parts of the economy (induced impacts). This technical memorandum presents an analysis of the aerospace industry, including its statewide impacts and
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Community Attributes Inc. tells data – rich stories about communities that are important to decision makers. President & CEO Chris Mefford Project Manager Spencer Cohen, PhD Analysts Doudou Feng Madalina Calen Carrie Schaden Community Attributes Inc. 1411 Fourth Ave, Suite 1401 Seattle, Washington 98101 www.communityattributes.com
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C ONTENT S Introduction .. .. .. .. 1 Summary of Findings .. .. .. 1 Methods an d Data .. .. .. .. 2 Direct Activities in Washington State .. .. . 3 Employment, Occupations, and Establishments .. .. 3 Wages .. .. .. 6 Business Revenues .. .. .. . 8 Economic and Fiscal Impacts .. .. 10 Aerospace Across the State .. .. 12 Aerospace Impacts by County .. .. 16 King County .. .. .. 16 Economic Impacts .. .. .. 17 Snohomish County .. .. .. .. 18 Economic Impacts .. .. .. 19 Pierce County .. .. .. . 20 Economic Impac ts .. .. .. 21 Spokane County .. .. .. 21 Economic Impacts .. .. .. 22 Yakima County .. .. .. . 23 Economic Impacts .. .. .. 24 Grant County .. .. .. . 24 Kitsap County .. .. .. 25 Other Washington Counties .. .. .. 26 Co nclusion .. .. .. 27 Appendix A: NAICS Codes Used in This Report .. . 27
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AFA PAGE 1 2018 AEROSPACE ANALY SIS AUGUST 2018 I NTRODUCTION The aerospace sector is a major driver of economic activity in Washington state. Anchored by The Boeing Company and supported by an extensive supply chain, the aerospace sector is a key source of innovation, economic growth, and wealth. In 2013, 2015, and 2016, Community Attributes Inc. (CAI) produced a data – the state economy, including both direct activities and the secondary impacts of the industry through upstream business – to – business transactions (in direct impacts ) and worker income expenditures on goods and services in other parts of the economy (induced impacts). This technical memorandum presents a n analysis of the aerospace industry, including its statewide impacts and county – level industry presen ce . S UMMARY OF F INDINGS The aerospace industry, anchored by The Boeing Company, continues to be a significant source of employment and wealth creation across the state. Key findings from this study are as follows: Aerospace revenues in Washington in 201 7 r emained much higher relevant to prior years since 2000 . In 201 7 , a erospace companies in Washington reported $ 66.8 billion in gross revenues, down slightly from 201 5 . This compares against a ten – year average from 2000 to 2010 of $4 4.0 billion (inflation adjusted , 201 7 dollars). The Boeing C ompany generated an estimated $ 54.8 billion in revenues from operations in Washington state in 2017 , down from a historic high of $6 2.0 billion (estimated, 201 7 $) in 201 4 . Revenues from related industries defined as other industries engaged in or with close linkages to the aerospace supply chai n increased from $ 7.0 billion in 20 09 to $11. 6 billion in 201 7 (inflation – adjusted, 2017 $) . In 2017, Washington state 84,000, an 11% increase in aerospace workers over the past fifteen years. Since 2002, when the number of aerospace workers were at 75,700, there have been numerous ups and downs in the aerospace industry globally, which were reflected over the years in the ups and workforce in Washington is estimated to be 68,900. Other aerospace firms in Washington saw employment increase by more th an 31% from 2012 t o 2017 . Total aerospace industry wages (before benefits) in 2017 totaled $9.2 billion, slightly down from the peak of $10.6 billion in 2014 (in inflation – adjusted terms). In 2017, the average annual wage paid per
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AFA PAGE 2 2018 AEROSPACE ANALY SIS AUGUST 2018 worker was $109,400, nearly the same as th e annual wage since 2014 ( adjusted for inflation ). The total economic impact of the aerospace industry in Washington state in 2017 included 2 2 6 , 13 0 jobs, $ 1 9 . 7 billion in labor income, and $ 89 . 6 billion in business revenues. However, employment impacts in 2017 were lower than in 2015 (from a prior aerospace impact analysis), when the industry supported through direct and multiplier effects 252,800 jobs statewide. Factoring in multiplier effects, the aerospace industry was associated with $ 4 20 . 1 million Washington state fiscal tax revenues in 2017 . M ETHODS AND D ATA This report uses data published by state and federal agencies, as well as company – wide employment and revenue data made available by T he Boeing Company. Employment, wage, and establishment count data for aerospace and related industries w ere procured from the Washington State Employment Security Department, while the Washington State Department of Revenue was the source for gross busines s income for aerospace and related industries. Implicit price deflators were sources from the St. Louis Federal Reserve Bank. The Washington State Input – Output Model wa s used to evaluat e the statewide and county – level economic impacts of the aerospace ind ustry , including indirect and induced impacts . The model was customized for county – level impacts to reflect local level supply chain and household spending dynamics.
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AFA PAGE 4 2018 AEROSPACE ANALY SIS AUGUST 2018 Exhibit 2. Boeing Employment in Washington State, 200 3 – 2017 Source : The Boeing Company , 201 7 ; Community Attributes Inc., 2018 . Aerospace is a major employer of high – skilled occupations, ranging from engineers and assembly line workers to administrative staff. In 2017, estimated leading occupations included aircraft and structural assembly jobs, aerospace engineers, and industrial engineers . Many of these positions paid compensation well in excess of $ 100,000 per year, before benefits ( Exhibit 3 ).
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AFA PAGE 5 2018 AEROSPACE ANALY SIS AUGUST 2018 Exhibit 3. Aerospace Occupations in Washington State, 2017 Source: U.S. Bureau of Labor Statistics , 2018; Community Attributes Inc., 2018. Related industries include additional businesses and operations with strong (NAICS) codes developed by the Washington State Employment Security Department (ESD) and Wash ington Aerospace Partnership in 2013, and has been used in the 2013, 2015, and 2016 aerospace reports to approximate the broader aerospace supply chain eco – system (see Appendix A for list of industry codes). In 2017, this group of industrie s employed 44,6 3 0 workers in Washington state, a 29% increase over a recent low in 2010 of 34,500 workers ( Exhibit 4 ) .
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AFA PAGE 6 2018 AEROSPACE ANALY SIS AUGUST 2018 Exhibit 4 . Related Industry Employment, 200 2 – 2017 Source: Washington State Employment Security Department , 2018; Community Attributes Inc., 2018 . Wages In 2017, the aerospace industry generated a total of $9.2 billion in annual wages ( Exhibit 5 ), not including benefits such as employer – provided health insurance. Adjusted for inflation, total annual wages, in aggregate across all aerospace workers, declined slightly from a peak of $10.6 billion in 2014. At the state level, aerospace workers avera ged an annual wage of $109,400 ( Exhibit 6 ) in 2017. The average wage also declined from $113,000 in 2014, which may in part reflect an increase in retirements since 2014 due to an aging workforce. Exhibit 5 . Aerospace Total Wages in Washington State, 200 1 – 2017 (2017$) Source: U.S. Bureau of Labor Statistics , 2018; Community Attributes Inc., 2018.
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AFA PAGE 7 2018 AEROSPACE ANALY SIS AUGUST 2018 Exhibit 6 . Aerospace Average Annual Wages in Washington State, 2001 – 2017 (2017 $) Source: U.S. Bureau of Labor Statistics , 2018; Community Attributes Inc., 20 18. Related industries experienced a steady increase in annual total wage s . In 2017, total wages ( less benefits) reached $3.4 billion ( Exhibit 7 ) . This represents a 5.0 % average annual increase since 2009 , in real inflation – adjusted 2017 dollars . The average wage in related industries was $76,000 in 2017 ( Exhibit 8 ) . Exhibit 7 . Related Industry Total Wages in Washington State, 2002 – 2017 (2017 $) Source: U.S. Bureau of Labor Statistics , 2018; Community Attributes Inc., 2018 .
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