#United States #Washington #US Economy #job growth #Advertising Coalition

Advertising's Impact on the US Economy

A recent comprehensive study from S&P Global Market Intelligence, commissioned by The Advertising Coalition, reveals the remarkable role advertising plays in the United States economy. The research indicates that advertising contributed an astonishing 20% to the total economic output of the country, supporting approximately 29 million jobs—almost one in five jobs in the nation. This amounts to an impressive $10.4 trillion in sales activity driven by advertising efforts in just one year.

Key Findings of the Study

The analysis, titled "The Economic Impact of Advertising on the US Economy," uncovered several jaw-dropping statistics about the advertising sector:

• - Advertising supported 18.3% of the total US workforce, translating to 29 million jobs out of 158.1 million total employment in the country.
• - The total spend on advertisements and the resulting stimulated sales amounted to $10.4 trillion, constituting 21.9% of the overall $47.5 trillion in US economic output.
• - Data showed that for every million dollars invested in advertising, 59 jobs were created across diverse industries.
• - The average salary for jobs supported by the advertising sector exceeded $93,000 annually, which is 26% higher than the overall national average.
• - Future estimates suggest that by 2029, advertising's economic influence will soar to a projected $12.7 trillion in sales activity, potentially supporting over 32 million jobs.

Bob Flanagan, Consulting Director at S&P Global Market Intelligence, emphasized the empirical nature of these findings: "Advertising is a robust catalyst that stimulates extensive economic activity across every state and sector of the US economy." This conclusion is grounded in comprehensive data models that traced how advertising fuels spending from both businesses and households, invigorating supply chain activities and enhancing consumption based on income.

The Reach of Advertising Across the States

The study's findings challenge the common perception that major advertising hubs, like New York and Los Angeles, are the sole beneficiaries of advertising revenue. Instead, the report illustrates that advertising generates significant economic benefits in all 50 states. For instance, states dominated by the Midwest like Illinois and Indiana, along with Southern states such as Alabama and Mississippi, showcased high percentages of jobs supported by advertising ranging from 14.1% to 19.7%.

Moreover, the report highlights that companies collectively spent roughly $491 billion on advertising in the past year, which directly catalyzed $3.5 trillion in sales and an additional $2.8 trillion in indirect sales through suppliers. Furthermore, employee spending resulting from these direct and indirect roles added another $3.6 trillion in sales activity.

Industry Reactions

The findings prompted strong responses from industry leaders:

• - Bob Liodice, CEO of the Association of National Advertisers, stated, "Advertising has been a driving force behind our nation's progress, prosperity, and growth for more than a century. These findings validate that advertising's benefits extend far beyond their impact on individual companies."
• - Justin Thomas-Copeland, CEO of 4As, reiterated the essential role of advertising agencies in fostering economic growth and innovation, underscoring the necessity of preserving the deductibility of advertising as a business expense.
• - Steve Pacheco, CEO of the American Advertising Federation, articulated the significance of advertising not just for major markets but for all regions across the country, highlighting its role as a vital communication tool for businesses.

The Advertising Coalition sees this research as a pivotal component in advocating for fair treatment regarding the tax deductibility of advertising—an issue vital to the continued strength and growth of the sector.

Conclusion

As we look forward, the advertising industry's potential to foster economic growth appears boundless. With anticipated rises in both sales activities and job support by 2029, it is evident that advertising remains a crucial driver of the US economy today and beyond.