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2013 Economic Impact Study San Francisco International Airport SFO Connects the Bay Area to the World May, 2013 In Association with: ICF SH&E, Inc. and.

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Presentation on theme: "2013 Economic Impact Study San Francisco International Airport SFO Connects the Bay Area to the World May, 2013 In Association with: ICF SH&E, Inc. and."— Presentation transcript:

1 2013 Economic Impact Study San Francisco International Airport SFO Connects the Bay Area to the World May, 2013 In Association with: ICF SH&E, Inc. and Polaris Research and Development, Inc. Prepared by: Economic Development Research Group, Inc. 155 Federal Street, Suite 600, Boston, MA 02110

2 Executive Summary I

3 Findings 3 Direct Impacts – On Airport – 33,600 jobs, $5.5 billion in business activity – Off Airport – 82,800 jobs from $9.1 billion in visitor spending – Off Airport – 36,400 jobs from cargo valued at $17 billion, originating in the Bay Area and shipped from SFO Spin-off ripple effects of 135,500 jobs and $24.6 billion in business revenues $2.5 billion in state and local tax revenues

4 Total Economic Impact 4

5 How We Got There 5 Verified on-airport direct employment Conducted a 1,500 person visitor intercept survey in 4 languages Collected and analyzed freight data Applied the IMPLAN Modeling Package Identified aviation and major state and local tax impacts

6 Overview II

7 SFO Plays an Important Role in the Bay Area 7 A jobs center and economic engine An enabler of business and travel tourism – Enhancing the regional economy and hospitality industries A freight gateway – Supporting goods producing industries throughout the Bay Area A generator of tax revenues for California and the Bay Area

8 What are the impacts? 8 Jobs – Direct Jobs – generated by SFO and would not exist without SFO. – Indirect Jobs – generated when SFO or SFO-dependent firms buy goods and services from businesses located in the area. – Induced Jobs – generated by spending of wages that are earned by workers of SFO or SFO - dependent firms, and by employees of suppliers, for items such as food, clothing and housing. Business Revenue – Sales to airlines and service companies directly dependent on SFO. – Reported in terms of direct, indirect (local purchases) and induced (labor re-spending) categories. Personal Income – Wages and salaries received by individuals employed due to SFO activity. – Reported in terms of direct, indirect (local purchases) and induced (labor re-spending) categories.

9 Categories and Measures of Impacts Jobs, business revenues, personal income and taxes are shown by airport-generated, visitor industry, and air cargo related categories 9

10 Contribution to the Bay Area Economy 10

11 Jobs Center and Economic Engine III

12 Jobs at SFO include: Airlines – passenger and cargo activities Aviation Support Services – catering, in-flight entertainment, aircraft handling, fueling and maintenance Freight Transport – courier, delivery, customs broker and trucking Concessions – restaurants, retail stores and passenger services Ground Transportation Services – rental car, taxi, limousine service, and bus companies Air Terminal Operations Staff – security, building maintenance and facility management Public Agencies – FAA, other Federal Agencies and Airport Administration (including Police and Fire Departments) 33,580 People Work at SFO 12 Distribution of On-Airport Jobs Concessions 15% Construction 3% Passenger Airlines 47% Freight Transport 2% Aviation Support Services 7% Passenger Ground Trans. 17% Admin., Govt & Security 9%

13 Jobs and Business Revenues by County 13 Jobs Across the Bay Area (1) By place of residence (2) By location of job (3) Includes direct, indirect, and induced impacts Note: Jobs rounded to the nearest 100. $675 $394 $103 $35 $804 $6,663 $932 $90 $162 Airport Generated Business Impacts (3) ($ millions) Subtotal Direct:33,600 Subtotal Indirect & Induced:26,400 Total:60,000 Subtotal Direct:33,600 Subtotal Indirect & Induced:26,400 Total:60,000

14 Visitor Industry Impacts IV

15 The Airport Supports Tourism 15 Sources: SFO Traffic Statistics; U.S. DOT O&D Survey, YE 2Q 2012; U.S. DOT, T-100 Database; IATA, PaxIS Database; U.S. DOC, International Air Travel Statistics, 2011. 51.6% 55.4% Note: Totals may not add due to rounding.

16 SFO Binds the Bay Area to the Nation 16 Source: OAG, July 2013. 525 Daily Departures to 72 Domestic Markets (non-stop)

17 SFO is the Bay Areas International Gateway 17 Source: OAG, July 2013. 546 Weekly Departures to 33 International Markets (non-stop)

18 Visitors spend on hotels, restaurants, retail purchases, recreation, and local travel (taxis, car rental, and public transportation) International business travelers on average spend close to $2,000 per trip while domestic leisure travelers spend more than $800 per trip The Airport Supports Tourism 18 * direct, indirect and induced Individual Spending per Trip

19 Total Impacts of Visitor Spending By County* 19 *direct, indirect and induced Jobs in CountyBusiness Sales ($Millions) Solano $93 San Mateo $1,416 San Francisco $9,556 Napa $1,016 Marin $192 Contra Costa $239 Sonoma $725 Santa Clara $1,521 Alameda $1,524 Solano 834 San Mateo 10,994 San Francisco 70,710 Napa 8,670 Marin 1,582 Contra Costa 1,968 Sonoma 6,481 Santa Clara 11,283 Alameda 12,671

20 Impacts of Air Reliant Users (Freight shippers) V

21 Air Freight at SFO Supports the Bay Area Economy 21 Enables transport of goods from Bay Area to customers in both long-distance domestic and international markets. – Cargo services at SFO support Bay Area firms efforts to sell products across the U.S. and the world, and thereby maximize shares of national and international trade. Without the freight services offered at SFO (and if the similar scale of services are not assumed by another regional airport) – Companies in the Bay Area that produce and ship products would find markets limited and market shares curtailed. – In turn, economic activity in the Bay Area that is associated with production of goods shipped through SFO would be reduced.

22 Value of Air Freight 22 Represent sales of Bay Area companies in international and long distance US markets The sales bring income into the Bay Area from these markets to support jobs in the region. Multiplier effects (supplier sales and worker spending) generate additional jobs in the Bay Area. – Parts of the sales revenue are paid as wages & profits that are spent in the region; and – parts of the sales revenue is paid to supplier firms in the region for purchase of good and services that support additional jobs and wages Goods produced in the Bay Area and shipped from SFO

23 Exports from SFO Exceed Imports (by value) Value of Exports by Air – Value of Imports by Air = Surplus or Deficit Comparison of SFO and U.S. Air Exports by Value Source: US Census Bureau Foreign Trade Division, provided by WISERTrade. Dollars are in nominal value.

24 Shipments by Bay Area Firms through SFO 24 Top Domestic ShipmentsTop International Exports Trans. Equip 4% Computer & Electronics 67% Elec. Equip. & Appliances 2% Machinery 8% Chemicals 7% Economic Value Jobs – 103,144 Labor Income (payroll) – nearly $9.9 Billion Business Revenue – over $29 Billion $8.64B$7.99B All Other 12% Computer & Electronics 75% Machinery 19% Textile / Mill Prod. 2% All Other 2% Leather & Allied Prod. 2%

25 State & Local Tax Impacts VI

26 State & Local Tax Revenues Generated by SFO 26 $409M 65.0% $3M 33.3% $603M 65.1% $309M 32.8% $1.32B 52.8% $220M 35.0% $6M 66.7% $323M 34.9% $633M 67.2% $1.2B 47.2% $2.5B$942M$927M$9M$629M 2012 SFO State & Local Tax Revenues

27 State & Local Taxes Generated On-Airport and from Visitor Spending 27 * Direct tax revenues from on-airport employees are based on place of residence Subtotal Direct:$1.01B Subtotal Indirect & Induced:$544M Total:$1.56B Subtotal Direct:$1.01B Subtotal Indirect & Induced:$544M Total:$1.56B $ millions

28 Summary of Impacts VII

29 SFO- Economic Engine for the Bay Area* 29 288,000 jobs $55.8 billion in business revenues, of which $19.6 billion is personal income $68,000 average income per employee * direct, indirect and induced

30 Many Roles of SFO Create an Economic Engine for the Bay Area and its Counties 30

31 Appendix VIII

32 Elements of Economic Impacts and Interrelationships 32

33 Classification of Impacts 33 Direct (Initial Economic Activities) – Airport-based economic activities (airport terminal-related and tenants) – Off-airport businesses serving airport travelers – Off-airport businesses dependent on the airport for cargo movement Indirect – Suppliers of goods and services to the airport and air-dependent business Induced – Personal income spent by households in the Bay Area and re-circulated in the economy (earned by jobs in airport-based activities, visitor spending, air-dependent businesses, and suppliers of goods and services).

34 Direct Visitor Spending Ripples Through the Bay Area 34 * direct, indirect and induced $9 billion of visitor spending in the Bay Area generated: 125,000 jobs $6 billion in labor income $7 billion in additional indirect and induced output ($16 billion in total output)

35 Visitor Destinations Also Reach Beyond the Bay Area 35 Common Visitor Destinations Outside the Bay Area

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