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Stubborn Facts: The Gun Industry Employs Twice as Many Americans as GM (and That’s Just the Beginning)
This article is part of a series on Guns in America that explores the use of firearms in our country and the debate over gun control. This is an editorially independent series sponsored by Tactical Firearms Training Secrets.
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Guns are big business in America – so
big, in fact, that despite making vastly more firearms than any other
nation, the U.S. also is the largest importer of handguns, rifles and
shotguns.
Demand is so high, that on top of the
6.54 million pistols, revolvers, rifles, shotguns and other firearms
made in America in 2011, an additional 3.25 million were brought in from
other countries, according to records of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. Domestic production grew by 1 million guns from the 2010 volume and imports increased by half a million.
All told, the firearms industry
contributes more than $33 billion to the U.S. economy and supports about
220,000 jobs, according to the National Shooting Sports Foundation. That’s more than double the North American payrolls of General Motors, which President Barack Obama called “a pillar of our economy” when he explained the decision to provide more taxpayer aid to help save the car maker in 2009.
Unlike GM, which employs
101,000 people in North America and 213,000 worldwide, the gun business
is divided up among thousands of little companies with just a few big,
recognizable brands like Ruger, Smith & Wesson and Remington. Big or
small, companies making and selling firearms and ammunition provide
jobs in every state. (Click here for a snapshot of the top U.S. gunmakers.)
In Idaho, for example, Republican Gov.
Butch Otter considers the firearms business “an important piece of the
economy” in his state, which is home to one of the largest U.S.
ammunition manufacturers — ATK Sporting — and has been attracting
gun-related businesses away from other states that have enacted stricter
gun controls or raised corporate taxes. Idaho’s firearms businesses
generate $512.7 million in revenue and provide 3,116 jobs in the state,
according to the NSSF.
“Our idea of gun control in Idaho is
to use two hands,” Otter joked during an interview with TheBlaze. “The
gun industry doesn’t need to be afraid of Idaho.”
Still, politicians in states such as New York, which recently passed what Democratic Gov. Andrew Cuomo called “the toughest gun laws in the nation,” often make a distinction between support for gun control and opposition to firearms businesses and gun owners.
Cuomo has said
he doesn’t think New York’s new laws will have a “significant impact”
on Remington Arms, which was founded in Ilion, New York, and he has
stated several times that the gun control measures he signed into law
this year are “not about hunters, sportsmen or legal owners who use their guns appropriately.”
The NSSF estimates that New York-based
firearms businesses contribute more than $1.2 billion to the economy
and employ almost 8,000 New Yorkers — jobs the state has fought to
protect with $5.5 million in subsidies and grants since 2007, according
to the Maine Center for Public Interest Reporting. Those subsidies were approved prior to Cuomo taking office last year.
As other states consider following New
York’s lead on gun control and the U.S. Congress debates stricter
federal measures following the Sandy Hook Elementary School massacre in
Newtown, Connecticut, the desire to prevent such tragedies will have to
be weighed against the popularity of firearms among Americans and the
potential impact on an industry that has been growing steadily, even
through the recent recession.
Creating Jobs
The number of employees in the gun
industry grew by more than 10% from 2008 to 2010, adding about 17,000
jobs, according to the NSSF. During the same period, the overall number
of Americans with jobs declined roughly 6%.
The economic value created by the
firearms industry also is increasing steadily, from $19.2 billion in
2008 to $27.6 billion in 2010 and reaching a record $33 billion last
year, according to NSSF calculations based on wages and salaries.
Federal and state governments also
benefit directly from the $5 billion in tax revenues the industry
provides, including $2.54 billion in business taxes and $460 million in
excise taxes to the federal government, plus $2.1 million in state
business taxes, according to the NSSF.
The following chart shows the 10 states with the most jobs and revenue from the firearms industry:
ECONOMIC CONTRIBUTION OF ARMS & AMMUNITION INDUSTRIES, 2011 |
|||||
State | Jobs |
Avg Wages | Total Wages | Output | Fed Excise Tax |
California | 24,022 | $51,134 | $1,228,358,565 | $3,798,233,534 | $58,216,101 |
Texas | 13,163 | $47,381 | $623,664,039 | $2,213,737,414 | $33,930,289 |
Connecticut | 8,275 | $65,592 | $542,772,009 | $1,819,043,262 | $27,880,752 |
Massachusetts | 8,399 | $62,679 | $526,456,218 | $1,702,731,196 | $26,098,019 |
Florida | 11,952 | $39,278 | $469,551,480 | $1,440,228,643 | $22,074,603 |
New York | 7,758 | $58,118 | $450,863,820 | $1,266,684,251 | $19,414,661 |
Oregon | 7,825 | $44,725 | $349,977,078 | $1,176,871,073 | $18,038,081 |
New Hampshire | 5,932 | $54,927 | $325,850,776 | $1,151,014,666 | $17,641,776 |
Illinois | 6,746 | $52,905 | $356,893,951 | $1,108,844,816 | $16,995,432 |
Pennsylvania | 7,353 | $46,624 | $342,844,737 | $1,089,080,524 | $16,692,502 |
Source: NSSF |
The economic value calculated by the NSSF doesn’t include sales of hunting and shooting accessories. A separate analysis by Congressional Sportsmen’s Foundation
found that America’s 37.4 million hunters and fishers spent $90 billion
in 2011 on equipment ranging from boats and bait to guns and land for
their sport of choice. Hunters and other sportsmen also have provided
nearly $1 billion in tax revenue that supports federal wildlife conservation programs.
Private citizens are the driving force
behind the booming gun business, with 47% of American adults
confirming in an October 2011 survey that they have a gun in their home
or elsewhere on their property — the highest level in two decades,
according Gallup.
Interest in hunting and shooting
sports is growing, especially among younger generations, according to
the National Shooting Sports Foundation, which estimates that sales of
firearms and ammunition for hunting and shooting sports rose to a record
$6 billion last year.
While dwarfed by mega-companies like
ExxonMobil, which generated more than $450 billion in revenue last year,
the sporting firearms industry’s revenue is on par with other members
of the Fortune 500,
including Hershey, Ryder and Avis. In terms of employment, the firearms
industry would rank 21st on the Fortune 500 list, one notch ahead of
GM, if all the independent gun-related businesses were rolled up into
one.
When looking just at the businesses
tracked by the ATF, America’s gun industry includes 5,441 firearms
makers, 1,895 manufacturers of ammunition, 48,676 dealers, 7,075 pawn
brokers, 59,227 collectors and 811 importers. Just looking at the
dealers, firearms outlets outnumber car dealerships almost 3 to 1 and
outnumber Starbucks stores by more than 4 to 1.
Small, Independent Businesses
The far-flung nature of the gun
industry obscures the role the industry plays in the economy, said Jake
McGuigan, the director of government relations for the National Shooting
Sports Foundation.
“There are a lot of smaller
manufacturers that support a very large base of suppliers,” McGuigan
said. “These kinds of small, independent businesses are really the
backbone of the U.S. economy, not the GMs, Wal-Marts and other big
businesses.”
The relatively small-scale operations
in the U.S. firearms industry are also highly sensitive to the
regulatory and economic landscape, as well as pressure from their loyal
customers who tend to be extremely opposed to increased gun control
measures, McGuigan added.
A 2011 ATF report
noted that the number of federally licensed firearms businesses dropped
by more than half from “a high of more than 286,000 in April 1993 to a
low of 102,020 in March 2000, likely due in part to the increase in
license fees and requirements to comply with state and local law
implemented in 1993 and 1994.”
The decrease occurred after the U.S.
Congress passed the Violent Crime Control and Law Enforcement Act of
1994 – the so-called federal assault weapons ban. Gun dealers saw the
biggest declines, falling to 48,676 by 2011 after peaking at 248,155 in
1992, according to the ATF.
Licensed ammunition manufacturers also started disappearing after 1994,
with 1,895 in 2011 compared with 6,068 in 1994 and a peak of 13,318 in
1983, ATF records from 1975-2011 show.
Through it all, however, the number of
firearms manufacturers kept growing, reflecting the strength of
consumer demand. After expanding by a hundred or more businesses each
year for most of the past three decades, the number of licensed firearms
manufacturers shot up in recent years to 5,441 in 2011 from 2,959 in
2009 and 2,144 in 2004, when the federal assault weapons ban expired.
Most Guns Made in U.S. Are Sold in U.S.
The disproportionate domestic demand
for guns is another key difference between the firearms industry and
many other American manufacturers.
Comparing again with GM, the carmaker
sells only about 30% of its vehicles in the United States, while just
about every gun made by a U.S. company is sold in America. Of the 6.54
million guns made in 2011 (up from 5.5 million in 2010), and only
296,888 were sold in export markets (up from 241,977 in 2010), ATF
records show.
In all, almost 9.4 million new guns
were sold in America in 2011 when domestic and imported firearms are
combined, an increase from 8 million in 2010. After adding in resales of
guns made in prior years, which the Small Arms Survey estimated at 1.5 million for 2010, the total number of guns sold in a given year gets close to 11 million.
The 25-year survey estimated that 2,228 U.S. companies produced more than 106 million firearms from 1986-2010.
Other highlights from the Small Arms Survey’s findings include:
- From 1980 to 2010 the industry went through severe business cycles, with reported production levels both declining and rising by 50 per cent within very short time periods, possibly posing severe challenges to the management of firearms firms.
- The majority of producers are relatively small in scale, with only a small percentage of firms—between 1.3 and 7.5 per cent, depending on firearms category—producing more than 100,000 weapons per year.
- Production of firearms for domestic, non-military use is highly cyclical, particularly for the pistol segment of the market, having oscillated between 3 million and 5.5 million firearms per year since 1980.
- The composition of the firearms supply sources has changed markedly. In 1989 about 80% of firearms came from domestic sources; this figure fell steadily to between 55% and 65% in the late 2000s.
Foreign Threats
While the domestic firearms industry
regained some ground lost to foreign competitors in recent years, the
volume of imported firearms remains near record levels, led by Brazil
with 846,610 firearms sold in the U.S. in 2011, followed by Austria
(522,638), Germany (313,528), Italy (254,901) and Russia (216,293),
according to ATF records.
Foreign-made firearms captured more
than 40% of new firearms sales in 2009, though the market share slipped
back to 34% in 2011 as domestic production ramped up.
When domestic and imported firearms
are combined, the supply of guns available for sale in the U.S. rose to a
ratio of 2.7 new firearms for every 100 people, compared with 2.7
firearms per 100 people in 2008 and 2.3 guns per 100 people in 1989,
according to the Small Arms Survey. When all of the roughly 270 million
existing guns are included, the ratio is closer to 90 firearms for every
person in America.
The kind of demand from the general
populace to support sales at those levels — along with the jobs, revenue
and taxes generated by the firearms industry — suggest to firearms
advocates like Idaho’s Gov. Otter that the push for new gun control laws
won’t destroy the firearms industry.
“I think it’s here to stay,” Otter said.
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Here are the other pieces in our ongoing Guns in America series (running every Tuesday) sponsored by Tactical Firearms Training Secrets:
- Guns At A Glance: The Top Commercial Firearms Makers in America
- How Many People Own Guns in America? And Is Gun Ownership Actually Declining?
- What Does History Say About When the Gov’t Tried to Restrict Guns in the Past?
- Being Shot Gave This Columbine Survivor Strong Views on Gun Control — Here’s Why He Opposes More Restrictions
- Should Second Amendment Be Taken Literally?
- History of Guns as Told Through Pictures
- Vietnam Vet Barred from Owning Guns Because of Teenage Misdemeanor 45 Years Ago
- Being Shot Gave This Columbine Survivor Strong Feels AGAINST Gun Control
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