Economic Impact of Coal Industry

Table 12: Estimated Direct Impact -Coal Mining Industry, 2018 Industry Output $2,216,936,053 Payroll $347,864,566 Employment 2,578 Supplier Output $249,073,846 Payroll $76,471,314 Employment 883 Table 13: Estimated Direct Impact – Coal Mining Suppliers, 2018 The overall direct impact (Industry and Suppliers) is presented in Table 14. It is our estimate that direct output of the coal mining in Alabama stands at $2.5 billion in 2018. Its reported direct payroll and employment are estimated at $424 million and 3,461 FTE employment. Output $2,466,009,899 Payroll $424,335,880 Employment 3,461 Table 14: Estimated Direct Impact -Coal Mining Industry & Suppliers, 2018 In order to estimate the total economic impact of the coal industry on the state’s economy, the direct economic attributes of the Industry (Table 14) were used in conjunction with an economic model of Alabama. The model used in this study is constructed by estimating the economic and industrial relationships between different industrial sectors of Alabama using the information collected from the U.S. Department of Labor, the U.S. Census Bureau, the U.S. Bureau of Economic Analysis, the Alabama Department of Industrial Relations, the Alabama Department of Revenue, and the Alabama Department of Finance. More specifically, the industrial inter-relationship in Alabama was constructed using input-output technical multipliers obtained from the U.S. Bureau of Economic Analysis. Furthermore, this information was then linked to demographic and labor force data to establish the link among industrial investments, production, and the resource market in Alabama. Next an income module (circular flow type model) was estimated. This module incorporates the information in the first two modules into income and earning creation mechanism for the Alabama economy. Finally, the income and earnings data were then linked to potential tax revenue collections through a series of income elasticity of various tax sources. Every attempt was made to estimate the elasticity ratios for all the tax sources. Employment and payroll information was used to estimate the coal industry value added. The value-added estimate was then subjected to detailed inter-industrial multiplier analysis. In general, this model produces the following economic impact statistics: • Output impact • Employment impact • Earning impact 16 ECONOMIC IMPACT OF THE COAL INDUSTRY ON THE STATE OF ALABAMA