The Economic Impact of Uranium Mining in Texas

TOTAL DIRECT IMPACT The uranium mining industry's principal economic impacts on the Texas economy are the result of three flows of money from the industry into the remainder of the state's economy. These three are: (1) money paid to individuals (personal income) ; (2) money paid to other businesses (business income); and (3) money paid to state and local governments (government revenues). As these direct payments from the uranium industry to various other sectors of the Texas economy subsequently circulate and recirculate within the state, the indirect effects of uranium mining's direct impacts multiply to reach amounts significantly higher than the direct income flows alone. Over the past decade, the uranium mining industry has substantially increased its role as a provider of jobs, personal income, business income, and government revenues in Texas. The growth has come almost exclusively in a largely rural, seven-county area that lies within the triangle formed by the Laredo, San Antonio, and Corpus Christi metropolitan areas. The uranium mining industry, in fact, has been the major dynamic element in this rural area despite relative stagnation in most of the region's other basic economic sectors. Over the three years from 1976 to 1978, the South Texas uranium mining industry directly contributed a total of $115 million to the economy of the seven- county region in which it operated and $164 million to the economy of the entire state of Texas. In 1979 alone, the total direct contribution of the industry to the Texas economy had climbed to $124 million in personal, business, and government income. PERSONAL INCOME IMPACT In the period from 1976 through 1978, the South Texas uranium mining industry provided an average of $12.5 million in personal income each year directly to residents of Atascosa, Bee, Duval , Karnes, Live Oak, McMullen, and Webb counties -- the seven Texas' counties that make up the South Texas Uranium Belt. A1 though 84 percent of this resulted from the employment of area residents in uranium industry jobs, some amounts were also provided by the payment of rents and royalties to land owners for the use of their land and mineral rights in uranium mining operations. In 1979, the uranium industry provided approximately $38 million to residents of the Uranium Belt and the rest of Texas. This was more than double the average of $16.1 million provided to Texas residents during the 1976 to 1978 period. The full importance of the uranium industry as a source of personal income, however, should not be reckoned merely by the amount of wages and salaries that it pays directly to its own employees, nor by its rent and royalty payments paid directly to land and mineral rights owners living in Texas. The added payments that the industry makes directly to other Texas businesses and state and local governments in Texas are themselves converted into personal income as those business firms and government units in turn pay their employees. All of the direct income payments made by the uranium industry circulate and recirculate within the state's economy, multiplying their impact as they go, until they eventually all leak out of the state as federal taxes or as payments to individuals or businesses located outside of Texas. The combined circulation and recirculation of the direct personal, business, and government income that was provided by the-uranium industry in Texas during 1976, 1977, and 1978 resulted in an average annual amount of indirect personal income of more than $83 mill ion. This alone was $20 mill ion more than the industry's average annual sales during the same years. The total of combined direct and indirect personal income contributed to the Texas economy by the uranium mining industry in that same three-year period thus averaged almost $100 million annually. In 1979, the amount of indirect personal income contributed to the Texas economy by the circulation of uranium mining's direct contributions had risen to about $196 million, more than double the average of the previous three years. The combined direct and in- direct personal income impact in 1979 thus amounted to $234 million. BUSINESS INCOME IMPACT The income provided directly to other Texas business firms through the purchase of needed goods and services by the uranium industry has been twice as big as the industry's payrolls. In 1976, 1977, and 1978, the South Texas uranium industry spent an average of almost $36 million each year to buy both goods and services from other Texas businesses. By 1979, this direct contribution to the Texas economy had swollen to $76 million. The biggest share of the uranium industry's payments to other businesses have gone to contracting firms, including both construction firms and those providing specialized mining services. In the past four years, about 40 percent of the direct payments made by Texas uranium producers to other Texas firms have been to contractors. Texas wholesale and retail firms have also shared in the business sales provided by the South Texas uranium mining industry. Over the past four years, Texas wholesale and retail trade businesses have accounted for about 34 percent of the uranium mining industry's purchases from other Texas businesses. Public utilities firms have received another six per- cent, while Texas manufacturers and transportation firms have accounted for about five percent each. The other sectors of the state's economy, including other mineral industries, agriculture, finance, insurance, real estate, and services, have accounted