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Adding customs officers could boost GDP

USC (US) — A new customs and border protections officer at each of 33 selected land and airport locations could add $61.8 million to the US economy.

This step could also add 1,053 jobs in the US, according to a study released today by the National Center for Risk and Economic Analysis of Terrorism Events (CREATE).

The new research estimates the impacts of wait times at major ports of entry on the US economy due to changes in customs and border officers staffing.

“We estimate that every additional officer, if placed at ports of entry with high traffic volume would, on average, lead to 33 additional jobs being stimulated indirectly in the US economy,” says Adam Rose, principal investigator of the study and Professor of Public Policy at the University of Southern California’s Sol Price School of Public Policy.

He also notes this outcome is not a standard “multiplier,” which pertains to ordinary economic activity, but instead refers to the gains from alleviating potential bottlenecks at peak times.

Inspection of people and vehicles at US border crossings is vital to homeland security. The benefits of these activities include the avoided losses in terms of lives, property, and economic activity resulting from a terrorist attack.

However, inspections, which are part of US Customs and Border Protection’s mission of enforcing hundreds of US laws, generate various spillover effects relating to the delays in the flows of passengers and cargo across US borders.

On the passenger side, delays decrease the amount of tourism and business travel into the country, and thus an associated loss of spending stimulus. On the freight side, delays translate into increases in various explicit transportation costs, such as additional fuel. Implicit costs such as the value of lost time impact both.

Reducing wait times for passenger vehicles and trucks at land-based US ports of entry and for airline passengers at US airports, through the addition of customs and border officers, will reduce these negative spillover effects and generate a significant savings to the US economy.

In turn, reduced wait times at land crossings increase the number of visitors from Canada and Mexico, whose spending stimulates the US economy. Also, the reduction in wait times results in lower transportation costs, which makes goods imported from Canada and Mexico cheaper.

This not only expands trade from these countries, but helps US companies who use these goods as inputs into their manufacturing processes increase the competitiveness of US exports worldwide.

Operations research and economic analysis methods were used to translate changes in security expenditures into changes in wait times and then to changes in travel demand, business transportation costs and to the value of an individual’s time.

CREATE was established in 2004 as a Department of Homeland Security Center of Excellence and is funded by the DHS Science and Technology Directorate.

Source: USC

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