Ports and Employment in Port Cities

This paper proposes a technique for estimating the employment impact of a port on its local economy. The topic is important due to the existence of possible imbalances between local and global benefits. Whilst ports represent key nodes in the international logistic chain, several factors have led to decline in port-induced benefits at the local level (re-location of former port-related industries, shifts from local to international inputs, an increase in negative environmental externalities). The proposed methodology overcomes the traditional discretionary distinction between port-related and non port-related industries. As the crucial question is not ‘if’ but ‘to what extent’ an industry is related to a port, this approach focuses on estimating the probability of the relationship. A preliminary phase, using location quotients and control region techniques, compares the employment structure of port economies to that of a standard ‘non-port’ economy; once the probability of an industry being port-related has been estimated, employment data are added in a second phase providing thereby individual ports with an actual assessment of employment impact. The technique is tested by means of a preliminary survey on Italian ports and a specific employment assessment carried out for the port of Genoa.