and may not reflect the policy or position of the Northeast Recycling Council, Inc.