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Important New Data Clearly Show Impact of Proposed IWG Guidelines on Fragile Economic Recovery

Today, the Sensible Food Policy Coalition, which represents advertisers, media and food and beverage marketers, has released important data showing how the guidelines for advertising proposed by the Interagency Working Group (IWG) on Food Marketed to Children would impact the U.S. economy.

The IWG, made up of the Federal Trade Commission (FTC), Food and Drug Administration (FDA), the U.S. Department of Agriculture (USDA) and the Centers for Disease Control and Prevention (CDC), has proposed “voluntary” guidelines that would severely restrict the marketing of many food and beverage products to children 2-17. 

This analysis assumes that if the guidelines were implemented, current food and beverage advertising expenditures would be cut by 20%.  This would result in a decrease in total annual sales by food and beverage producers by $30 billion and a loss of 74,000 jobs – in just one year alone.  Over a four year period (2011-2015), the cumulative lost sales would be $152 billion, and the cumulative decline in jobs would be 378,000. These figures include not only the decline in sales of food and beverage products resulting from the decrease in advertising, but also the impact on those companies that supply food and beverage manufacturers with services and raw materials.  It also takes into account the decline in sales by retailers that sell food and beverage products to consumers. 

Considering the very slow recovery from the global economic downturn and the high U.S. unemployment numbers, these figures dramatically show the potential damage the IWG guidelines threaten to cause. 

The analysis was performed by IHS Consulting, which has previously examined the economic impact of the advertising industry on the U.S. economy for the Alliance for American Advertising.  

If you have any questions, you can contact Dan Jaffe in ANA’s Washington office at 202-296-2359 or at djaffe@ana.net.

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