Military Spending In San Diego
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April 23, 2010 – Analysis of the economic impact of the military in San Diego shows defense spending generates an estimated 340,000 jobs in the region. KPBS reporter Alison St John speaks with host Gloria Penner about the military's impact on the local economy.
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GLORIA PENNER (Host): A new analysis of the economic impact of the military in San Diego shows defense spending generates an estimated 340,000 jobs in the region. KPBS reporter Alison St John joins me now with more on the story. Welcome, Alison. ALISON ST JOHN (KPBS Reporter): Pleased to be here Gloria. PENNER: First of all, where does the analysis come from? ST JOHN: Well, it's funded by SDMAC, which is short for San Diego Military Advisory Council, which is a non-profit group of mainly business interests that advocates for the interests of the military in this region. PENNER: So the report compares the role of the military in San Diego to the entertainment industry in Los Angeles, to the financial industry in Wall Street and New York. So how much money is actually coming to San Diego through the Department of Defense? ST JOHN: It's big, Gloria, they estimate that this years it's about $17 billion, and that's, the only figures that there are, hard figures, for us is two years ago, 2008. But even then it was $16 billion, and since then we've seen an increase. And it looks like there's probably a spike last year, and it could be that we reached the peak, but it has been growing steadily since 2004, about 8 percent a year. PENNER: So how do we field that, what does it pay for? ST JOHN: So that pays for the salaries of about 130,000, 140,000people in the military. And it pays for the benefits, so of about 244,000 veterans that live in San Diego. It also covers all the defense contractors, you know, we have a lot of those in San Diego County. So it covers a broad gamut, a lot of manufacturing research, as well as the actual military training. PENNER: Is there any way of knowing how many jobs this actually creates? ST JOHN: Yes, it about 340,000 by estimate this year. In 2008, they estimate, by direct and indirect spending, it's 200, sorry 328,000. PENNER: Jobs. ST JOHN: Jobs. PENNER: Okay, so what percentage of total jobs would that be in San Diego? ST JOHN: Well that is an important question. It is a very large percentage of the jobs in San Diego. They estimate it's about 23 percent. That is a slightly lower estimate than the study that they put out two years ago. They took a look at their multipliers and some of their underlying assumptions, and decided that it wasn't as high as 27 percent of all the jobs, but 23 percent of jobs in San Diego is still a very significant part of our economy. PENNER: It really is, it's almost 1 out of 4. When you look back to previous years, how has the military presence here change fluctuated? ST JOHN: Well back in the '50s, like after World War II, we were in a position, I think, that where we were more vulnerable to cuts because so much of our economy, you know, maybe 40 percent of the jobs there. And at the beginning of the century, last century, most of the jobs here were military. So one of the questions is, is San Diego making itself a little vulnerable by having so much of its economy invested in DOD spending. And what the SDMAC President, Tony Nufer, explained was that he feels that the economy in San Diego is now more diverse, and so we are less vulnerable to the historic booms and busts of military spending. PENNER: Well now the USS Vinson is here, the big aircraft carrier. What's the latest on the number of military vessels that will be coming into San Diego, and therefore, I assume increasing military spending here? ST JOHN: Well we have a new Commander of Navy Region Southwest, Admiral William French, that came in a few months ago, and he says that the number of ships is going to go up from 56 to 83 by 2014. So that's almost, you know, that's another third again on top of what we have so there's a very large increase and 7,000 to 10,000 more sailors coming with them.