U.S. Coal Exports Help Fuel Economic Recovery
This Contributed Column is brought to you by the International Economic Development Council's 2015 Annual Conference. Join the largest international gathering of economic development professionals in the world. Click here to learn more about this important event.
Posted by Heidi Schwartz
Rising exports of U.S. coal to Europe and Asia added $16.6 billion to the U.S. economy in 2011, making significant contributions to America’s economic recovery and job creation in many industrial sectors as well as in regions far beyond the nation’s coalfields.
In a report released by the National Mining Association (NMA), the industry’s national trade group, Ernst & Young analysts found that the 107 million short tons of American coal exported in 2011 supported 141,270 high-wage jobs paying nearly 50 percent above industry averages. According to the report, “U.S. Coal Exports: National and State Economic Contributions,” an estimated 168,430 jobs were supported by the 125.7 million tons exported last year, a record volume. Each ton of coal exported supported 1,320 jobs, said the study commissioned by NMA to document the broad benefits of U.S. coal exports.
“This report confirms the valuable contributions that our economy derives from U.S. coal exports,” said NMA President and CEO Hal Quinn. “These benefits include good jobs for American workers—from the mines to rail transport and port facilities—as well as new revenue for state and local governments pressed to fund essential services.”
Rising off-shore demand has steadily boosted the share of domestically mined coal sold abroad. From 2000 to 2010, U.S. coal mines exported about 5 percent of total production on average but have since doubled the export share to average 10 percent of production. “The U.S. has the world’s largest supply of coal at a time when the rest of the world—from Germany to China—is using more coal to ensure affordable and reliable electricity and as an essential input in steelmaking,” Quinn said.
The benefits have been especially rich for the top exporting states, including Virginia, Louisiana and Maryland. Particularly valuable for job creation has been the export from Appalachian mines of metallurgical coal used in steelmaking, which comprised 65 percent of total coal exports.
Average annual income per worker in the coal export market is $96,100, a rare example of new high-wage job creation in an economy struggling to create good employment opportunities.
“These findings underscore the potential for other states, especially on the West Coast, to benefit economically from sharply rising coal demand from Asia projected over the coming decades,” Quinn said.