Cosmetics Do a Whole Lotta Good

Beauty is more than skin deep…much deeper. The beauty industry packs an economic, environmental and philanthropic punch, according to a new study by Pricewaterhouse. During the opening session of the annual meeting of the Personal Care Product Council in Boca Raton, FL, PricewaterhouseCoopers professionals Susan McPartlin and John Stell presented highlights from their study on the economic impact and social contributions of personal care products companies.

Results showed that the industry contributed significantly to sustainable economic growth by providing job opportunities for millions of Americans— particularly women and minorities, developing small businesses, enhancing trade opportunities, making considerable charitable contributions, and being environmentally responsible.

According to the study, which is based on federal government statistics, the personal care products industry is directly responsible for creating nearly 2.8 million U.S. jobs, and contributing $189 billion to U.S. GDP. Alternative measures suggest the numbers could be higher. For example, individuals in the direct selling segment of the industry, who are not included in government data, could add another 3.2 million to the total. Also, state governments licensed 2.2 million cosmetologists and nail technicians in 2007.

The study also demonstrated that personal care product manufacturers, overall, are less energy-intensive compared to other manufacturers.Key highlights from the study include:

Industry Employment Diversity is Strong: Women comprise 66% of the industry workforce, compared to 48% of the workforce for all industries. Minorities represent a higher share overall and in management (35% and 19%, respectively) than the economy in general (34% and 18%, respectively).

Industry Generates Significant Trade Surplus: Industry generated a trade surplus of $5 billion in 2008 compared to a trade deficit of $819 billion for the economy as a whole.

Industry Charitable Contributions High: Industry philanthropic contributions exceeded those of other industries by more than 60%. For every $1 million personal care product manufacturers received, they made charitable contributions of approximately $1,400, compared to an average of $539 across other industries.

Industry Fosters Small Businesses: Companies with fewer than 10 employees account for 72% of the industry’s employment, while companies with less than 50 employees account for 92%.

Industry Increases R&D Spending: Personal care product manufacturers increased research and development spending at a 5.6% avg. annual rate from ’97-’07.