Activities of U.S. Affiliates of Foreign Multinational Enterprises in 2018
The Bureau of Economic Analysis (BEA) recently released statistics on the 2018 activities of U.S. affiliates of foreign multinational enterprises (MNEs). These statistics provide a picture of the overall activities of U.S. affiliates of foreign parents and contain a wide variety of indicators of their financial structure and operations. The statistics cover items that are needed to analyze the characteristics, performance, and economic impact of foreign-owned businesses on the U.S. economy and are obtained from mandatory surveys of U.S. affiliates conducted by BEA.
The following charts present highlights of BEA’s U.S. affiliate statistics for 2018. Much more detail, including additional data items, can be found on BEA’s website.
- MOUSAs of foreign MNEs employed 7.8 million workers in the United States in 2018, 1.9 percent more than in 2017.
- MOUSAs accounted for 6.0 percent of total private-industry employment in the United States.
- The manufacturing sector accounted for 36 percent of MOUSA employment. Within manufacturing, transportation equipment employed the most workers, followed by chemicals and food.
- Within other industries, accommodation and food services, along with administration, support, and waste management, employed the most workers.
- The countries of UBO that accounted for the largest share of MOUSA employment were the United Kingdom, Japan, Germany, Canada, and France. These five countries accounted for 60 percent of all MOUSA employment.
- By state, private-industry employment accounted for by MOUSAs was highest in South Carolina (8.8 percent), Kentucky (8.4 percent), and Michigan (8.2 percent). In all three states, MOUSAs in the manufacturing industry employed the most workers.
- Current-dollar value added of MOUSAs increased 8.4 percent to $1.1 trillion.
- MOUSAs accounted for 7.1 percent of total U.S. business-sector value added.
- Manufacturing accounted for most of MOUSA value added. The largest industry within manufacturing was chemicals (which includes pharmaceuticals), followed by transportation equipment.
- Other industries and finance and insurance were the next largest contributors to MOUSA value added.
- The countries of UBO that accounted for the largest share of MOUSA value added were the United Kingdom, Japan, Germany, Canada, and France. As was the case for employment, these five countries accounted for 60 percent of all MOUSA value added.
Property, Plant, and Equipment3
- Expenditures for property, plant, and equipment (PP&E) by MOUSAs increased 4.0 percent to $277.4 billion. By industry, there were significant offsetting increases and decreases.
- MOUSAs accounted for 16.3 percent of total U.S. private business capital expenditures.
- Manufacturing and wholesale trade accounted for most of MOUSA PP&E expenditures. Within manufacturing, the largest contributor was transportation equipment, followed by chemicals.
- Within other industries, utilities and mining accounted for the largest shares.
- The countries of UBO that accounted for the largest MOUSA PP&E expenditures were Japan, Germany, the United Kingdom, Canada, and the Netherlands. PP&E expenditures are more concentrated by country than employment and value added, with the top five countries of UBO accounting for 67 percent of MOUSA PP&E expenditures.
- The preceding charts illustrate PP&E expenditures. BEA also collects detail on gross PP&E stock, which is the value of all land, property, plant, and equipment before accumulated depreciation. These data can be used as a proxy for state-level foreign direct investment levels that are not available in BEA's direct investment position statistics.
- Total gross PP&E for the United States was $2.7 trillion. The states with the largest share of MOUSA gross PP&E were Texas ($458 billion), California ($208 billion), and New York ($188 billion).
Research and Development4
- Research and development (R&D) performed by MOUSAs increased 6.6 percent to $66.9 billion.
- MOUSAs accounted for 15.2 percent of total U.S. business R&D, larger than the MOUSA share of employment or value added.
- Manufacturing made up the overwhelming bulk of all MOUSA R&D performed, accounting for 71 percent of total R&D. Chemicals manufacturing (which includes pharmaceuticals) accounted for most of MOUSA manufacturing R&D.
- The countries of UBO that accounted for the largest MOUSA R&D performed were Japan, Germany, Switzerland, the United Kingdom, and the Netherlands. The top five countries of UBO accounted for 64 percent of MOUSA R&D.
- Employment covers the total number of full-time and part-time employees on the payroll at the end of the year.
- Value added is the value of the final goods and services produced by a firm’s labor and property. Value added represents the firm’s contribution to U.S. gross domestic product.
- Expenditures for property, plant, and equipment cover expenditures for land and depreciable structures and equipment.
- Research and development (R&D) performed includes expenditures for R&D performed by the U.S. affiliate, whether the R&D was for their own use or for use by others.