Ethanol Industry Means Jobs for Wisconsin

Wisconsin would suffer significant job losses and a severe decline in economic activity if the tariff on foreign-subsidized ethanol is allowed to lapse at the end of the year. A study by the University of Missouri found that Wisconsin would loose 1,374 jobs the first year after the tariff lapses, 4,721 in the second year, and 6,972 in the third year. The year-to-year economic declines in Wisconsin would reach $307 million in the first year, $884 million in the second year, and $1.2 billion in the third year after the tariff lapses.

The study results were released by Growth Energy, the coalition of U.S. ethanol supporters. Earlier, Growth Energy endorsed legislation introduced by Reps. Earl Pomeroy of North Dakota and John Shimkus from Illinois, which would extend the tariff, as well as the tax credit for cellulosic ethanol production and the Volumetric Ethanol Excise Tax.

“Rural America would pay a steep price to remove the tariff on foreign-subsidized ethanol,” said Growth Energy CEO Tom Buis. This study shows it in stark details. We’d see billions of dollars and hundreds of thousands of jobs drain out of the America economy.”

Nationally, the study found year-to-year job losses go from 39,506 in the first year after the tariff lapses, to 115,624 in the second year, and 161,384 in the third year. Job losses continue year-after-year and most of these jobs are never regained, according to the 10-year projection performed by the University of Missouri’s Community Policy Analysis Center.

The study found that six states would see the largest declines in economic activity due to removal of the ethanol import tariff, including Iowa, Illinois, Nebraska, Minnesota, Indiana and South Dakota.

Meanwhile, a separate study conducted by IHS Global Insight predicted that without the tariff, Brazilian ethanol imports would climb to as high as 2 billion gallons a year, but displace domestic ethanol and virtually no oil. The Global Insight study also predicted a 24-month plunge in corn prices due to the decrease in domestic ethanol production.