Phila. ranks 9th in business exports, but lags in education exports

Only 1 percent of American businesses export. With U.S. exports growing to $2.11 trillion last year, it would seem to be a no-brainer way to grow the economy if more businesses did.

If only it were that simple, said Emilia Istrate, an associate fellow at the nonprofit think tank Brookings Institution.

In fact, surveys of small and medium-size businesses show that "fear of the unknown" is the major factor keeping more of them from exporting, Istrate said: "Exporting is seen as an adventure into the unknown."

With economic growth stuck in second gear in the United States since the 2007-09 recession, exporting may be one of the only ways for businesses to grow themselves.

Istrate is the lead author of the Brookings Institution's latest report on exports and U.S. metropolitan areas. You'll be happy to hear that Philadelphia is ranked ninth among the 100 largest metro areas, with exports valued at $26.6 billion in 2010. Los Angeles and New York headed the list, with $79.8 billion and $78 billion, respectively.

The biggest export category for the Philadelphia area is chemicals, which accounted for 20.9 percent of all exports from the metropolitan region, or $5.54 billion, in 2010. Within that sector, pharmaceuticals represented 51 percent of all exports, and the biggest markets for those medicines were Germany, at $398.1 million; the Netherlands, at $284.5 million; and the United Kingdom, at $277.9 million.

Given the footprint the pharmaceutical industry has had historically in the Philadelphia area, all that is to be expected. But with the industry continuing its cost-cutting, as well as bracing for billions of dollars in loss of revenue as onetime cash-cow products lose patent protection, it stands to reason this region's export leader may not experience much growth in the next five years.

According to Brookings' 40-page report, the Philadelphia region ranks fairly high in terms of jobs connected to its export activity. Researchers drew from various government databases to generate figures such as "direct export-production" jobs, which are tied to the metro area where the export is produced. At 97,000 jobs, Philadelphia ranked 10th of the 100 largest metro areas in 2010. New York was tops, with export sales supporting about 329,000 jobs. Los Angeles followed, with 312,700 jobs; Chicago was third, with 197,600 jobs.

A wider measure of export activity is "export-supported" jobs, which Brookings defines as export-production jobs plus positions supported by exports at the suppliers to the exporting industry. (Think trucking and warehouses.) Those jobs aren't necessarily in the Philadelphia region - this area ranked 10th by that measure, with 174,100 export-supported jobs in 2010.

As decent as those numbers are, here's what gave me pause: The Philadelphia region's exports as a percentage of metropolitan gross domestic product was just 8.5 percent in 2010 - good only for 71st among the 100 largest regions.

And though Philadelphia's export growth rate (in terms of dollars) grew by 7.7 percent from 2009 through 2010 compared with 4.6 percent from 2003 through 2008, that improvement barely nudged the region higher on the rankings. If you weren't cheered by being No. 90 in 2008, the new ranking of No. 86 won't float your boat.

There's more to exports than the planes, meds, and automobiles we typically associate with the activity. For example, education is an export. When a student from China or India comes to the University of Pennsylvania or Temple University, that counts as a service export for the Philadelphia region.

Interestingly, Philadelphia didn't crack the top 10 in terms of education exports as a share of all metro exports. Boston headed that list, with 4.8 percent of its exports coming from education. Madison, Wis., was second, with 4.4 percent, and Springfield, Mass., had 4.1 percent. Just 2.1 percent of Philadelphia's metro exports came from education.

Contact Mike Armstrong at 215-854-2980,, or @PhillyInc on Twitter. Read his blog, "PhillyInc," at