Measuring the size of the U.S. solid waste industry has never been as easy as stepping on a scale or whipping out a ruler — until now.

In the past, the availability of independent, authoritative, comprehensive and statistically defensible data has been limited because of the significant number of private and public sector players in the market and the wide range of services provided. But the Environmental Research and Education Foundation (EREF), Washington, D.C., in 1999, decided to find these elusive numbers and contracted R.W. Beck Inc. (Beck), Orlando, Fla., to tackle the task.

The research took nearly 18 months. But by April 2001, Beck defined the waste industry by revenues, employment, quantities of solid waste managed and other industry statistics.

Defining the Industry

For the study, solid waste included any non-hazardous waste sent off-site for final disposal, incineration, recycling or composting. Nonhazardous waste included household waste; commercial, business or institutional (CBI) waste; special waste; construction and demolition (C&D) debris; regulated medical waste; yard waste; sludge; and scrap tires.

All organizations engaged in the collection, disposal, recycling, incineration, composting or other solid waste processing were considered part of the industry, which was divided into three business sectors:

  • Publicly Traded Companies

    Private sector companies that issue stock currently traded on a national stock exchange;

  • Privately Held Companies

    All remaining private sector companies other than those whose stocks are publicly traded; and

  • Public Sector

    Municipalities (i.e., towns, cities and counties) and municipally established solid waste districts and regional authorities.

  • To accurately collect data, Beck developed two surveys. One targeted corporate headquarters or administrative offices of solid waste industry organizations that acquired information on revenues, employment, compensation, total facilities and other company-wide data. The other was targeted specific facilities to obtain operational data such as waste quantities and equipment use.

    Because of the vast number of business entities (more than 50,000) and facilities (more than 26,000) involved in the U.S. solid waste industry, census-type data collection was not practical or cost-effective. Instead, Beck used statistical sampling that allowed representative data to be obtained from a randomly selected population subset. The results, therefore, are mean estimates based on an 85 percent or better confidence level for data collected in 1999.

    The Numbers Revealed

    Based on its sample, Beck found an estimated 27,028 organizations operating in the U.S. solid waste management industry. Almost 56 percent of these were public sector entities, and 44 percent were private companies. Privately held companies accounted for almost all (99.8 percent) of the private companies, while only 0.2 percent were publicly traded.

    The industry employed some 367,800 employees [See “Distribution of Solid Waste Industry Employees” on page 60]. Private companies employed almost 75 percent (271,200 employees) of the total. Privately held companies employed 42 percent (151,700) of the employees, while publicly traded companies employed about 32 percent (119,500). The public sector employed approximately 26 percent (96,600) of the total.

    Earning Their Keep

    Beck found that the solid waste industry generated total revenues, net of intra-industry payments, of $43.3 billion in 1999. The private sector generated about three-fourths ($33 billion) of this amount. The publicly traded companies accounted for 47 percent ($20.6 billion) of the total, while privately held companies represented 29 percent ($12.4 billion). The public sector accounted for 24 percent ($10.3 billion) of the total revenues [See “Distribution of Solid Waste Industry Revenue” above].

    Total compensation paid to the 367,800 employees, including benefits, was estimated to be $10 billion [See “Financial Data for the Solid Waste Industry” on page 63]. Based on the data, solid waste industry employees were paid an average of $27,200 per year including benefits, which was 23.1 percent of net revenues.

    Publicly traded companies had the highest average compensation per employee ($36,000). Privately held companies had the lowest average compensation per employee ($17,100) because of the large number of small companies in the category.

    If large and small privately held companies were separated, the average compensation level was $40,600 for large companies and $14,100 for small companies. Large privately held and publicly traded companies typically paid the highest wages to retain qualified employees, although the reason for the finding was not apparent.

    Managing the Waste

    In 1999, there were a total of 27,028 private and pubic organizations actively involved in the U.S. solid waste industry, according to the study. Of the total, approximately 15,500 (57 percent) provided collection and hauling services only, and did not own or operate any facilities that dispose of or process solid waste. The remaining 11,500 organizations operated an estimated 15,700 solid waste management facilities in the U.S.

    The private sector owned 53 percent of the solid waste facilities and the public sector owned 47 percent. Of this, the publicly traded companies owned 12 percent and privately held companies own 41 percent [See “U.S. Solid Waste Facility Ownership” on page 61].

    In total, the U.S. solid waste industry managed approximately 545 million tons of waste in 1999. Of the total, about 374 million tons, or 68 percent, was landfilled; 31 million tons, or 5 percent, was incinerated; and 140 million tons, or 27 percent, was recycled [See “Estimated Amounts of Solid Waste Processed by Facility Type” above].

    The private sector handled 69 percent all the solid waste recycled, incinerated and landfilled, while the public sector handled 31 percent. Of the private sector waste, publicly traded companies managed 40 percent, and privately held companies managed 29 percent [See “Estimated Amounts of Solid Waste Managed by Business Sector” below].

    Tools of the Trade

    To manage this amount of waste, the industry used approximately 206,300 pieces of motorized equipment in 1999. Privately held companies owned the largest share (81 percent) of this equipment, with publicly traded companies owning 32 percent, and privately held companies owning 49 percent. The public sector owned 19 percent of the total.

    The majority (almost 72 percent) of all the equipment in the industry was used for collection. This included about 147,900 vehicles dedicated to collecting and transferring solid waste. The remainder of the vehicles included:

    U.S. Solid Waste Facility Ownership1
    Facility Type Publicly
    Traded
    Companies
    Privately
    Held
    Companies
    Public
    Sector
    Total Percent
    of Total
    MSW Landfills 700 400 2,100 3,200 20%
    C&D Landfills <502 200 400 600 4%
    Transfer Stations 400 500 2,200 3,100 20%
    Incinerators/WTE3 40 30 70 140 1%
    MRFs 600 1,700 1,200 3,500 22%
    Compost Facilities <502 200 1,400 1,600 10%
    Other Facilities 100 3,400 100 3,600 23%
    Total 1,840 6,430 7,470 15,740 w
    Percent of Total 12% 41% 47% 100%
    1. Estimates rounded to the nearest 100 except for Incinerators/WTE, which is rounded to 50
    2. Assumed to be zero for purposes of summation
    3. WTE = waste-to-energy facilities
  • Other mobile equipment, such as bulldozers, loaders, etc. — 26,000 pieces, or 13 percent, of the total;
  • Compaction equipment, such as landfill compactors, balers, etc. — 22,700 pieces, or 11 percent, of the total; and
  • Other processing equipment, such as tub grinders, shredders, etc. — 9,700 pieces, or 5 percent, of the total.
  • Economic Influence

    Beck also determined the solid waste industry's weight on the U.S. economy. The economic data were reported as direct (gross sales, jobs and income), indirect effects (value of additional economic demands that the direct firms or institutions place on supplying industries) and induced effects (when workers in the direct and indirect industries spend their personal earnings on goods and services).

    According to the study, the direct effects included the employment of 367,800 people and $43.3 billion in annual sales. This level of direct activity generated $10 billion in personal income. Taking into account all direct, indirect and induced effects, the industry had a total economic effect on the U.S. economy of 948,000 jobs, $29 billion in personal income and $96.5 billion in annual sales.

    Beck calculated these effects using a social accounting model (SAM) that estimated:

  • Total Industrial Output

    Gross sales for most private industries and public outlays for public institutions;

  • Personal Income

    Wages and salaries of employees, normal profits to sole proprietors, and an estimate of the cash value of all benefits;

  • Value-Added

    A measure of gross national product of the industry (personal income plus property incomes and indirect tax payments);

  • Jobs

    The number of positions in the economy; and

  • Tax flows

    The dollar value of tax revenues generated by the industry to public institutions.

  • Overall, the solid waste industry contributed more than $14 billion in direct and indirect taxes to federal, state and local governments. Of this, $8.9 billion was paid in federal taxes and $5.2 billion in state and local taxes. The industry accounted for roughly one-half of one percent of the U.S. gross domestic product (GDP).

    A Yardstick

    To date, Beck's findings represent the most comprehensive effort to define and compile meaningful and defensible U.S. waste industry data, encompassing both the public and private sector.

    The study suggests that organizations in the solid waste industry are significantly differentiated by size. Larger organizations, which typically perform more integrated waste management services, appear to have a significantly different financial and operational profile when compared with smaller industry participants, which typically perform one or two limited operations. This contributes to industry fragmentation, with many small organizations coexisting and a relatively small number of large or very large organizations.

    Waste management is a significant contributor to the nation's economy. The industry performs a vital public service by properly managing hundreds of million of tons of waste material annually.

    Furthermore, the industry provides employment opportunities for a large number of the nation's workforce; stimulates economic activity and jobs through its operation of thousands of large and small processing facilities; and stimulates the economy by purchasing tens of thousands of large pieces of motorized equipment and machinery on an annual basis. The solid waste industry also generates considerable tax revenues for federal, state and local governments.

    Edward W. Repa is director of environmental programs for the Washington, D.C.-based Environmental Research and Education Foundation.

    Financial Data for the Solid Waste Industry
    Sector Number of
    Organizations
    Annual Net
    Revenues
    ($ Billions)
    Number of
    Employees
    Employee
    Wages
    ($ Billions)
    Average
    Wages per
    Employee
    Publicly Traded Companies 28 $20.6 119,500 $4.3 $36,000
    Privately Held Companies 11,900 $12.4 151,700 $2.6 $17,100
    Public Sector 15,100 $10.3 96,600 $3.1 $32,100
    Mean Estimate 27,028 $43.3 367,800 $10.0 $27,200