AIA: Report Highlights Positive Economic Impact of Aerospace and Defense Industry

Arlington, Va. — The American aerospace and defense industry is a vital component of the U.S. economy, not solely for the role the industry plays in national security, transportation and technological innovation, but also because its influence spans many sectors and every state countrywide.  This is the conclusion of a new study commissioned by AIA from business information firm IHS Inc. about the industry’s economic impact.

“This new study demonstrates definitively that America’s aerospace and defense industry is an engine of economic progress, in addition to its having a vital role in helping keep our citizens safe and secure,” said AIA President and CEO David F. Melcher. “When you hear people talk about the importance of ensuring we keep good manufacturing jobs in the U.S., you can start with the solid foundation of our industry.”

In the study, IHS estimates that in 2015 the U.S. aerospace and defense industry fueled the following contributions to the U.S. economy:

  • Supported 1.7 million jobs within businesses producing end-user goods and services and within the industry’s supply chain, with about 531,000 jobs in the industry’s commercial aerospace segment (e.g. civil and general aviation aircraft, helicopters and space systems) and 511,000 jobs in the defense and national security segment of the industry (e.g. military aircraft, ground and sea systems, armaments and space systems).
  • Represented approximately two percent of the nation’s employment base and 13 percent of the nation’s manufacturing employment base.
  • Generated $300 billion in economic value, representing 1.8 percent of total nominal Gross Domestic Product in the U.S., and 10 percent of manufacturing output.
  • Produced labor income approximately 44 percent above the national average – $93,000 average labor income per job – reflecting the highly skilled nature of the workforce.
  • Provided tax receipts to federal, state and local governments from companies and their employees of $63 billion, or about 1.7 percent of total tax revenues.

Melcher noted that contributing to economic performance of the American aerospace and defense industry of late has been “strong growth in international markets, including a record balance of trade in 2015 of $69.6 billion, which has helped accelerate our country’s recent economic recovery.” Melcher pointed out that the good news abroad “helped our industry deal with the negative headwinds caused by cuts to federal defense, civil aviation and space budgets mandated by the Budget Control Act of 2011 and global market forces that have negatively impacted the U.S. manufacturing base.”

The complete study, “Aerospace and Defense Economic Impact Analysis,” can be found on AIA’s website: www.aia-aerospace.org.