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Wright-Patterson had a $4.3 billion impact and employs more than 27,500 workers in an economic snapshot that takes a broader geographic view of how far the base’s financial and employment influence spans, an Air Force economic analysis shows.
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That’s a boost in both the number of people who worked on the base and the geographic area it impacts from a prior report because analysts estimated the impact of the base in 14 counties versus five previously, boosting both the economic effect and base population, Wright-Patterson officials say.
“Even using the old numbers, Wright-Patterson employs as many workers as the three next-biggest employers in the Dayton area combined,” Loren B. Thompson, a defense analyst and industry consultant with the Virginia-based Lexington Institute said in an email. “Whether you use the old or the new way of calculating economic impact, it’s clear Wright-Patt is the most important driver of economic prosperity in the region.”
Although the analysis showed an increase of about 1,400 base employees year to year, or about a 5 percent rise, the latest number in the fiscal 2014 economic analysis report showed more accurately those who already worked at Ohio’s largest single site employer rather than a frenzy of new hiring, a chief analyst said.
“They were here working on the base,” said Ernest Badman, 88th Air Base Wing chief of financial integration. “They just weren’t counted because they were outside the five counties” in prior assessments.
Bigger economic footprint
The previous survey spanning fiscal year 2013 projected a $4 billion impact and a population of 26,270 workers from the counties of Montgomery, Greene, Miami, Preble and Clark counties. Wright-Patterson released the most recent economic impact assessment, an economic yardstick measuring Oct. 1, 2013 to Sept. 30, 2014, on Tuesday.
The new survey added the counties of Auglaize, Butler, Champaign, Clinton, Darke, Fayette, Mercer, Shelby and Warren.
Wright-Patterson indirectly created another 34,560 jobs, with an economic value of nearly $1.4 billion, that pay an average of $40,423 a year, the analysis projected. The prior year estimates 32,384 indirect jobs at an average pay at $40,165 annually and with a total economic value of $1.3 billion.
Base analysts also expanded the scope of how far out they looked geographically because other organizations, such as the Dayton Development Coalition and Wright State University, asked for a 14-county look at economic impact, Badman said.
More was spent on construction, services, materials, equipment and supplies — $644.1 million in fiscal year 2014 compared to $614.2 million the previous year, or about a 4.9 percent rise, he said.
“The numbers speak for themselves — as the largest single site employer in Ohio, Wright-Patterson’s economic impact speaks volumes to the outstanding partnership we share with local businesses and institutions,” Col. John M. Devillier, base commander, said in a prepared statement.
Phillip L. Parker, Dayton Area Chamber of Commerce president and CEO, said the wider geographic snapshot was a more accurate look at Wright-Patterson’s economic footprint.
But in an apples-to-apples comparison, meaning comparing the five counties year-to-year, he suspected growth was likely flat. Base analysts did not do a five-county comparison between the two years, Badman said.
“When you’ve gone through sequestration and the turmoil of sequestration and how that has changed people’s strategic direction, buying, or maybe even employment, I think for us to have gotten through that and been relatively flat is pretty positive,” Parker said.
Sequestration, or automatic budget cuts mandated in the Budget Control Act of 2011, were projected to reduced defense spending over a decade. In 2013, it caused days-long furloughs of thousands of Wright-Patterson and federal civil service employees.
To counter the budget gap, Congress, in part, has added more money to the Defense Department overseas contingency fund to sustain warfighting in Afghanistan and strikes against the Islamic State.
Population and spending up
Wright-Patterson analysts estimated 20,055 civilian employees, both civil service and contractors, and 7,497 military service members, both active and reserve, work on the base. The number of military personnel dropped slightly by about 140 year-to-year.
With the bigger population projections, annual payroll reached $2.26 billion versus $2.12 billion, the analysis said.
“The takeaway that I got from this report is that Wright-Patterson employment is solid,” said Michael A. Gessel, vice president of federal programs at the Dayton Development Coalition. “It is stable and probably seeing slight growth on the civilian side.
“Given that this is a time of declining personnel and declining budgets, it is a very strong sign of support by the Air Force of Wright-Patterson and a sign of the health of Wright-Patterson,” he said.
The report also showed a rise in both payments and the number of military retirees with more counties added. Payments reached a total of $425.1 million to 14,786 retirees in 2014, compared to $346.7 million paid to 11,876 retirees the prior year.
As part of the $644 million in procurement, Wright-Patterson spent less for services, dropping to $207.5 million from $267 million the prior year, but saw a hike in what it spent on materials, supplies and equipment: $320 million, up from $247.5 million previously, the report said.
Construction spending rose slightly to $116.1 million compared to $99.6 million the year prior.
Military spending "follows a different rhythm than the commercial business cycle, so Wright-Patt also helps mitigate the impact of recessions," Thompson wrote. "Any way you look at it, the base is an economic gem."
Locally, small businesses have had a rise in Wright-Patterson-related contract spending in recent years, Air Force figures show. The Air Force Materiel Command, Air Force Research Laboratory and the National Air and Space Intelligence Center, all headquartered the base, spent millions more to hire small companies.
In the most recent fiscal year, for example, AFRL reported spending $216.5 million on small businesses in Montgomery and Greene counties — the two counties Wright-Patterson spans — compared to $202.3 million in 2014 and $165.8 million the prior year.
A push to commercialize technology coming out of federal labs, such as AFRL, has brought more collaboration with universities and defense contractors in the region, said Deborah Gross, executive director of the Dayton Area Defense Contractors Association. “It helps the Air Force a ton in that they are getting new and innovative ideas,” she said.