New study points to jobs from Bellingham coal port

Three economists took a look and found a continuing increase in employment would follow from the proposed construction at Cherry Point.

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Three economists took a look and found a continuing increase in employment would follow from the proposed construction at Cherry Point.

Three Bellingham economists Thursday released research supporting a previous study commissioned by Gateway Pacific Terminal, estimating that a proposed new export terminal at Cherry Point north of Bellingham would employ up to 430 “direct” jobs and generate another 843 “indirect and induced” jobs when operating at full capacity.

Economists Jedidiah Brewer, David Nelson, and Hart Hodges produced the study for Terminal developer SSA Marine, and released the figures at a breakfast for about 100 people, sponsored by the Bellingham/Whatcom Chamber of Commerce, which has endorsed the terminal. The report comes as terminal sponsors are ramping up efforts to counter growing resistance in Bellingham to the terminal, which would primarily export coal, and to the resultant train traffic through the city. Several candidates in the Nov. 8 local election, in particular Mayor Dan Pike, have sharply criticized the coal exports. (The report and related documents were released in three files: here, here, and here.)

The local economists were hired by SSA Marine to examine a study done earlier this year by John C. Martin Associates of Lancaster, Pa., a consulting firm for maritime and airport clients, including the Port of Bellingham. They declared Martin’s data to be sound and, using a slightly different analysis program, came up with economic figures that SSA Marine will use in the future. Nelson and Hodges are on the economics faculty at Western Washington University.

At full capacity, Gateway Pacific would export some 48 million tons of coal a year, from the Powder River Basin in Wyoming, shipped via the BNSF Railroad to the terminal. Another 8 million tons might be added, perhaps from grain or potash. The coal exports would be the largest in the nation; Peabody Coal has contracted for the first 24 million tons if the project is built.

Community division over the terminal has largely been a matter of supporters stressing the economic impact of hundreds of jobs and the spinoff economic and tax benefits, versus concerns about a three-fold increase in the number of coal unit trains, air and water pollution, and the exporting of coal to fuel plants in Asia likely to contribute to climate change.

The major variable in economic studies is not the number of workers at the export terminal itself, which both Martin Associates and Finance and Resource Management Consultants Inc. of Bellingham put at 257, primarily longshoremen. Both studies then add to that number 173 additional “direct” jobs, such as railroad workers and crews on tugboats and ocean-going freighters. “Direct” jobs would average $94,900 annually, economists state.

Beyond these jobs, the two SSA economic studies used different formulas to come up with “indirect and induced” jobs — employment produced by terminal purchases in the community plus added employment and the effects in such areas as homebuilding, restaurant and bar workers, groceries, and other consumer-driven businesses. The Bellingham economists came in with estimates slightly higher than Martin Associates, so SSA Marine is using the average of the two: a total of 799 “indirect and induced” jobs, making a grand total of 1,229 jobs, producing annual income of $126 million.

The two studies differ significantly in terms of temporary jobs generated by the construction of the terminal, planned to be in two increments. Again, SSA Marine will use an average of 4,429 construction jobs per year for two years. Many of those jobs could be recruited in Whatcom County; some of the permanent jobs would be from outside the county or could be workers moving to the county.

In response to audience questions, the economists emphasized that they were not hired to look at negative impacts due to the terminal, only at the economic impact. Opponents have not generated studies examining impacts, particularly from additional rail traffic, that could detract from the terminal’s appeal; they expect an outside economic study during environmental reviews of the application. One of the more contentious issues as the application moves forward is whether added rail traffic through Washington communities will be studied or whether studies will be limited to the Cherry Point site.

While Washingtonians weigh in on the impacts of coal and rail traffic, the issue is increasingly moving beyond state borders. NPR aired a two-part series this week; in the Wednesday report discussing the Cherry Point issue, and on Thursday putting it into a global perspective. Last week, National Geographic Daily News highlighted the controversy.


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About the Authors & Contributors

Floyd McKay

Floyd McKay

Floyd J. McKay, professor of journalism emeritus at Western Washington University, was a print and broadcast journalist in Oregon for three decades.