Download Presentation Title - Economic Development Research Group

Steven Landau
Economic Development Research Group, Inc.
www.edrgroup.com
For the Pennsylvania Aviation & Aerospace Conference
September 26. 2013
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
Ancient Trade Routes:
 Amber, Silk, Gold, Salt,
Frankincense

Inter-Modal passenger &
freight movement
 ACCESS to goods and new
markets
 BUSINESS TRIPS for sales &
procurement
 TOURISM to visit new places
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• ACCESS to broader markets & locations
 Affecting availability & quality of employment, residence,
materials (food, clothing), culture/recreation opportunities
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
The difference between measuring the
economic benefit of an airport and the role of
an airport in a local/regional economy
 Uniqueness of communities/regions, airport facility &
role, business mix, and projects
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Off Airport
Economic
Development
On Airport
Economic Impact
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$ Passenger Time Value (business)
$ Travel Expense (business)
$ Freight Shipper Productivity
$ Indirect (Downstream) Productivity
$ Location Income Attraction
• Economic Development Perspective:
Improving Access and Connections
 Facilitating access to new jobs, access to new business
markets, products & services
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
City, county and state legislators and
regulators who want to know ROI or are
unaware of the economic contributions made
by airports

Local economic development officials and
other transportation agencies

The general public who are voters

Neighbors who object to operations and
expansion plans
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Avoid (or at least define) Jargon No One
Understands & Use English
Jargon
Reasonable Translation/ clarification
Direct
Include type of impact (e.g., on-airport)
Indirect
Goods and Services sold by local suppliers
to support initial economic activity
Induced
Spending of wages earned by workers
Output
Business sales, or economic activity
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These effects can also be
reported together as
“multiplier impacts”,
“spinoffs” or “ripple effects”
Direct
Supplier
Sales*
Wages Spent
by Workers*
Total
On-Airport
Visitor Spending
Air Cargo Shippers*
Tax Revenues*
* Impacts in “Off Airport” economy
Important Information:
Jobs, Payroll, Output Business Sales, Local/State Tax Revenues,
Value Added
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Direct
On-Airport
Visitor Spending
Air Cargo Shippers*
Tax Revenues*
* Impacts in “Off Airport” economy
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Spinoff*
Total
Businesses & Government
Agencies on Airport
Direct Payroll
Off Airport Businesses
Purchases of
Goods & Services
Visitor Purchases of
Goods & Services
(Meals, Hotels,
Transportation, Retail)
Shippers & Receivers/
Market Access
(freight, productivity)
Direct Effect
Direct Effect
Jobs at the Airport
Income to Workers
Jobs in Retail & Services
Income to Workers
Indirect Effects (Off-Site)
Sales at Supplier Businesses:
Jobs and Income
to their Workers
Induced Effect (Off-Site)
Spending of Direct + Indirect Worker Income
on Consumer Purchases:
Sales at Other Businesses
Jobs & Income to Workers
Total Economic Impacts
Sum of Direct + Indirect + Induced Jobs & Income
Fiscal Impacts:
Government Tax Revenues
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Source: EDR Group
Airports Support:

Cost-competitiveness of existing business

Rate of business expansion/attraction

Breadth of activities for key local institutions

Existing business mix

Land use and development
trends and potential

Intermodal connections (both
passenger & freight)
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
Freight Patterns

Business Travel

Land Use
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
Increase of air freight, just-in-time delivery,
overnight courier

Expanding air-service reliant manufacturing
& services

Growing technology industries, yielding new
types of manufacturers & service providers

Use of corporate GA & fractional ownership

Intermodal air/truck/rail logistics
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
Higher value/weight*

Higher time sensitivity*

Overnight delivery*

Small package delivery trucks

Air & Marine port dependence on rail & hwy

Rail & truck companies focus on long-hauls
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
Civilian Aircraft, Engines, And Parts

Electronic Integrated Circuits

Pharmaceuticals & Chemicals

Electric Apparatus

Medical, Surgical, Dental or Veterinary Instruments

Automatic Data Process Machines

Precious Metals (gold, diamonds, etc…)

Machinery/Apparatus for Manufacturing
Semiconductors & Semiconductor Devices
Source: US Foreign Trade Division assembled by WISERTrade
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• Hotels
• Restaurants
• Entertainment
• Retail
• Local Transportation
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
Telecommunications

Architectural, engineering,
and related services

Management, scientific, and
technical consulting services

Banking, finance and business services

Government, other Public Administration

Universities and R&D centers

Medical Services
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• Manufacturing
• Advanced Logistics
• Creative Industries
• Life Sciences
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Las Colinas Near DFW

Air Industrial Parks

Warehousing

Hotel, Convention

Recreation

Office, Retail

Mixed Use Development
Airpark Business Ctr (BNA)
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
Airport Administration

Aviation Services

Services to Aircraft (e.g., repairs, janitorial, etc..)

Services to Passengers, Pilots & Crew: Terminal
Concessions

Airport Business Services

Government Services (e.g., FAA, Police, Fire, etc..)

Support for Agricultural- Flights not crops

Enables visitors - only off airport consideration
* Add it all up and present a number
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
Logistics facilities

Warehouses

Hi-tech sectors

Other Manufacturing

Finance

Business Services

Retail

Entertainment Industries
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AIRPORT ACTIVITY: number of based aircraft by type; estimated operations by
private aircraft, charter/air taxi services, commercial cargo services, commuter or
air carriers; volumes of freight and number of commercial passengers
AIRPORT FUNCTION: commuter, corporate, reliever, destination, hub, gateway,
maintenance functions
AIRPORT CAPABILITIES/CONSTRAINTS: critical aircraft type (prop, corporate
jet, air carrier craft); weight and range limits for critical aircraft; lighting and
navigation aids
NEARBY FACILITIES: Industrial parks, business parks, resorts and other
attractions
CHARACTERISTICS OF THE REGIONAL ECONOMY: population, workforce size
and education, employment by industry; local growth/change patterns in those
factors relative to broader state and national factors
CHARACTERISTICS OF THE REGIONAL SETTING: tourism attractions, business
location site opportunities; supporting infrastructure; distance/connections to
interstate highways, ports, urban centers, market area
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Airport Economic Development Factors
Regional Market Factors
•
•
•
•
Airport Characteristics
•
•
•
•
Industry Competition
Tourism Potential
Population
Business Attractiveness
•
•
•
•
Runway Capacity
Airport Services
Expansion Potential
Highway Connections
Desired Outcomes
Increased Tourism
Increased Business Travelers
Increased Air-Freight Capacity
Business & Job Attraction/Retention
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
Preserve/enhance functioning of rural communities
 Examples: provide lifelines for transportation, freight,
medical evacuation

Support local institutions
 Local, regional and statewide importance

Other ways that airports provide benefits
 Examples: military use, air shows, non-aviation land use
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Steven Landau
Economic Development Research Group, Inc.
155 Federal Street, 6th Floor
Boston, MA 02110 USA
Telephone: 1-617-338-6775 x 206
Email: [email protected]
Website: www.edrgroup.com
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Airport Economic Development
Regional Market Factors
Industry Composition
Tourism Potential
• Presence of industries that
use more aviation (travel,
cargo) than average
• Presence of industries that
use more aviation (travel,
cargo) than average
• Potential for job growth in
these industries
• Jobs created due to
increases in visitors and
expenditures
• Strength of tourist
attractions in service area
• Current visitor
expenditures
• Presence of a resort
Airport Physical Characteristics
Runway Capacity
• Accommodate corporate
jets, cargo or commercial
flights
(type of craft most
appropriate to meet local
economic development
needs).
Business Location Attractiveness
Airport Services
•
•
•
•
•
Refueling facilities
Maintenance facilities
Pilots Shop
Passenger terminal
Cargo terminal
Other
• Office and Industrial Parks
• Proximity to Markets
• Supporting Infrastructure (sewer, water, electricity,
broadband, etc.)
• Business Support Services
•
•
•
•
•
Distance from major highway(s)
Distance of population from airport
Delivery market size/access
Potential for Expansion
On-airport and/or airport owned acres available
for development
Desired Economic Impacts
• tourist expenditures
• Business traveler expenditures
• Business & job attraction/retention/expansion through cargo,
corporate and tourism activities
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