Washington — The U.S. plastics industry has more than made a comeback since the global recession that began in 2008, according to two detailed reports by the Society of the Plastics Industry Inc. released Dec. 2.
The Washington-based trade group's economic reports, "Size and Impact of the Plastics Industry on the U.S. Economy" and "2015 Global Business Trends," dig into the conditions fueling the plastics industry's significant growth and competitive position in the U.S. and global economic markets.
“Our industry has recovered from the recession that cost many of us jobs, financial security and a good night's sleep,” said SPI President and CEO Bill Carteaux on Dec. 2. “The data show that the U.S. plastics industry is setting records across the world as a major force driving employment, innovation and product and material sales. The plastics industry continues to grow.”
In 2014, the U.S. plastics industry employed more than 940,000 people and saw a record $427.3 billion in shipments, according to the SPI report. Plastics shipments have seen 11.5 percent growth since 2012, generally seen as the beginning of the end for the recession.
Federal statistics, under the North American Industry Classification System (NAICS), actually break up the plastics industry, counting some segments separately, said Michael Taylor, SPI's senior director of international affairs and trade. But looking upstream and downstream to include such market segments as suppliers, according to the report, U.S. plastics jobs grew to 1.7 million and total shipments to $583.7 billion.
Plastics also remains the No. 3 U.S. manufacturing industry, behind the petroleum and automotive industries and ahead of basic chemicals.
For the first time since 1996, California was unseated as the state with the most plastics workers. Texas now has 77,000 plastics workers to California's 73,800, driven in part by a more favorable regulatory climate and the continuing shale gas boom. Ohio was a close third with 73,700 plastics workers in 2014.
Indiana remains the top state for plastics concentration, where plastics jobs account for 16.4 of every 1,000 non-farm jobs.
Mexico and Canada remain the U.S. plastics industry's largest export markets at $15.8 billion and $13.2 billion, respectively, according to SPI's 2015 Global Business Trends report . China is the third largest U.S. plastics export market, though overall, the U.S. had its largest trade deficit with China — $9.2 billion in 2014.
The worldwide plastics market continues to be driven primarily by growth in the transportation, healthcare and packaging end markets, according to SPI. The low cost of natural gas and to a lesser extent, oil in the U.S. compared to other regions, has driven down the cost of doing business in the United States for the plastics industry.
About 85 percent of U.S. polymer feedstock comes from natural gas, said Carteaux, while the rest of the world's plastics still largely rely on more expensive crude oil. Vinyl chloride, PP and PE producers will continue to benefit most from the U.S. shale boom, he said.
However, the industry's trade surplus fell 14.9 percent to $10.4 billion in 2014, from $12.2 billion in 2013. While 2014 exports rose 3.1 percent, imports increased at a speedier 7.7 percent on an improving U.S. economy but continued weakness in Europe.
Driving the export increase was the mold market, with a 4.5 percent improvement in trade deficit at $1.1 billion for 2014. The U.S. plastics machinery industry also shrank its deficit, registering a $1.2 billion trade deficit in 2014, which was a 5.2 percent decrease on the year.
Plastics products trends were largely flat for 2014, the report says, while resin trade surplus dropped 5.4 percent to $19.5 billion as U.S. resin producers lost some of their competitive advantage because of the high value of the dollar and falling oil prices.