2018 Economic Impact Studies In Partnership with An Economic Analysis of the U.S. Wooden Railway Tie Industry A Report Prepared for the Railway Tie Association October 22, 2018 An Economic Analysis of the U.S. Wooden Railway Tie Industry For more information about the report, please contact: Chad Moutray, Ph.D., CBE NAM Chief Economist and Director Center for Manufacturing Research (202) 637-3148 [email protected] The Center for Manufacturing Research in Partnership with: Inforum www.inforum.umd.edu Prepared for: Railway Tie Association 115 Commerce Drive, Suite C Fayetteville, GA 30214 Blank Page An Economic Analysis of the U.S. Wooden Railway Tie Industry Table of Contents Abbreviations ...............................................................................................................................................iii List of Tables ................................................................................................................................................. iv List of Figures ................................................................................................................................................ iv Executive Summary ..................................................................................................................................... 1 1. Introduction ........................................................................................................................................... 5 2. Industry Overview ................................................................................................................................. 6 2.1 Output ................................................................................................................................................. 6 2.2 Employment........................................................................................................................................ 9 2.3 Value Added .................................................................................................................................... 10 2.4 Labor Compensation ...................................................................................................................... 12 3. National Economic Impact Analysis ................................................................................................ 14 3.1 Upstream Analysis ............................................................................................................................ 14 3.2 Downstream Analysis ....................................................................................................................... 17 4. State-Level Economic Impact Analysis ........................................................................................... 20 4.1 Upstream Output Impacts .............................................................................................................. 21 4.2 Upstream Employment Impacts .................................................................................................... 22 4.3 Upstream Value Added Impacts ................................................................................................... 23 4.4 Upstream Labor Income Impacts .................................................................................................. 24 4.5 Downstream Output Impacts ......................................................................................................... 25 4.6 Downstream Employment Impacts ............................................................................................... 26 4.7 Downstream Value Added Impacts ............................................................................................. 27 4.8 Downstream Labor Income Impacts ............................................................................................ 28 5. Summary and Main Findings ............................................................................................................. 29 References ................................................................................................................................................. 31 Appendix A – Data Sources and Methodology .................................................................................. A-1 A.1 Data Sources ................................................................................................................................. A-1 A.2 Methodology for the National Economic Impact Analysis ..................................................... A-3 A.3 Methodology for the State-Level Analysis.................................................................................. A-4 ii An Economic Analysis of the U.S. Wooden Railway Tie Industry Abbreviations BEA Bureau of Economic Analysis BLS Bureau of Labor Statistics CEW Census of Employment and Wages EC Economic Census GDP Gross Domestic Product INFORUM Interindustry Forecasting at the University of Maryland IO Input-Output IP Intellectual Property NAICS North American Industry Classification System NAM National Association of Manufacturers RTA Railway Tie Association VA Value Added Inforum iii An Economic Analysis of the U.S. Wooden Railway Tie Industry List of Tables Table E.1. Summary of Upstream Analysis ................................................................................................ 3 Table E.2. Summary of Downstream Analysis ........................................................................................... 3 Table E.3. Combined Summary ................................................................................................................. 3 Table E.4. Top Upstream Output Effects by State .................................................................................... 4 Table E.5. Top Upstream Employment Effects by State .......................................................................... 4 Table 1. Output ............................................................................................................................................ 7 Table 2. Employment by Industry Segment ............................................................................................ 10 Table 3. Value Added ............................................................................................................................... 11 Table 4. Labor Compensation ................................................................................................................. 13 Table 5. Top Upstream Suppliers to Sawmills and Wood Preservation (NAICS 3211) in 2016 ........... 15 Table 6. Summary of Upstream Analysis ................................................................................................. 15 Table 7. Sawmills and Wood Preservation (NAICS 32111) Sales to Other Sectors ............................. 17 Table 8. Summary of Downstream Analysis ............................................................................................ 18 Table 9. Combined Summary .................................................................................................................. 19 Table 10. Upstream Output Impacts by State........................................................................................ 21 Table 11. Upstream Employment Impacts by State .............................................................................. 22 Table 12. Upstream Value Added Impacts by State ............................................................................ 23 Table 13. Upstream Labor Income Impacts by State ........................................................................... 24 Table 14. Downstream Output Impacts by State .................................................................................. 25 Table 15. Downstream Employment Impacts by State ........................................................................ 26 Table 16. Downstream Value Added Impacts by State ....................................................................... 27 Table 17. Downstream Labor Income Impacts by State ...................................................................... 28 Table A.1. Main Data Sources Used for this Study ............................................................................... A-1 Table A.2. Illustration of NAICS 2012 ...................................................................................................... A-2 List of Figures Figure E.1. Output ........................................................................................................................................ 1 Figure E.2. Employment ............................................................................................................................... 2 Figure 1. Output ........................................................................................................................................... 7 Figure 2. Distribution of Output in 2016, RTA Product Scope .................................................................. 8 Figure 3. Employment .................................................................................................................................. 9 Figure 4. Value Added .............................................................................................................................. 11 Figure 5. Labor Compensation ................................................................................................................ 13 Figure 6. Upstream Analysis .....................................................................................................................