Fluent Essays

For the first part, simply write, in your own words, a synopsis of what you read in the report. For the second potion, search the Internet to find an example of a retailer having a positive impact on a local community (any retailer and any community of your choice). Then tell me a bit about that. n r f. c o m / r e t a i l s i m p a c t Underwritten By The ECONOMIC IMPACT of the U.S. RETAIL INDUSTRY NRF is the world’s largest retail trade association, representing discount and department stores, home goods and specialty stores, Main Street merchants, grocers, wholesalers, chain restaurants and Internet retailers from the United States and more than 45 countries. Retail is the nation’s largest private sector employer, supporting one in four U.S. jobs – 42 million working Americans. Contributing $2.6 trillion to annual GDP, retail is a daily barometer for the nation’s economy. NRF’s This is Retail campaign highlights the industry’s opportunities for life-long careers, how retailers strengthen communities, and the critical role that retail plays in driving innovation. www.nrf.com On behalf of the National Retail Federation and American Express, we are pleased to share with you this new report demonstrating retail’s enormous impact on the U.S. economy. The report, by PricewaterhouseCoopers LLP, proves that retail powers the American economy. According to the study, retail is the largest private employer in the United States. Retail directly and indirectly supports 42 million jobs, provides $1.6 trillion in labor income and contributes $2.6 trillion annually to U.S. GDP. This report also makes clear that retail is American small business. An overwhelming majority of retail businesses – 99\% –employ fewer than 50 people. In fact, these retailers provide 40 percent—or 11.5 million—of the 29 million jobs in retail. Working together, retail will continue to power our economy and provide opportunities for millions of Americans seeking rewarding careers. Sincerely, Gunther Bright EVP, Merchant Services – U.S. American Express Matthew R. Shay President & CEO National Retail Federation RETAIL’S IMPACT Find Out More At n r f. c o m / r e t a i l s i m p a c t www.pwc.com/us/nes THE ECONOMIC IMPACT OF THE US RETAIL INDUSTRY Prepared for National Retail Federation September 2014 The Economic Impact of the US Retail Industry Table of Contents Executive Summary E-1 I. Introduction 2 Ii. Industry Definition 5 Iii. National Results 9 Iv. State Results 22 V. Congressional District Results 38 Appendices A. Detailed State-By-State Operational Impact Results A-1 B. Detail on Retail Firms, Employment, and Labor Income by Firm Size B-1 C. Detailed Occupation Data for the US Retail Industry C-1 D. Data Sources and Methodology D-1 The Economic Impact of the US Retail Industry PwC E-1 Executive Summary The National Retail Federation engaged PwC to quantify the impact of the retail industry on the US economy.1 In evaluating the US retail industry’s economic impact, this report considers three separate channels—the direct, indirect, and induced impacts—that in aggregate provide a measure of the total economic impact of the US retail industry:  Direct impact is measured as the jobs, labor income, and gross domestic product (“GDP”) within the US retail industry.  Indirect impact is measured as the jobs, labor income, and GDP occurring in other industries due to the US retail industry’s purchases of intermediate inputs (other than merchandise intended for resale) and capital goods.  Induced impact is measured as the jobs, labor income, and GDP resulting from household spending of income earned either directly or indirectly from the US retail industry’s economic activities. This report finds that in 2012, there were nearly 3.8 million retail establishments (including food services and drinking places) across the country, counting both those with paid employees and nonemployers (which primarily consist of self-employed individuals operating small unincorporated businesses) (see Table E-1). These businesses accounted for 12.0 percent of all business establishments in the country in 2012. The retail industry directly provided 29 million jobs for American workers (accounting for 16.1 percent of the national total), making it the largest private-sector employer in the country, surpassing all other industries at the 2-digit North America Industry Classification System (NAICS) code level (see Table E-2). The industry also directly paid out $822.5 billion in wages and salaries and fringe benefits and proprietors’ income (8.4 percent of the national total), and generated $1.2 trillion in GDP (7.7 percent of the national total), making it the third largest GDP contributor among all 2-digit NAICS private industries.2 Table E-1. The US Retail Industry’s Direct National Impact, 2012 Item Direct National Impact Percent of US Economy Establishments (1) 3,793,622 12.0\% Employment (Jobs) (2) 29 million 16.1\% Labor Income (3) $822.5 billion 8.4\% GDP $1.2 trillion 7.7\% Source: PwC calculations using data from the US Bureau of Economic Analysis, the Census Bureau, and the Bureau of Labor Statistics for the retail industry, including food services and drinking places. (1) An establishment is a single physical location at which business is conducted. A business may consist of more than one establishment. (2) Employment is defined as the number of payroll and self-employed jobs, including part-time jobs. (3) Labor income is defined as annual wages and salaries and benefits as well as proprietors’ income. 1 For the study, the US retail industry is defined to include Retail Trade and Food Services and Drinking Places. 2 It should be noted that all impacts are reported in gross terms, which means that they do not take into account what would have occurred in the absence of the retail industry. The Economic Impact of the US Retail Industry PwC E-2 Table E-2. Direct Employment by 2-Digit NAICS Industry, 2012 Industry Description Employment (Jobs) Retail trade (including food services and drinking places) 28,984,100 Health care and social assistance 19,855,000 Manufacturing 12,596,500 Professional, scientific, and technical services 12,244,700 Administrative and waste management services 11,087,500 Other services, except public administration 10,544,200 Finance and insurance 9,985,200 Construction 8,830,900 Real estate and rental and leasing 8,243,200 Wholesale trade 6,300,100 Transportation and warehousing 5,838,400 Educational services 4,196,400 Arts, entertainment, and recreation 3,997,600 Agriculture, forestry, fishing, and related activities 3,480,700 Information 3,257,900 Management of companies and enterprises 2,166,800 Mining 1,328,700 Utilities 575,200 Source: US Bureau of Economic Analysis. The Economic Impact of the US Retail Industry PwC E-3 Total National Impact Counting the direct, indirect, and induced impacts, the US retail industry’s total employment impact on the national economy in 2012 amounted to 42 million full-time and part-time jobs, accounting for 23.4 percent of total national employment (see Table E-3). The industry’s total labor income impact was estimated to be $1.58 trillion or 16.1 percent of national labor income in 2012. The industry’s total GDP impact was $2.59 trillion, accounting for 16.0 percent of US GDP in 2012. Table E-3. Total Impact of the Retail Industry on the US Economy, 2012 Item Total National Impact Percent of US Economy Employment (Jobs) (1) 42 million 23.4\% Labor Income (2) $1.58 trillion 16.1\% GDP $2.59 trillion 16.0\% Source: PwC calculations using the IMPLAN modeling system (2012 database) for the retail industry, including food services and drinking places. (1) Employment is defined as the number of direct, indirect, and induced payroll and self-employed jobs, including part-time jobs. (2) Labor income is defined as annual wages and salaries and benefits as well as proprietors’ income. US Retail Industry by Firm Size While businesses in the US retail industry range from small family-run businesses to large global retailers with thousands of employees, available data indicate that the majority of retail businesses are relatively small. In fact, as shown in Table E-4, 98.6 percent of all US retail firms had less than 50 employees in 2012.3 These firms accounted for 39.8 percent of all retail industry jobs and 37.4 percent of total labor income in the retail industry in 2012. 3 A firm is a business organization consisting of one or more domestic establishments that were specified under common ownership or control. The Economic Impact of the US Retail Industry PwC E-4 Table E-4. Percent of US Retail Firms, Employment, and Labor Income by Firm Size, 2012 Firm Size Retail Firms Retail Employment Retail Labor Income Count Percent of Total Jobs Percent of Total Amount ($ billion) Percent of Total Retail firms with less than 50 employees* 3,201,226 98.6\% 11,525,422 39.8\% $307.8 37.4\% Retail firm with less than 10 employees* 2,957,925 91.1\% 6,487,763 22.4\% $170.6 20.7\% Retail firms with 50 or more employees 45,939 1.4\% 17,458,678 60.2\% $514.7 62.6\% Total 3,247,165 100.0\% 28,984,100 100.0\% $822.5 100.0\% Source: PwC calculations based on data from the US Bureau of Economic Analysis and the US Census Bureau for the retail industry, including food services and drinking places. *Includes businesses with and without paid employees. The Economic Impact of the US Retail Industry PwC E-5 Recent Growth Trends The US retail industry has undergone a number of changes in recent years, one of which is the continued expansion of online sales. Between 2010 and 2012, the two fastest growing retail subsectors by payroll employment were “Electronic Auctions” and “Electronic Shopping,” with average annual growth rates of 23.4 percent and 16.5 percent, respectively (see Table E-5). Employment growth in these subsectors reflects the fast pace of e-commerce over this period. In contrast, overall payroll and self- employed jobs in the retail industry grew at an average annual rate of 2.3 percent over the same period. Table E-5. Top Growing Retail Subsectors by Payroll Employment, 2010-2012 NAICS Description Average Annual Job Growth 454112 Electronic Auctions 23.4\% 454111 Electronic Shopping 16.5\% 722330 Mobile Food Services 11.8\% 446120 Cosmetics, Beauty Supplies, and Perfume Stores 8.6\% 453310 Used Merchandise Stores 7.7\% Source: PwC calculations based on data from the US Bureau of Labor Statistics. US Retail Industry by Occupation Type While most of the jobs directly supported by the US retail industry are in sales, food preparation, and related occupations, the industry also directly supports jobs in a number of other occupations, such as logistics and freight transportation; finance, insurance, and real estate; and technology and IT related occupations. These and other occupations are further supported by the US retail industry’s indirect and induced impacts on other industries. Table E-6 summarizes the direct, indirect and induced, and total jobs supported by the US retail industry by type of occupation. The Economic Impact of the US Retail Industry PwC E-6 Table E-6. Direct, Indirect and Induced, and Total Jobs Supported by the US Retail Industry by Occupation Type, 2012 Occupation Type Direct Jobs Indirect/ Induced Jobs Total Jobs Total Job Impact Share Food preparation and serving related occupations 10,611,782 305,444 10,917,226 25.8\% Sales and related occupations 10,090,048 781,808 10,871,856 25.7\% Logistics and freight transportation occupations 3,278,290 1,692,601 4,970,892 11.8\% Management, business operations, office and administrative occupations 1,827,137 2,537,975 4,365,111 10.3\% Building, cleaning, maintenance, installation, and repair occupations 1,104,722 1,497,287 2,602,008 6.2\% Health care, personal care and service occupations 748,013 1,628,967 2,376,981 5.6\% Finance, insurance, and real estate occupations 564,616 1,248,175 1,812,791 4.3\% Technology and IT related occupations 202,654 606,892 809,546 1.9\% All other occupations 556,838 3,006,816 3,563,654 8.4\% Total Job Impact - All Occupations 28,984,100 13,305,965 42,290,065 100\% Source: PwC estimates based on data from the Bureau of Labor Statistics and the IMPLAN modeling system (2012 database) for the retail industry, including food services and drinking places. The Economic Impact of the US Retail Industry PwC E-7 Retail Establishments by State The economic impact of the retail industry reaches all 50 states and the District of Columbia. The total number of retail establishments ranged from 8,300 (Alaska) to 418,840 (California) in 2012. The top 15 states in terms of the total number of retail establishments in 2012 were California, Texas, Florida, New York, Pennsylvania, Illinois, Ohio, Georgia, North Carolina, Michigan, New Jersey, Virginia, Tennessee, Washington, and Indiana. Combined these states accounted for 65 percent of the total retail establishments in the country in 2012. Retail Employment by State The number of jobs directly attributable to the retail industry’s operations ranged from a low of 59,700 (Wyoming) to over 3.2 million (California) in 2012. The top 15 states in terms of the number of retail jobs in 2012 were California, Texas, Florida, New York, Pennsylvania, Illinois, Ohio, North Carolina, Georgia, Michigan, New Jersey, Virginia, Massachusetts, Tennessee, and Indiana. Combined these states account for 65 percent of the total national retail employment in 2012. Per Capita Retail GDP by State Across all 50 states and the District of Columbia, the per capita GDP directly attributable to the retail industry’s operations was $3,598 in 2012. The top 15 states by per capita retail GDP in 2012 were Hawaii ($5,019), North Dakota ($4,953), District of Columbia ($4,907), Washington ($4,834), New Hampshire ($4,740), Nevada ($4,686), Wyoming ($4,535), Connecticut ($4,477), Arizona ($4,368), New York ($4,366), Maine ($4,343), South Dakota ($4,329), Vermont ($4,302), Colorado ($4,204), and New Jersey ($4,195). Per Capita Retail Labor Income by State Across all 50 states and the District of Columbia, the per capita labor income directly attributable to the retail industry’s operations was $2,620 in 2012. The top 15 states by per capita retail labor income in 2012 were New Hampshire ($3,726), District of Columbia ($3,483), North Dakota ($3,207), Connecticut ($3,101), Hawaii ($3,074), Alaska ($3,004), Massachusetts ($2,942), Vermont ($2,941), Nevada ($2,933), Washington ($2,928), New Jersey ($2,927), Maine ($2,882), New York ($2,828), Delaware ($2,815), and Colorado ($2,800). Total Employment Impact by State Counting the direct, indirect and induced impacts, the total number of full-time and part-time jobs attributable to the retail industry’s operations ranged from 79,000 (Wyoming) to 4.7 million (California) in 2012. The top 15 states by the total employment impact attributable to the retail industry’s operations in 2012 were California, Texas, Florida, New York, Pennsylvania, Illinois, Ohio, Georgia, North Carolina, Michigan, New Jersey, Virginia, Massachusetts, Tennessee, and Washington. Total Employment Share by State The top 15 states by the total employment impact attributable to the retail industry’s operations as a share of the total jobs in a state in 2012 were New Hampshire (26.4 The Economic Impact of the US Retail Industry PwC E-8 percent), Florida (26.0 percent), South Carolina (25.5 percent), Maine (25.5 percent), Arizona (24.8 percent), Montana (24.7 percent), Nevada (24.2 percent), Tennessee (24.1 percent), Oregon (24.1 percent), Ohio (23.9 percent), Missouri (23.9 percent), Michigan (23.8 percent), Hawaii (23.8 percent), Delaware (23.8 percent), and Idaho (23.7 percent). Retail Employment by Congressional District At the congressional district level, the number of jobs directly attributable to the retail industry was no less than 23,000 in any district in 2012. The retail industry directly provided 50,000 or more jobs in 388 congressional districts. The top 15 congressional districts in terms of direct retail jobs in 2012 are listed in Table E-7, below. The 12th District of New York (which includes most of the East Side of Manhattan and Roosevelt Island and extends across the East River into the Boroughs of Queens (including Astoria, Long Island City, and parts of Woodside) and Brooklyn (including Greenpoint)) had the highest retail employment (187,332). The 10th district of New York (which includes the parts of Manhattan’s upper west side (including Greenwich Village and the Financial District) and parts of Brooklyn) had the second highest retail employment (137,650). Texas’s 24th ranked among the top 15 as well at Montana’s, South Dakota’s, and Delaware’s at-large congressional districts. California’s 12th and 33rd, Nevada’s 1st, Missouri’s 2nd, Florida’s 10th and 22nd, Illinois’s 7th, and Colorado’s 1st and 2nd also ranked among the top 15 congressional districts ranked by retail employment in 2012. Table E-7. The Retail Industry’s Direct Impact on Congressional Districts in 2012 Top 15 Congressional Districts, Ranked by Retail Employment Rank Congressional District Employment (Jobs)(1) Labor Income ($ Million)(2) GDP ($ Million) Retail Establishments(3) 1 NY-12 187,332 $8,874 $11,951 23,734 2 NY-10 137,650 $6,321 $8,485 19,114 3 TX-24 123,215 $3,747 $5,700 14,861 4 MT-1 (At-Large) 110,964 $2,760 $3,506 16,449 5 CA-33 108,600 $3,515 $5,315 14,772 6 CA-12 105,321 $4,523 $5,920 15,858 7 NV-1 101,683 $3,234 $5,084 10,335 8 MO-2 99,694 $2,654 $3,714 10,119 9 FL-22 97,760 $2,966 $4,377 15,482 10 SD-1 (At-Large) 97,450 $2,308 $3,608 13,867 11 IL-7 94,297 $2,900 $4,116 10,856 12 DE-1 (At-Large) 93,802 $2,581 $3,610 10,973 13 FL-10 93,546 $2,641 $3,989 11,245 14 CO-1 93,380 $2,996 $4,136 11,902 15 CO-2 92,389 $2,438 $3,704 12,867 Source: PwC calculations using the IMPLAN modeling system (2012 database) and data from the US Bureau of Economic Analysis, the Census Bureau, and the Bureau of Labor Statistics for the retail industry, including food services and drinking places. (1) Employment is defined as the number of payroll and self-employed jobs, including part-time jobs. (2) Labor income is defined as annual wages and salaries and benefits as well as proprietors’ income. (3) An establishment is a single physical location at which business is conducted. A business may consist of more than one establishment. The Economic Impact of the US Retail Industry PwC E-9 Total Employment Impact by Congressional District The top 15 congressional districts in terms of the total job impact attributable to the retail industry’s operations in 2012 were New York’s 12th (269,537) and 10th (194,584), Texas’s 24th (182,522), Illinois’s 7th (157,282), California’s 33rd (156,436), Montana’s at-large congressional district (156,058), California’s 12th (153,695), Florida’s 22nd (143,423), Nevada’s 1st (141,433), Colorado’s 1st (140,702), Missouri’s 2nd (138,716), Florida’s 10th (135,326), Arizona’s 6th (135,287) and 9th (134,468), and South Dakota’s at-large congressional district (134,301) (see Table E-8). Table E-8. The Retail Industry’s Total Impact on Congressional Districts in 2012 Top 15 Congressional Districts, Ranked by Employment Rank Congressional District Employment (Jobs)(1) Labor Income ($ Million)(2) GDP ($ Million) 1 NY-12 269,537 $21,665 $29,222 2 NY-10 194,584 $14,655 $19,984 3 TX-24 182,522 $8,152 $12,947 4 IL-7 157,282 $8,261 $12,252 5 CA-33 156,436 $7,060 $11,420 6 MT-1 (At-Large) 156,058 $4,548 $6,874 7 CA-12 153,695 $10,051 $13,587 8 FL-22 143,423 $5,568 $8,713 9 NV-1 141,433 $5,334 $8,821 10 CO-1 140,702 $6,639 $9,826 11 MO-2 138,716 $5,126 $7,584 12 FL-10 135,326 $4,719 $7,724 13 AZ-6 135,287 $5,486 $9,568 14 AZ-9 134,468 $5,513 $9,656 15 SD-1 (At-Large) 134,301 $4,173 $6,699 Source: PwC calculations using the IMPLAN modeling system (2012 database) for the retail industry, including food services and drinking places. (1) Employment is defined as the number of direct, indirect, and induced payroll and self-employed jobs, including part-time jobs. (2) Labor income is defined as annual wages and salaries and benefits as well as proprietors’ income. Introduction The Economic Impact of the US Retail Industry PwC 2 I. Introduction The National Retail Federation engaged PwC to quantify the impact of the retail industry on the US economy. For the study, the US retail industry is defined to include retail trade and food services and drinking places. The Retail Trade subsector comprises establishments engaged in retailing merchandise and rendering services incidental to the sale of merchandise. The retailing process is the final step in the distribution of merchandise. The Retail Trade subsector comprises two main types of retailers: store and nonstore retailers. 1. Store retailers, as defined by the North American Industry Classification System (NAICS), operate fixed point-of-sale locations, located and designed to attract a high volume of walk-in customers. In general, retail stores have extensive displays of merchandise and use mass-media advertising to attract customers. They typically sell merchandise to the general public for personal or household consumption, but some also serve business and institutional clients. In addition to retailing merchandise, some types of store retailers are also engaged in the provision of after-sales services, such as repair and installation. 2. Nonstore retailers, like store retailers, are organized to serve the general public, but their retailing methods differ. They consist of electronic shopping and mail-order houses; vending machine operators; and direct selling establishments. As defined by NAICS, the establishments of this subsector retail all types of merchandise using the internet as well as methods such as the broadcasting of “infomercials,” the broadcasting and publishing of direct-response advertising, the publishing of paper and electronic catalogs, door-to-door solicitation, in- home demonstration, selling from portable stalls (street vendors, except food), and distribution through vending machines. The Food Services and Drinking Places subsector prepares meals, snacks, and beverages to customer order for immediate on-premises and off-premises consumption. It includes full-service restaurants; limited-service eating places; special food services, such as food service contractors, caterers, and mobile food services; and drinking places. In evaluating the US retail industry’s economic impacts, this report considers all three impacts—direct, indirect, and induced—that in aggregate provide a measure of the total economic impact of the US retail industry. Four main metrics are used to quantify the direct economic impact of the US retail industry: 1. Number of establishments: An establishment is a single physical location at which business is conducted. A business may consist of more than one establishment. 2. Employment: Jobs are positions filled by part-time and full-time employees or by self-employed individuals. 3. Labor income: This includes wages and salaries, commissions, vacation and sick-leave pay, fringe benefits, and all other forms of compensation, including employer contributions for employee pension and insurance funds and The Economic Impact of the US Retail Industry PwC 3 government social insurance. It also includes proprietor’s income for self- employed individuals and partnerships. 4. Gross Domestic Product (“GDP”): Also known as margin or value added, the retail industry’s GDP refers to the difference between receipts or revenues and the cost of goods sold. The economic impact of the US retail industry extends beyond the industry itself. In its role as the distributor of merchandise to the final consumer, the retail industry requires other intermediate inputs from various industries (such as Real Estate, Business Services, Finance, Accommodation, Communication Services, Transportation, and Wholesale Trade) for its operations. Similarly, the industry’s capital investment creates demand for its capital-goods suppliers. These industries, in turn, purchase goods and services from their supply chain, spurring further economic activities. These supply chain effects represent the retail industry’s indirect economic impact. Additionally, the employees and business owners in the retail industry and its supply chain, in their role as consumers, purchase an array of goods and services, generating further demands that ripple through the economy. These represent the retail industry’s induced economic impact. This study separately quantifies the industry’s operational impact (due to its direct economic impact and purchases of intermediate inputs other than merchandise intended for resale) and capital investment impact (due to its investment in new structures and equipment) at the national level.4 It further breaks out the industry’s operational impact at the state and congressional district level.5 It should be noted that all impacts are reported in gross terms, which means that they do not take into account what would have occurred in the absence of the retail industry. The rest of this report is organized as follows. Section II defines the US retail industry for this study. Section III presents the US retail industry’s national economic impact. Section IV presents the industry’s economic impact at the state level. Section V highlights the industry’s economic impact at the congressional district level. A summary table for each state with its full congressional district level results is included in Appendix A. Appendix B provides additional detail on the distribution of US retail establishments and jobs by firm size. Detailed occupation data for the US retail industry in 2012 are presented in Appendix C. The data sources and methodology used in the impact analysis are discussed in Appendix D. 4 Leased structures and equipment are not included in the capital investment impact measure in this report. The services of leasing companies are included in the industry’s operational impact. 5 The industry’s capital investment impact is not quantified …