| July 11, 2007 |  |
Raising Fuel Economy Standards: An Engine For Auto Industry & U.S. Job Growth
New Report Shows 23,900 New Auto Jobs And 241,000 Economy-Wide
WASHINGTON (July 11, 2007) – Increasing the average fuel economy of America's new autos to 35 miles per gallon (mpg) by 2018 would save consumers $61 billion at the gas pump and increase U.S. employment by 241,000 jobs in the year 2020, including 23,900 in the auto industry, according to a new analysis from the Union of Concerned Scientists (UCS). This study comes as the House of Representatives prepares to consider energy legislation in the coming weeks. This energy package could include debate over a bill introduced by Rep. Ed Markey (D-Mass.) and Rep. Todd Platts (R-Penn.) that calls for increasing fuel economy standards by four percent per year, with guaranteed progress to 35 mpg by 2018.
"Putting technology to work means putting people to work, whether it's in the computer industry or the auto industry," said David Friedman, author of the study and research director of the Clean Vehicles Program at UCS. "A 35 mpg standard means billions of dollars helping to create more U.S. jobs, not lining the pockets of the oil industry and their overseas suppliers ," said Friedman.
According to the analysis, nearly $24 billion of the gasoline savings would become new revenue for automakers in 2020—paying for the improved technologies plus some profit. Consumers could then choose how to spend the remaining $37 billion saved on gasoline in that year. Shifting that money from the oil industry to more productive parts of the economy would generate 82,900 new jobs in the service industry; 44,400 jobs in the retail trade industry; 33,100 jobs in the finance, insurance, and real-estate industries; and 17,800 jobs in manufacturing industries outside the auto industry. Thousands of other jobs would be created in agriculture, construction, transportation, utilities, and government. Oil and associated industries would see their job forecasts drop by 21,000, though these jobs would be shifted to other sectors of the economy, yielding a net increase of 241,000 new jobs.
UCS used a macroeconomic model that includes industry-specific data derived from a government designed analysis tool to analyze the job impacts on 528 different economic sectors. Overall, states that use more gasoline and that have more industry will gain the most jobs. Seven states will add at least 10,000 jobs in 2020: California 32,500, Texas 14,700, Florida 14,300, New York 13,100, Michigan 11,000, Ohio 10,500, and Illinois 10,300 jobs.
Consumers are ahead of Congress in demanding more fuel efficient vehicles with lower emissions, consistently demonstrating support for higher fuel economy standards in national polls. Car dealers are already seeing a change in buying patterns.
"The least efficient pickups and SUVS that the Detroit 3 bet their - and my - future on are not selling," said Adam Lee, president of Lee Auto Malls, which sells eight brands of vehicles at 11 dealerships in Maine. "If we had a Jeep hybrid or a Ford Focus with a diesel hybrid, we would have customers lining up to buy one and I could continue to sell American cars."
"As the largest hybrid dealership in Maine, we sell foreign cars that get 45 to 60 mpg and pollute very little. They are more expensive than nonhybrids, but consumers are willing to pay for them. And as gasoline moves past $2.50 and $3 a gallon, those cars are becoming more economical and more popular," said Lee.
According to UCS analysis, putting fuel economy technology to work would also cut our oil addiction by 1.6 million barrels per day and reduce global warming pollution by more than 260 million metric tons, akin to taking nearly 40 million of today's average cars and trucks off the road in 2020.
"Our nation's top scientists and engineers have shown that cars and trucks could average 37 mpg by 2017 using conventional technologies in the toolbox of all automakers," Friedman said. "The least that Americans deserve is to lock in the modest target of a 35 mpg fleetwide average by 2018."
The Union of Concerned Scientists puts rigorous, independent science to work to solve our planet's most pressing problems. Joining with citizens across the country, we combine technical analysis and effective advocacy to create innovative, practical solutions for a healthy, safe, and sustainable future.
