Maritime Administration www.marad.dot.gov 

Maritime Administration 

POLICY PAPER 

America’s Advocate for the Maritime Industry 

Cabotage laws date back to the earliest days of our history. In 1789, Congress imposed added duties on 

goods transported by foreign vessels. The Navigation Acts of 1817 barred foreign vessels from domestic 

commerce. In 1886, Congress extended cabotage laws to passenger vessels, and in 1905 Congress 

retained U.S. build requirements for domestic shipping. The Merchant Marine Act of 1920 was enacted 

with the aim of maintaining a merchant marine of the best equipped and most suitable types of vessels 

owned and crewed by U.S. citizens, sufficient to carry 

the greater portion of U.S. commerce and serve as a 

naval or military auxiliary at time of war. 

Section 27 of that Act is known as The Jones Act 

Together with the Passenger Vessel Services Act of 

1886, it reserves marine transportation of freight and 

passengers to U.S.-built, maintained, documented, 

owned and crewed vessels. Similar laws cover 

dredging in U.S. waters and towing and salvage operations. 

Benefits 

The business opportunities provided by these laws 

have encouraged enormous investments in vessels 

and other marine transportation assets. Over the last 

5 years, U.S. domestic carriers have significantly upgraded their fleets with 13 ocean-going vessels, 183 

tugs, 3,942 barges, 64 offshore supply vessels and 69 

ferries. The investments in new vessels have contributed to a 35 percent increase in the value of the industry’s assets, the highest five-year growth in 

25 years (Table 1). 

Table 1. Water Transportation Investment, Fixed 

Assets and Labor, 2001-2005 

% Ch

Type 2001 2002 2003 2004 2005 2001-

05

Investment ($Bil) 3.6 4.9 4.8 7.4 8.1 126

Fixed Assets 

($Bil.) 35.6 37.6 39.7 43.7 48.0 34.8

 

Labor (000 Jobs) 148.

5 147.8 148.3 147.9 154.5 4.0

Transportation 54.0 52.6 54.5 56.4 60.6 12.2

Port Services 94.5 95.2 93.8 91.5 93.9 -0.6

Sources: Bureau of Economic Analysis for fixed assets; Bureau of 

Labor Statistics

Maritime Administration Department of Transportation 
Maritime Administration Department of Transportation 

Maritime Administration www.marad.dot.gov

In 2005, the U.S.-flag domestic trade fleet of 38,544 

vessels transported about 933 million metric tons of 

cargo between U.S. ports. (Table 2)

The domestic trades include cargoes moved on the 

oceans (including trade between the 48 contiguous 

states and Alaska, Hawaii, Puerto Rico and Guam), 

along the coasts, on the inland waterways and the 

Great Lakes. 

In addition to serving as an essential link in our national transportation infrastructure, the domestic trade 

fleet is a critical component of America’s military 

readiness. Eighty-five percent of the oceangoing vessels in the fleet are militarily useful. 

Furthermore, of the more than 60,000 water transportation workers in the United States, 35,800 are mariners and nearly 8,000 these are qualified to crew 

deep-sea vessels and Ready Reserve Force and 

DOD sealift ships (Figure 1). 

The provisions of these laws must be maintained as 

an essential element of U.S. maritime policy that provides important economic and national security benefits to the nation such as support of U.S. shipbuilding 

and repair industries and maintenance of a labor force 

of skilled American mariners. 

Table 2. U.S. Domestic Waterborne Fleets and 

Trades, 2001-2005 

(Thousand Metric Tons)

% Ch.

2001 2002 2003 2004 2005 2001-

05

Fleets (vessels) 39,315 38,698 37,665 37,806 38,544 -1.9

Ocean 132 120 112 105 106 -19.7

Lakers 52 51 50 49 48 -7.7

Offshore Supply 392 403 421 443 454 15.8

Tugs/barges 38,160 37,529 36,475 36,580 37,317 -2.1

Ferries 579 595 607 629 619 6.9

Trades (000 

MT) 945.7 926.3 921.9 949.9 933.4 -1.3

Ocean/Coastal 202.8 196.3 202.8 200.1 193.8 -4.4

Inland 562.3 551.6 553.0 568.1 566.1 0.7

Lakes 90.7 92.1 81.5 93.9 87.3 -3.7

Other* 89.9 86.3 84.6 87.8 86.2 -4.1

*Intraport and intraterritory trades.

Source: Clarkson’s Research, Vessel Registers for ocean fleet; 

U.S. Army Corps of Engineers, Transportation Lines of the 

United States for fleets; and Waterborne Commerce of the 

United States for trades. Figure 1. Occupations in U.S. 

Water Transportation, 2006 

(Thousand Employees)

18.6

24.8

17.2

Licensed

Mariners

Unlicensed

Mariners

Other