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What's good for U.S. multinationals ...

Lobbyists for U.S. companies with sprawling operations overseas have spent months now trying to fend off higher taxes on foreign profits. Democrats say these firms are shipping jobs overseas and hurting American workers.

But according to a recent report by the McKinsey Global Institute (registration required), these companies pull more than their weight in contributing to the health of the country's economy. Three-quarters of U.S. real GDP growth since 2000 has been driven by these companies.

Says the report: "U.S. multinationals represent less than 1 percent of all U.S. companies, yet they contribute disproportionately to the U.S. economy's growth and health in many ways. U.S. multinationals accounted for 23 percent of U.S. private sector GDP (or value added) in 2007. However, they contributed 31 percent of the growth in real GDP and 41 percent of U.S. gains in labor productivity since 1990. U.S. multinationals' outsized contributions to productivity growth matter greatly because productivity increases have delivered nearly three-quarters of U.S. real GDP growth since 2000, with the rest coming from employment gains -- the reverse of the situation 30 years ago."

As you can see from the table below, they've contributed hugely to productivity, which juices companies' profits because they can make more money with less labor. But they've contributed only 11 percent of gains in employment.

multinationals.bmp

By Jia Lynn Yang  | September 27, 2010; 6:26 PM ET
 
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Comments

Turkey, population 75 million, average age 28, no bank or consumer debt. Booming. Turkey grew 10.3% year over year in Q2. Turkey is BIG time important for US growth. BIG TIME.

Posted by: betterdays1 | September 29, 2010 5:31 AM | Report abuse

Are the Lobbyists for U.S.multinationals going to understand that no job creation in the USA, means no more consumer spending? Guess they are looking to selling their products to China or India ......... right?

Of course I will not hold my breath, as these greedy people help collapse this country's economy.

Neither political party's "elected" officials seem to care for the U.S. citizens either ....... just for special interest.

Hope the "blow" up, when it comes is not too violent.

Posted by: bkarpus | September 29, 2010 8:27 AM | Report abuse

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