The Railway Supply Institute (RSI), Railway Engineering-Maintenance Suppliers Association (REMSA) and Railway Tie Association (RTA) have issued Rail Supply Industry: Manufacturing and Services Keeping the American Economy on Track, their latest major economic impact study, which “quantifies the economic and workforce impact of the products and services produced by the U.S. railway supply industry—showcasing the power of the rail supply industry.” The three associations compiled the study in partnership with Oxford Economics.
The study (downloadable below) indicates that, in 2020:
- The U.S. rail supply industry’s total economic impact was $75.8 billion of GDP (Gross Domestic Product), 682,426 jobs, $49.0 billion of labor income, and $15.5 billion in taxes. These numbers combine the direct, indirect, and induced contributions of the sector’s activities.
- The direct contribution measures the GDP and employment of all business operations of the rail supply industry. The sector’s direct contribution was $27.7 billion of output and 239,272 jobs.
- The indirect contribution measures the output and employment in the domestic supply chain that supports the rail supply industry. The sector’s indirect contribution was $22.2 billion of output and 191,071 jobs.
- For compensation paid to workers in the rail supply industry, the induced contribution measures the output and employment supported by the spending of the workers from the sector and its supply chain. The rail supply industry’s induced contribution was $25.9 billion of output and 252,082 jobs. The high number of induced jobs is the result of the above-average compensation in the rail supply industry. The average compensation is $91,263 annually, which is 34% higher than the national average ($67,872) across all industries.
Economic Impact Study State Highlights
“The rail supply industry plays an essential and powerful role in driving the U.S. economy, and the results of this study are undeniable,” said RSI President Patty Long. “Despite COVID-19 challenges to the supply chain felt around the world, it’s apparent that the industry is continuing to bounce back.”
“The rail industry is a vital economic driver that effects everyday life across the nation,” said REMSA President Urszula Soucie. “This report proves how far reaching the impact is in today’s world. We are excited to support the launch of this report and grow awareness of the positive influence our industry has on the country.”
“Both the direct and indirect economic contributions made on an annual basis emphasize the importance of the rail supply industry,” added RTI Executive Director Dr. Nate Irby. “From employment numbers to compensation and more, the impact is felt nationwide and we’re proud to help bring this data to light.”
“The contribution of the rail supply industry underscores the far-reaching importance of the rail manufacturing sector’s support of quality jobs, which enable rail transportation to move billions of tons of raw materials and finished goods,” noted Oxford Economics Head of Consulting Hamilton Galloway. “Our modeling shows that rail supply supports economic activity in every state.”