Environmental implications of service industries

The service sector in the U.S. economy accounts for twice the monetary outp ut of manufacturing and is typically perceived as less damaging to the envi ronment than manufacturing sectors. We use an Economic Input-Output Life-Cy cle Assessment model (EIO-LCA) to assess both the direct and indirect (supp ly chain) effects of services on the economy and the environment. As expect ed, environmental emissions and wastes generated directly by service provid ers are small per dollar of output, and energy use per dollar output is low er for services than for most manufacturing industries. However, with such a large share of the Gross Domestic Product (GDP), the impacts of services have become a significant component of overall U.S. emissions, wastes, and energy consumption. For several environmental metrics (e.g., hazardous wast e generation), service industries have significant indirect environmental e ffects on an economy-wide basis even when their direct emissions are neglig ible. When an average annual "market basket" of goods and services is purch ased by an average consumer in the U.S., the amount spent on manufactured g oods is about 25% greater than that spent on services, hut the environmenta l effects associated with manufacturing are about two to three times that o f services. To investigate services in more detail, four representative ser vice industries were analyzed: trucking and courier services, retail trade, colleges and universities, and hotels. Some results are expected, such as the high direct consumption of electricity, the low direct emission of toxi c chemicals, and the low direct generation of hazardous wastes. We demonstr ate that the supply chain environmental effects associated with these four services are more significant and merit further consideration. A better und erstanding of these impacts will encourage service providers to consider mo re carefully the environmental implications of their supply chain.