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Recycling Economic Information (REI) Report

The Recycling Economic Information (REI) Report aims to increase the understanding of the economic implications of material reuse and recycling. Recycling is a critical part of the U.S. economy – contributing to jobs, wages and government tax revenue. Recycling has been an important component of the Environmental Protection Agency’s (EPA) decades-long efforts to implement the Resource Conservation and Recovery Act (RCRA) and its more recent efforts to pursue a Sustainable Materials Management (SMM) approach, which aims to reduce the environmental impacts of materials across their lifecycle. EPA’s SMM program provides data, information, guidelines, tools and technical assistance on resource conservation, recycling, resource recovery, waste reduction and landfilling issues.

Recycling also conserves resources and protects the environment. Environmental benefits include reducing the amount of waste sent to landfills and combustion facilities; conserving natural resources, such as timber, water and minerals; and preventing pollution by reducing the need to collect new raw materials. Economic and community benefits include increasing economic security by tapping a domestic source of materials, supporting American manufacturing and creating jobs in the recycling and manufacturing industries.

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Background on the REI Report

In 2001, to encourage the development of an economic market for recycling, EPA supported the creation of a national Recycling Economic Information (REI) Project and the related REI report, based upon the work of several states and regions. Compiled through a cooperative agreement with the National Recycling Coalition, the study confirmed what many have known for decades: there are significant economic benefits in recycling.

EPA updated the 2001 REI Study in 2016 with a new analytical framework for estimating the broader environmental and economic impacts associated with recycling. Based on 2007 input-output data maintained by the Bureau of Economic Analysis (BEA), the 2016 Report developed a Waste Input-Output (WIO) model designed to capture the flow of material inputs and outputs, as well as the flow of goods and wastes. It also covered the economic activities of nine sectors: ferrous metals, nonferrous metals (aluminum), glass, paper, plastics, rubber, construction and demolition (C&D), electronics and organics (including food and yard trimmings). Finally, the 2016 study  incorporated the notion of material transformation into the definition of recycling, allowing the model to capture the process influence from refurbishing or remanufacturing of goods, providing a more realistic scope of the entire process.

The 2020 REI Report builds off its 2016 predecessor by presenting updated results for the nine material categories using the same WIO model, based on 2012 BEA data. The report estimates changes in recycling’s total economic impacts, including wages, employment and tax revenue generated to support recycling activities as an aggregate and for each material. In addition, it provides a comparison of the results between the updated model and the 2016 version.

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Key Findings of the 2020 REI Report

The 2020 REI Report includes updated information about the number of recycling jobs, wages and tax revenue. The report shows that recycling and reuse of materials creates jobs, while also generating local and state tax revenues. In 2012, recycling and reuse activities in the United States accounted for:

  • 681,000 jobs
  • $37.8 billion in wages; and
  • $5.5 billion in tax revenues

This equates to 1.17 jobs for every 1,000 tons of materials recycled. The ferrous metals industry provides the largest contribution to all three categories (job, wage, and tax revenue), followed by construction and demolition (C&D) and non-ferrous metals such as aluminum.

The 2020 REI Report uses an analytical framework and a Waste Input-Output methodology, which focused on the life cycle of materials. These were developed with the 2016 REI Study and updated with the most recent iteration of the report. This methodology will assist decision makers and researchers in more accurately estimating the economic benefits of recycling and create a foundation upon which additional studies can be built.

Jobs, Wages and Tax Revenues due to Recycling
Jobs, Wages and Tax Revenues due to Recycling

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Frequent Questions

1. What is the significance of the 2020 REI Report?

Recycling conserves natural resources, strengthens our economy and creates jobs. Recycling is an essential part of Sustainable Materials Management (SMM), an approach that emphasizes the productive and sustainable use of materials across their entire life cycle, while minimizing their environmental impacts. The 2020 REI Report builds off an analytical framework that was developed with the 2016 REI Study, which focuses on SMM. The 2020 REI Report covers the economic activities of nine sectors: ferrous metals, nonferrous metals (aluminum), glass, paper, plastics, rubber, construction and demolition (C&D), electronics and organics (including food and yard trimmings).

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2. What is the significance of the report's title?

The 2020 Recycling Economic Information (REI) Report builds on the work from the 2001 and 2016 REI studies. The report focuses on the economic impacts of recycling rather than the environmental benefits, as the environmental benefits have been researched in detail. Accurately estimating the impact that recycling has on jobs, wages and taxes is important because the results can influence policy decisions and provide a more robust picture of recycling by adding an economic layer on top of the more heavily researched environmental impacts of recycling.

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3. How does the REI report approach recycling?

The REI report approaches recycling as the recovery of materials, such as paper, glass, plastic, metals, construction and demolition (C&D) material and organics from the waste stream (e.g., municipal solid waste), along with the transformation of materials, to make new products and reduce the amount of virgin raw materials needed to meet consumer demands. The 2020 REI Report identifies nine materials and investigates their direct and indirect impact on jobs, wages and taxes.

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4. How does the report relate to Sustainable Materials Management (SMM)?

SMM refers to the use and reuse of materials in the most productive and sustainable way across their entire life cycle. On a broader scale, SMM examines social, environmental and economic factors, each playing a critical role, to get a more holistic view of the entire system. The benefits of maximizing this connection include conserving resources, reducing waste, slowing climate change and minimizing the environmental impacts of the materials we use. Since the third key element to SMM is economics, it was important to update the REI Report to provide an economic and systemic view of recycling.

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5. What are the main outcomes and takeaways of the report?

The 2020 REI Report reiterates that recycling and recycled products play an important role in our economy and have significant positive impacts on jobs, wages and tax collections.

  Gross Totals Economic Share
Recycling and Reuse Activities in 2012
Jobs Accounted for 681,000 jobs 0.47% of the U.S. economy
Wages Produced $37.8 billion in wages 0.58% of the U.S. economy
Taxes Produced $5.5 billion in tax revenues 0.78% of the U.S. economy

On a national average, there are 1.17 jobs, $65,230 wages and $9,420 tax revenues attributable, for every 1,000 (US) tons of recyclables collected and recycled.

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6. What was the methodology behind the 2020 REI Report and how does an input-output model work?

EPA developed a waste input-output (WIO) model to provide an improved analytical framework for better understanding the contributions of recycling to the U.S. economy. Instead of examining the job codes within the context of an I-O model, the 2020 REI Report focuses on nine material categories and follows the flow of materials through the WIO model. By focusing on material categories, the model identifies direct impacts of recycling on jobs, wages and taxes and then upstream indirect impacts. The WIO model builds on the official U.S. input-output (I-O) tables maintained by the Bureau of Economic Analysis (BEA). These tables describe the economic transactions between industries in the U.S. and are used to formulate U.S. monetary and fiscal policy. Using the I-O tables as the starting point, the WIO model adds information about recyclable and recycled material flows in the U.S., and information about employment and local, state and federal tax revenue. Combining this information with the detailed statistics regarding economic transactions enables the estimation of the economic activity attributable to recycling.

For more specific information about the methodology (including examples) please see the methodology paper Chapter 3: Summary of the WIO Model Methodology

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7. Which methodological approach was used to provide the statistics and metrics?

The "direct and indirect production of recycling", also called the total impacts approach in the methodology document, was chosen to communicate the results of the study.
The total impacts approach accounted for not only direct, but also upstream supply chain economic activity attributable to recycling processes. In addition to the total impacts approach, three other approaches were analyzed and are explained in detail in the methodology document.

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8. What are the data sources for the report?

The key data sources for this report include industry outreach, existing reports (including government, industry and other publicly available reports) and life cycle inventory datasets. Below is a list of organizations and industry associations involved in the data sourcing for this report:

Material Organization/Industry Association
Ferrous Metals
  • Facts and Figures
  • Tellus Institute
  • United States Geological Survey (USGS)
Nonferrous Metals
  • The Aluminum Association
  • USGS
Plastic
  • American Chemistry Council (ACC)
  • The Association of Postconsumer Plastic Recyclers (APR)
  • Facts and Figures
  • National Association for PET Container Resources (NAPCOR)
  • REI Report 2016
Rubber
  • Facts and Figures
  • National Asphalt Paving Association (NAPA) 2017
  • U.S. Tire Manufacturers Association
Glass
  • Facts and Figures
  • Glass Packaging Institute (GPI)
  • U.S. International Trade Commission (USITC)
Paper
  • American Forest & Paper Association (AF&PA)
  • Recycling Economic Impact (REI) Report 2016
Construction & Demolition
  • Facts and Figures
  • NAPA
Electronics
  • Facts and Figures
  • REI Report 2016
Organics
  • Facts and Figures
  • REI Report 2016

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9. How does the 2020 REI Report differ from the 2016 REI Report?

The differences between the 2020 REI Report and the 2016 REI Report are primarily in the base years of data and recycling trends. Detailed benchmark input-output statistics from BEA, which serve as the source data for REI reports, come out roughly every five years; as such, the 2016 study used a base year of 2007, while the 2020 study uses a base year of 2012. Furthermore, there were changes to the REI modeling methods for estimating recycling process inputs, which can result in substantial changes in total impacts. In this case, the recycling process inputs data for plastics and C&D recycling are estimated from publicly available process-based life cycle assessment data sources, and thus may reflect a difference in scope compared to the 2007 model.

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10. Does this report include "pre-use" or recycling materials that are reused within the manufacturing sector?

No. “Pre-use” or recycled materials that are reused within the manufacturing sector were not included primarily due to a lack of data.

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