Switzerland’s Strong Economic Footprint
Creating Half a Million Jobs and Supporting the U.S. Economy
Switzerland and the United States enjoy good and close relations dating back to the founding of the U.S. When the modern Swiss Confederation was established in 1848, it was strongly influenced by the Constitution of the United States. Over time, our shared history, values, and common belief in entrepreneurship, innovation, and a free market have made it possible for the relationship to evolve from two “Sister Republics,” as they were often called in the 19th century, to strong partners with a broad spectrum of cooperation and intense economic ties. To this day, about half a million Swiss citizens have immigrated to the United States. Some of them became famous and played a part in the history of both our countries: Albert Einstein, the famous Nobel laureate who developed the theory of special relativity when he worked at the Federal Office for Intellectual Property in Bern, and Emil Frey, who volunteered in the American Civil War and later became the first Swiss Minister (Envoy) to the United States and eventually President of the Swiss Confederation, to name a few.
One of the most underrated aspects of our two countries’ relations is the strong Swiss economic footprint in the United States. With $224 billion in cumulative direct investment, Switzerland is the 7th largest foreign investor in the United States, making it by far the most important destination for Swiss foreign direct investment. In other words, the U.S. absorbs about one-fifth of total Swiss investment abroad, which is more than in Germany, France, Italy, and the United Kingdom combined.
Swiss firms strengthen the American economy and have a substantial economic presence in the United States. They represent a diversified landscape, including large multinational Swiss firms with well-known names such as ABB, Credit Suisse, UBS, Nestlé, and Novartis, as well as many small and medium-sized enterprises (SMEs) which are active in niche markets, manufacturing highly specialized goods for various industry sectors. More than 500 Swiss companies with about 3,500 business locations all over the United States create almost half a million jobs. Swiss companies do business in all fifty states, with an exceptionally strong presence in terms of number of affiliates in California, New York, Illinois, Texas, and Florida. They are active in a huge variety of business sectors ranging from precision instruments and machinery to the food industry, financial services, resource management, and many more.
Even more impressive is the quality aspect. With an average annual salary of about $103,000, Swiss firms pay U.S. workers the highest annual salary among large investing countries. Moreover, no other country invests as much in research and development in the United States as Switzerland. To bolster their U.S. investments, in 2013, the latest year of available data from the U.S. government, Swiss firms spent more than $10 billion on research and development (R&D) activities in the United States. Not only did this support 24,000 R&D-related American jobs, it also demonstrates a commitment to high-tech work and innovation that defines the modern Swiss business ethos.
Switzerland is also a key trading partner of the United States. Bilateral trade in goods and services was more than $100 billion in 2015. Switzerland is the 7th largest market for U.S. exports of services, at nearly $30 billion, and the 17th largest export market for goods, exceeding $22 billion. The United States exports about twice as much to Switzerland as to the Scandinavian and Baltic countries combined. In return, the U.S. is Switzerland’s second most important trading partner worldwide.
The facts and figures about the bilateral business relationship between Switzerland and the United States show that the two countries not only share a common belief in entrepreneurship, innovation and a free market, but also have closely and successfully interlinked economies. With its small population of only 8 million, Switzerland punches well above its weight in the U.S. economy.
More information on the Swiss economic footprint in the United States can be found in the Embassy of Switzerland’s new publication. It also provides statistics and information for each of the 50 states and is available online at www.swissemb.org/fdi.