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Trends in Defense Spending Boost San Diego

A new analysis of military spending in San Diego suggests defense dollars account for a growing share of the local economy.

Economist Kelly Cunningham of the National University System Institute for Policy Research has tracked military spending in San Diego for years. He says the latest figures reverse a trend that began after the Vietnam War.

In the late 1960s, military payrolls accounted for almost 30 percent of San Diego’s salaries. Then defense jobs shrank as the rest of the economy grew. But since 2001, Kelly says, total military wages and salaries in San Diego have risen faster than salaries in other sectors.


Kelly says San Diego has both a high military presence and lucrative defense contracts.

“We’re highest in military personnel,” he says, “and we’re fourth in total defense contracting.”

Those things combined make the County the biggest recipient of DoD money in the nation, receiving $13.7 billion in 2007.

Kelly says more than $2 billion of that pays for benefits and services for veterans. There are more than 100 thousand active duty Navy and Marines based in the county and more than 260,000 veterans living here.