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With all the attention given to the Internet and the growing importance of electronic commerce, it's sometimes forgotten that mail and other paper-based industries represent more than 9,000,000 American jobs -- one of every fifteen -- as well as economic activity worth more then $850 billion annually.

"Contrary to speculation that computers would transform the American workplace into a paperless environment, the opposite result has occurred," reports the Bureau of Labor Statistics (BLS). "The increased availability of photocopiers, fax machines, and computers has resulted in a dramatic increase in the use of 'office papers' over the last two decades." (1)

"Let's not sell paper documents short," says Microsoft chairman Bill Gates. "The paper-based book, magazine, or newspaper still has a lot of advantages over its digital counterpart. A newspaper offers a wide field of vision, good resolution, portability, ease of use. A book is small, lightweight, high-resolution, and inexpensive compared to the cost of a computer or some other information appliance you need to read a digital document." (2)

Even in the Internet era, the fact is that traditional paper-based products and services have grown.

• Paper consumption increased from 84.9 million tons in 1990 to 97.3 million tons in 2002. (3)
• In 2000, says the Federal Reserve, we wrote 42.5 billion paper checks worth $39.3 trillion dollars. Well into the electronic era, checks represented 84.4 percent of the money used in non-cash transactions -- more than five times as much as credit cards, debit cards and retail electronic payments combined. (4)
• Mail volume has gone from 166.4 billion pieces in 1992 to 202.8 billion pieces in 2002. (5)

"An increasing standard of living is associated with greater paper usage, as consumption of most products involves some paper content in packaging, labeling, and advertising," says the BLS. (6)

"Computer technology was supposed to replace paper," explains The New Yorker magazine. "But that hasn't happened." (7)

"Every country in the Western world uses more paper today, on a per-capita basis, then it did ten years ago," the magazine reports. "The consumption of uncoated free-sheet paper, for instance -- the most common kind of office paper -- rose almost 15 percent in the United States between 1995 and 2000. This is generally taken as evidence of how hard it is to eradicate old wasteful habits and of how stubbornly resistant we are to the efficiencies offered by computerization. A number of cognitive psychologists and ergonomics experts, however, don't agree. Paper has persisted, they argue, for very good reasons: when it comes to performing certain kinds of cognitive tasks, paper has many advantages over computers."

The morning newspaper, the day's mail, and computer print-outs are among the thousands of ways that paper is used daily. No segment of the economy; no city, state, or congressional district; and no business, charity, or association operates without paper. Without the real information highway -- the one made of paper -- one American in fifteen would be unemployed and the economy would totter on the brink of depression.

Direct Employment

Where are the jobs and dollars associated with paper? A review of government data and other resources shows there are 4,875,223 jobs related directly to mail and paper-based industries, jobs held by people whose employment depends entirely on the availability of paper. The attached chart details the eight major employment classifications for these workers. In capsule terms, the leading job categories include:

Paper. The production, distribution, and collection of paper includes nearly 1.15 million workers.

Printing. Ranging from press operators to photo-engravers, printing nationwide employs nearly 600,000 people.

Postal Service. The United States Postal Service has 854,376 employees. After Wal-Mart, it is the nation's second-largest civilian employer.

Delivery Services. In addition to the Postal Service, a number of private-sector organizations also provide delivery services. The major companies in this field include FedEx (184,953 workers worldwide), United Parcel Service (320,000 workers in the U.S.) and DHL Worldwide (an estimated 16,000 workers in the U.S.). In addition, there are 166,000 non-postal mail clerks and 141,000 messengers not employed by air carrier services. In total, delivery services represent nearly 828,000 jobs.

Editorial. Almost 550,000 people are engaged in writing, editing, the visual arts, and archiving written material.

Communications. Promotional efforts for businesses, charities, and politicians engage 420,000 people.

Forestry & Logging. Because of recycling this job category is relatively small -- only 141,000 jobs nationwide.

Libraries. Libraries across the country employ 356,000 people.

The Multiplier Effect

Jobs do not exist in a vacuum. Each job creates demand for more products and services, what economists call a "multiplier" effect. One way to demonstrate the multiplier effect is to consider what happens when the local pizza store mails out coupons to neighborhood homes and businesses. The store gets more sales -- but it's not alone. The businesses that supply cheese, flower, and tomatoes also grow. They buy more equipment and require more services. More cartons are needed and more goods are shipped. What started as the sale of a few extra pizzas now has impact far beyond the local community.

The Bureau of Labor Statistics says that accounting for jobs is a complex task. For instance, in a review of paper-related manufacturing employment the Bureau accounted for hundreds of thousands of jobs but also explained that "this list does not exhaust all the remaining jobs that are hidden among the various categories of the Standard Industrial Classification structure: those employed in government transportation services; and those who produce the new equipment, chemicals, and processes to be used in the mills." (8)

The "hidden" jobs created from paper-based products and services can be shown by using "multipliers" adopted by federal economists.

The Commerce Department publishes multipliers for 79 major economic categories. If we apply the category multiplier to the number of jobs associated directly with each industry, we can then estimate the total national employment impact. (9)

In effect, a complete accounting shows that more than 9 million jobs in the United States rely directly and indirectly on paper-based products and services.

Jobs and Dollars

As of March 2003, there were 111,477,000 million full-time jobs held by individuals aged 20 and above. These individuals generated a gross domestic product (GDN) worth $10.586 trillion. In effect, to produce $1 billion in general economic activity required the services of 9,496 full-time, adult workers. (10) (11)

In the field of paper and communication, because of its size and national scope, the best measure of the relationship between jobs and dollars is the U.S. Postal Service. In fiscal 2002, the post office had revenues of $66.5 billion and employed 854,376 people. (12)

On average, 7,783 postal employees are required to produce $1 billion in postal revenues.

The job base and economic impact are not limited to direct employment opportunities, however. In 2001, for example, the Postal Service reports that it "made more than 38.7 thousand contractual actions (contract awards and modifications) worth more than $13.8 billion." (13)

In terms of additional jobs, if we use the same ratio of jobs-to-spending found in the Postal Service itself, that $13.8 billion represents an additional 107,405 civilian jobs nationwide (13.8 x 7,783 jobs per $1 billion in contract spending).

Looking at the total full-time, adult job base, there are 111,477,000 people at work nationwide in an economy that generated domestic goods and services worth $10.586 trillion in 2002. Each million workers can be seen as producing goods and services worth $94,961,292,464 ($10,586 trillion divided by 111.477 million).

Given 9,023,053 million jobs related to paper-based products and services, it means that nationwide jobs from paper and mail generate goods and services worth at least $856,840,774,815.

Geographic Distribution

Employment and economic activities related to paper-based products and services are universal. However, there are some communities where jobs from paper are concentrated. As examples, the Washington, D.C. metropolitan area is a communications and public relations hub, advertising is long associated with Madison Avenue, and forest products are a significant source of jobs in Washington and Oregon.

Alternatively, jobs from paper are so widely distributed that it's also useful to look at the averages. At the state level, there are an average of 180,461 paper-based jobs per state. Seen another way, there are an average of 20,743 jobs from paper-based products and services in each of the 435 congressional districts.

No less important, at a time when international competition is a serious concern in many fields, paper-based products and services can be seen as almost entirely domestic and not subject to migration overseas.

Methodology

The purpose of this study is to develop information which reflects general patterns of paper-based employment and economic impact. By their nature, such studies raise a series of implicit issues.

In the general case, outcomes can be influenced by such matters as the data selected and the assumptions employed. To reduce such distortions, a reasoned effort has been made to use data from sources not associated with the paper industry.

Another complexity is the fact that regional wage rates vary, thus $1 billion in economic activity may represent more employment in Alabama than Connecticut. While national averages show typical relationships between jobs and revenues, variations at the local and regional level should be expected.

Lastly, there is the reality that views among economists may vary even when looking at the same data. As Washington Post financial columnist James K. Glassman explains: "There's an old joke that economists have predicted 10 of the last three recessions." (14)

1. Taking Note Of The Paper Industry, Monthly Labor Review, September, 1997. p. 36.

2. Gates, Bill, The Road Ahead (New York: Penguin Books, 1996), p. 130.

3. Lancey, Stan. American Forest and Paper Association, April 18, 2003.

4. The Use of Checks and Other Noncash Payment Instruments in the United States, Federal Reserve Bulletin, August 2002

5. See: Annual Reports, U.S. Postal Service. Piece volume for fiscal years.

6. Taking Note Of The Paper Industry, Monthly Labor Review, September, 1997. p. 37.

7. Gladwell, Malcolm, The Social Life of Paper, The New Yorker, March 25, 2002, pages 92-96.

8. Taking Note Of The Paper Industry, Monthly Labor Review, September, 1997. p. 33.

9. There are 79 multiplier categories within the Industry by Commodity Total Requirements after Redefinitions maintained by the Bureau of Economic Affairs. This data was released December 27, 2002, for the year 1999 and is the latest available as of this writing.

The category designations related to paper-based products and services include:

• Paper (Category 24, "Paper and allied products, except containers"). Category 25, "Paperboard containers and boxes" has a higher multiplier (2.36496) than Category 24 (2.19954). We have used the more conservative figure.
• Printing (Category 26B, "Other Printing and Publishing). Does not include newspapers and periodicals (Category 26A).
• Postal Service (Category 78, "Federal government enterprises").
• Delivery Services (Category 78, "Federal government enterprises"). The multiplier used for the Postal Service is most appropriate for parallel services in the private sector.
• Editorial (Category 66, "Communications except radio and TV").
• Communications (Category 73D, "Advertising").
• Forestry & Logging (Category 3, "Forestry and fishery products").
• Libraries (Category 79, "State and local government enterprises").

For detailed job categories, please see the accompanying table and notes.

10. A total of 111,477,000 full-time employees was determined by adding figures from the Bureau of Labor Statistics for 64,305,000 men and 47,172,000 women aged 20 and above who work full-time.

11. Gross Domestic Product: Fourth Quarter 2002 (Preliminary), Bureau of Economic Analysis, Department of Commerce, February 28, 2003.

12. 2002 Annual Report, U.S. Postal Service

13. 2001 Comprehensive Statement on Postal Operations, United States Postal Service. See: Chapter I, Compliance with Statutory Policies, Section 4A.

14. James K. Glassman, Heading for Recession, The Washington Post, August 4, 1997, p. A15.

Note: This material prepared originally for the PaperCom Alliance in 1998. Updated by the Association for Postal Commerce (PostCom) in 2001 and the American Forest & Paper Association in 2004.