The Economic Importance of U.S. Shipbuilding and Repair Industry

Marine News
Friday, September 20, 2013

This summer, the U.S. Department of Transportation’s Maritime Administration (MARAD) asserted that domestic shipyards annually support $36 billion in gross domestic product. The report, entitled “The Economic Importance of the U.S. Shipbuilding and Repairing Industry,” aptly laid out how U.S. Shipyards create quality jobs and support economic growth far beyond our nation’s ports and waterways. The report also notes the U.S. shipbuilding industry, unlike the rest of the nation’s consumer-based model, has run a trade surplus in six out of the last ten years. In fact, and BY THE NUMBERS, domestic boatbuilders pack a ferocious economic wallop:

 

  • Total GDP National Impact ($):  … 36 billion
  • Shipbuilding Gross Domestic Product (GDP $):  … 9.8 billion
  • Shipbuilding Labor Income ($):  … 7.9 billion
  • Cumulative Trade Surplus ($):  … 410 million
  • DOT Dollars spent in U.S. Shipyards Since 2009 ($):  …150 million
  • Number of Direct Jobs from Shipbuilding:  … 107,000
  • Average Shipbuilding Incomer (annual $):  … 73,000
  • Number of vessels delivered in 2011:  … 1,457
  • Average Number of Vessels Delivered Annually:  … 1,200
  • Number of U.S. Shipyards:  … 317+


Economic activity directly associated with the U.S. shipbuilding and repairing industry is primarily captured in government data under the North American Industry Classification System (NAICS) sector 336611, Shipbuilding and Repairing. Shipyard activities include ship construction, repair, conversion, and alteration. They also include the production of prefabricated ship and barge sections, and other specialized services. The government says that about 90 percent of revenues were derived from routine repairs and maintenance of maritime vessels.

Of particular interest to MN readers, U.S. shipbuilders delivered 1,260 vessels of all types in 2012, down from 1,457 vessels in 2011. Notably, more than 80 percent of vessels delivered in the last three years have been inland tank and deck barges. Deliveries of tugs and towboats, passenger vessels, commercial fishing vessels, and inland tank barges increased from 2010 to 2012. While recent deep draft orders – particularly in the resurgent Jones Act tanker trades and Tote’s order for 2 LNG-powered containerships – are encouraging, the backbone of the U.S. merchant marine and the shipyards that supply them, continues to be, and will remain, its inland, energy and offshore sectors.
 

Smaller hulls remain the staple for domestic shipbuilding, but the federal government (U.S. Navy, Army, and Coast Guard) remains an important customer for U.S. shipbuilders. While only 15 of the 1,459 vessels delivered in 2011 were delivered to the U.S. government, nearly all (8 out of 11) of the large deep-draft vessels were delivered to U.S. government agencies. The report also revealed that total revenues for U.S. shipbuilding and repair industry amounted to $21.9 billion in 2011, down slightly from $22.1 billion in 2010. Initial estimates for 2012 from industry sources indicate total revenues of $19.7 billion with 60.3 percent coming from military shipbuilding, 21.7 percent from commercial shipbuilding, and the remaining 18.0 percent from ship repairs.

Despite an increase in foreign competition, exports by U.S. shipbuilders have strengthened in recent years, rising to $539.1 million in 2012 (representing 2.7 percent of industry revenues). As a result, the U.S. shipbuilding industry has run a trade surplus in six out of the last 10 years. In fact, combined over the last 10 years the industry has run a trade surplus of $410 million.

Employment in shipbuilding and repairing is concentrated in a relatively small number of states. In fact, 62 percent of all private direct employment in the industry is located in just five states: Virginia, Louisiana, Mississippi, Connecticut, and California. These numbers do not include federal government employment. According to the U.S. Bureau of Labor Statistics, total employment at federal government-operated shipyards was 29,452 in 2011, up from 28,234 in 2010. As a result of the global recession the industry contracted, losing more than 9,000 payroll jobs between 2008 and 2011, before rebounding in 2012. Payroll employment averaged 98,070 over the first half of 2012.

Currently there are 117 active domestic shipyards, spread across 26 states. In addition there are more than 200 shipyards engaged in ship repairs or capable of building ships but not actively engaged in shipbuilding. Of the 117 active shipyards, five are public yards operated by the U.S. Navy or U.S. Coast Guard, six are major shipyards capable of building large naval vessels and/or deep-draft ocean going commercial ships, 20 are large shipyards capable of building mid-sized to large merchant ships, mid-sized to large naval vessels, offshore drilling rigs and high-value, high-complexity smaller vessels. The remaining 86 are relatively small shipyards, capable of building smaller commercial vessels, such as tugs, towboats, offshore service vessels, fishing vessels, ferries and barges. In addition to these shipyards, there are nine shipyards currently producing large yachts and 13 occasionally producing larger vessels. Marad says that another 293 shipyards and boatyards are classified as inactive.

Get the Report
The Marad report, in our estimation, is one of the finer efforts to come out of DOT in a long time. This is what Marad should be doing. Nicely summing up the importance of U.S. boatbuilding, there is much more to the report than what you find on these pages. Access the report at:

www.marad.dot.gov/documents/MARAD_Econ_Study_Final_Report_2013.pdf
 

Maritime Reporter March 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

First Supramax Vessel for Japan-Italy Venture

'DACC Tirreno' was delivered at the Oshima shipyard in Japan yesterday, the first of four Supramax bulk carriers for the dACC Maritime Limited fleet, the joint

Austal Graduates 48 4-Yr Apprentices

Austal USA combined two classes to graduate a total of 48 members of Austal’s cutting-edge four-year apprenticeship program yesterday at a formal ceremony held at the Arthur R.

BAE Systems to Expand San Diego Shipyard

BAE Systems announced it will invest approximately $100 million to expand drydocking capabilities at its San Diego shipyard.   The investment, which will include

Ship Repair & Conversion

Austal Graduates 48 4-Yr Apprentices

Austal USA combined two classes to graduate a total of 48 members of Austal’s cutting-edge four-year apprenticeship program yesterday at a formal ceremony held at the Arthur R.

BAE Systems to Expand San Diego Shipyard

BAE Systems announced it will invest approximately $100 million to expand drydocking capabilities at its San Diego shipyard.   The investment, which will include

Washington State Ferry Tacoma Returns to Service

Washington State Ferry M/V Tacoma will return to work on the Seattle/Bainbridge Island route starting March 28 after suffering electrical damage last summer.   The

Finance

JV Wins $2bln Freeport LNG Contract in US

A joint venture (JV) between CB&I, Chiyoda International and Zachry Industrial has won a contract worth over $2bn from FLNG Liquefaction 3 for a liquefied natural

Puerto Rico Readies for Largest Cruise Ships

Thanks to a pier expansion and enhancement, Puerto Rico will welcome the two largest cruise ships in the world, Royal Caribbean International’s Oasis of the Seas and Allure of the Seas, in 2016.

Carnival Sails to Profit

The world's largest cruise company Miami-based Carnival Corp reported a net profit of $49 million, or 6 cents per share in the first quarter ended Feb. 28.   That

Marine Equipment

Viking Bags Charter Deal for AHTS Brage Viking

Viking Supply Ships has entered into a contract with an Oil major for the charter of “Brage Viking” commencing 1stof April 2015. The duration is for 2 years and 8 months firm,

SimCity

Building Capacity, as Deadline for Trained Crews Nears   “You see that ship. That’s our ship,” says Karsten Saevik, as he directs our attention to the virtual

Schmiedag and Wildauer Schmiedewerke: 'We Forge Partnerships'

Olaf Wiertz, Sales Director at Schmiedag GmbH (SDG) and Wildauer Schmiedewerke GmbH & Co. KG (WSW) said: “We are more than just a supplier to our customers – we are their partner.

Vessels

Carnival Sails to Profit

The world's largest cruise company Miami-based Carnival Corp reported a net profit of $49 million, or 6 cents per share in the first quarter ended Feb. 28.   That

Smoke: Cruise Ship Evacuates Passengers

A number of passengers and crew members were evacuated after smoke was spotted billowing from the front section of Carnival Liberty cruise ship docked in the Dutch Caribbean nation of St Maarten.

First Supramax Vessel for Japan-Italy Venture

'DACC Tirreno' was delivered at the Oshima shipyard in Japan yesterday, the first of four Supramax bulk carriers for the dACC Maritime Limited fleet, the joint

Government Update

Mexico Unveils National Strategy ahead of Paris Climate Talks

Mexico on Friday said it will cap its greenhouse gas emissions by 2026, becoming one of the first countries to formally submit its national climate plan the

Mediterranean Rescue Operations Strain Shipping

The Wall Street Journal ran a story yesterday describing how the increasing number of seaborne migrants making the journey from Africa to Europe has not only

Port of Aden Under Threat with Enemy at the Gates

As Saudi Arabia and its Arab allies stage air strikes against Shi'ite Muslim militiamen threatening to topple Yemeni President Abd-Rabbu Mansour Hadi, the southern

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Naval Architecture Navigation Pod Propulsion Salvage Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.3530 sec (3 req/sec)