nav 2: job-losses-in-local-tobacco-industry
The tobacco industry claims that plain packaging will cause job losses in domestic tobacco manufacturing or packaging industries
This argument is used against all tobacco-control measures in those countries that have domestic tobacco production or manufacturing. However, overall economic benefits for a country in reducing smoking rates are huge and far outweigh any costs to the industry.
“President do not leave us unemployed - Senators protect Casablanca - bad tobacco law = 800 unemployed” ” A roadside bill board in Chile from May 2016 paid for by the tobacco industry opposing the Tobacco Control Bill which included provisions for plain packaging
BAT threatens to leave Chile: In 2015, BAT threatened to stop operations in Chile when the national legislature was considering a bill designed to strengthen tobacco-control measures, including plain packaging. 1 Movement on the bill stalled, but the company closed several factories anyway. However, BAT Chile maintains critical manufacturing facilities in the country. It exports cigarettes to seventeen countries around the world. 2 The decision to close some factories in Chile can be interpreted as a decision to consolidate based on cost efficiency and not on local tobacco-control laws.
In Canadain 1994–95:During the campaign for plain packaging, the specter of job losses in the tobacco growing, manufacturing, and packaging sectors was often raised by opponents. Representatives of both Ontario and Quebec growers stated that plain packaging would intensify price competition, causing tobacco firms to move their manufacturing facilities outside Canada. Plain packaging was dropped at that time, but most of the jobs in the tobacco industry were lost anyway. Imperial Tobacco moved all production to Mexico, tobacco-crop production has dropped 87% and tobacco packaging firms have downsized in Canada. 3
In the UK: A report commissioned by Philip Morris claimed that plain packaging would lead to between 2,000 and 3,500 jobs lost in the convenience retailing sector, thanks purely to the decrease in revenue through tobacco sales. It claimed a further 2,250 to 3,850 jobs were expected to be lost in the tobacco manufacturing sector, despite a rise in tobacco consumption. 4
In JTI’s submission the UK 2012 consultation, it argued that:
“Plain packaging will have a direct impact on investment, trade and jobs. JTI and other manufacturers support 5,700 jobs directly and 66,000 indirectly in the UK, and tobacco generates £12.1 billion in revenue each year for the Government.” [p. 3]
Action on Smoking and Health Australia, produced a reportthat examined the tobacco industry's tactics against plain packaging in Australia, and outlined how “The industry hides behind a libertarian cloak, complaining that Australia is an over-regulated ‘nanny state’ that will suffer job losses and further hardship if more regulation such as plain packaging is required by law.” 5 However, even when BAT announced the closure of its manufacturing facility in Australia in 2015, it specifically stated that plain packaging was not the reason for the closure. 6
1 Tabacalera anuncia cierre de operaciones en el país por cambios a ley antitabaco. La Tercera. September 7, 2015. Available from: http://www.latercera.com/noticia/tabacalera-anuncia-cierre-de-operaciones-en-el-pais-por-cambios-a-ley-antitabaco/(accessed March 7, 2017).
2 Euromonitor International. British American Tobacco Chile SA in Tobacco (Chile). August 2016.
3 Non-Smokers’ Rights Association/Smoking and Health Action Foundation. Available from:https://www.nsra-adnf.ca/cms/file/files/080701_Plain_Packaging_of_Tobacco_Products.pdf.
4 Quantification of the economic impact of plain packaging for tobacco products in the UK Report for Philip Morris Ltd. May 2013 Centre for Economics and Business Research Ltd.
5 A. Jones S. Sanders, and ASH (Australia) (2010). “Countering Tobacco Tactics: A guide to identifying, monitoring and preventing tobacco interference in public health.” Action on Smoking and Health (ASH) Australia, Kings Cross, N.S.W
6 BAT Australasia. “BAT Forced to Close Australian Factory.” Media release. October 31, 2014. Available from: http://www.bata.com.au/group/sites/bat_9rnflh.nsf/vwPagesWebLive/DOA3CJ8E/$FILE/medMD9QD9EF.pdf?openelement (accessed March 5, 2017).
7 U.S. National Cancer Institute and World Health Organization. The Economics of Tobacco and Tobacco Control. National Cancer Institute Tobacco Control Monograph 21. NIH Publication No. 16-CA-8029A. Bethesda, MD: U.S. Department of Health and Human Services, National Institutes of Health, National Cancer Institute; and Geneva, Switzerland: World Health Organization; 2016.
8 M. Goodchild ,N. Nargis , and E. Tursan d'Espaignet “Global Economic Cost of Smoking-Attributable Diseases.” Tobacco Control Published Online First: January 30, 2017. Available from: http://dx.doi.org/10.1136/tobaccocontrol-2016-053305.
9 The Economic Impact Assessment on standardised packaging in the UK.Available from: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/403493/Impact_assessment.pdf.
10 J. Lightwood and S. A. Glantz. “Smoking Behavior and Healthcare Expenditure in the United States, 1992–2009: Panel Data Estimates” (May 10, 2016). Available from: http://dx.doi.org/10.1371/journal.pmed.1002020.
11 “Japan Tobacco Set to Close Last UK Plant.”Financial Times. October 7, 2014. Available from: https://www.ft.com/content/ec286170-4e44-11e4-bfda-00144feab7de(accessed March 7, 2017).
12 U.S. National Cancer Institute and World Health Organization. The Economics of Tobacco and Tobacco Control. National Cancer Institute Tobacco Control Monograph 21. NIH Publication No. 16-CA-8029A. Bethesda, MD: U.S. Department of Health and Human Services, National Institutes of Health, National Cancer Institute; and Geneva, Switzerland: World Health Organization; 2016.
13 This was the conclusion of a report for the World Bank:“Curbing the Epidemic: Governments and the Economics of Tobacco Control.” Available from: http://tobaccocontrol.bmj.com/content/8/2/196.full. For instance,on page 69 it states,“A study in the United States found that the number of jobs would rise by 20,000 between 1993 and 2000 if all domestic consumption was eliminated.”
14A. B. Gilmore, B. Tavakoly, G. Taylor,. and H. Reed, “Understanding Tobacco Industry Pricing Strategy and Whether It Undermines Tobacco Tax Policy: the example of the UK cigarette market. Addiction, 108: 1317–1326. doi:10.1111/add.12159 (2013). Available from: http://onlinelibrary.wiley.com/doi/10.1111/add.12159/full.
15 N. Chenoweth. “Tobacco Firms in $2.2b payday.”The Australian Financial Review, July 2, 2014. Available from: http://www.afr.com/news/policy/foreign-affairs/tobacco-companies-22b-payday-20140701-j05h1.
16 i) M. Scollo, M. Bayly, and M. Wakefield. “Did the Recommended Retail Price of
Tobacco Products Fall in Australia Following the Implementation of Plain packaging?” Tobacco
Control, 2015; 24:ii90-ii93. Available from:
ii) Scollo, M. Bayly, and M. Wakefield . “The Advertised Price of Cigarette Packs in Retail Outlets across Australia before and after the Implementation of Plain Packaging: ARepeated Measures Observational Study.” Tobacco Control, 2015; 24:ii82-ii89. Available from: http://tobaccocontrol.bmj.com/content/24/Suppl_2/ii82.full.
iii) Scollo, M. Zacher, K. Coomber, M. Bayly, and M. Wakefield. “Changes in Use of Types of Tobacco Products by Pack Sizes and Price Segments, Prices Paid and Consumption Following the Introduction of Plain Packaging in Australia.” Tobacco Control, 2015; 24:ii66-ii75. Available from: http://tobaccocontrol.bmj.com/content/24/Suppl_2/ii66.full.
iv) Greenland, L. Johnson , and S. Seifi. “Tobacco Manufacturer Brand Strategy Following Plain Packaging in Australia: Implications for Social Responsibility and Policy.”Social Responsibility Journal, 2016; 12(2):321-34. Available from: http://www.emeraldinsight.com/doi/abs/10.1108/SRJ-09-2015-0127.
17Press release available here (accessed March 2, 2017): http://www.bata.com.au/group/sites/bat_9rnflh.nsf/vwPagesWebLive/DOA3CJ8E/$FILE/medMD9QD9EF.pdf?openelement.