How Exports are Fueling the U.S. Recovery
Exports represent a staggering 54% of GDP growth in the top 100 metropolitan areas in the United States. Traded sectors are key to high-quality economic growth. One tradable export job is the equivalent to three local jobs, and there are 5,690 jobs created per $1 billion in exports.
While the United States’ middle-class consumption has remained relatively steady since 2000 and is projected to remain stagnant, countries such as India and China are going to exponential growth in middle-class consumption.
Yet few firms are exporters. According to the International Trade Administration, a survey found:
- 4% of all U.S. employer firms export
- 58% of middle-market U.S. firms export
- 4% of middle-market U.S. firms are currently expanding overseas
- 58% of U.S. exporters sell to only one foreign market
In the Chicago MSA (Chicago-Naperville-Elgin, IL-IN-WI), many of the leading goods exports are growing strongly post-recession. In 2014, the total value of exports was $63.278 billion (rank: 4 of 381). This represents 11.3% of region’s GDP. In 2014, the number of export-supported jobs was 421,806 (rank: 3 of 381).
|Chicago-Naperville-Elgin, IL-IN-WI Exports Value (in millions)
|Misc. General Purpose Machinery
|Iron & Steel Products
|Engine & Power Equipment
|Petroleum & Coal Products
|Frieght & Port Services
|Food & Drink Services
|Management & Consulting
Source: Brookings Export Monitor 2015
Accelerating Exports, A Significant Opportunity for the Region
While the Chicago region is the nation’s 4th largest exporter at $63 billion in 2015, it ranks 166th in terms of intensity – export’s share of the region’s GDP. Only 6% of small- and mid-sized firms are exporting, and yet by 2050, 85% of the middle-class consumption will be in emerging markets.
Benefits for Regional Firms
- Manufacturers that export experience higher revenue growth (+37% vs. -7%; 2005-2009) and are more resilient to economic downturns.
- Business service exporters reported 100% higher sales and 20% higher wages.
- Exporting fosters innovative activity and enhances global competitiveness.
- The region is specialized in goods and service industries that are highly tradable and are projected to be in high demand in emerging markets.
Metro Chicago Exports
Metro Chicago Exports
represents a regional collaboration between the seven counties of Northeastern Illinois (Cook, DuPage, Kane, Kendall, Lake, McHenry, and Will) with the goal of increasing exports from small- to mid-sized enterprises (SMEs) and supporting regional job growth.
In May 2015, Metro Chicago Exports launched a Grant Program to help businesses grow in international trade, specifically through export initiatives. The $225,000 program, funded by JPMorgan Chase
, will award grants up to $5,000 to businesses throughout Northeastern Illinois. Eligible SMEs with an exportable product or service can apply for the grant to help take their business offering to the rest of the world.
“Small businesses are the core of our economy. Providing opportunities that help connect Chicago businesses and their products to the rest of the world offers tremendous opportunity to improve our global competitiveness,” said Thomas Hulseman, managing director of Metro Chicago Exports.
Metro Chicago Exports builds on the Global Cities Initiative, a joint project of the Brookings Institution and JPMorgan Chase, that aims to catalyze a shift in economic development priorities and practices resulting in more globally connected metropolitan areas and more sustainable economic growth.
The application period consists of two waves. The first wave deadline closed May 31, 2015 and the second wave deadline is July 31, 2015
. All eligible SMEs are encouraged to apply, but preference will be given to businesses in the following targeted industries:
Interested businesses can find additional information and apply online at www.metrochicagoexports.com.
- Metals – Fabricated Metal Products
- Equipment – Medical and Supplies
- Machinery – Engine and Power Equipment
- Plastics – General
- Computers and Electronics – Precision Instruments