The Economic Impact of Alabama’s Six Major Commercial Service Airports on the State’s Economy report was prepared for The Aviation Council of Alabama by Dr. M. Keivan Deravi, Economic Research Services, Inc.
July 16, 2020
The economic impact of U.S. airports in 2017 amounted to $1.4 trillion in value of goods and services produced (output), $428 billion in earnings, and 11.5 million jobs according to the Airports Council International (ACI) of North America. They state that, “airports are not just the gateways for their communities but are vital contributors to the health of the American economy.”
With the release of Dr. Deravi’s report on the economic impact of Alabama’s six major commercial service airports, The Aviation Council of Alabama demonstrates that not only nationally, but inside Alabama, airports are more than runways and terminal. Airports are powerful engines of economic growth and they are one of the most fundamental components of business infrastructures, because they facilitate continuous economic growth for contiguous economic regions. Airports also provide both economic benefits and economic impacts for their respective regions.
Economic impacts are typically measured in terms of the additional employment and earnings for the community that are directly attributable to the airport’s business and aviation operations. The economic benefits, on the other hand, are measured in terms of transportation efficiency, or more specifically, the dollar value of time and resources saved. The transportation benefits of airports can include safety, convenience, access, and time savings.
Currently there are 76 airports in Alabama. Six (6) of the airport are commercial, and seventy (70) are general aviation facilities. The purpose of the Economic Impact of Alabama’s Six Major Commercial Service Airports report is to provide an estimate of the economic impact for Alabama’s six commercial service aviation facilities. More specifically, this report looks at the economic impacts of Birmingham-Shuttleworth International, Huntsville International- Carl T Jones Field, Mobile Regional, Montgomery Regional (Dannelly Field), Dothan Regional, and Northwest Alabama Regional airports.
“Airports across the state of Alabama have been critically impacted by the COVID-19 pandemic”, said Todd Storey, Aviation Council of Alabama President. “The passage of the Coronavirus Aid Relief and Economic Security Act (CARES Act) was an important step toward delivering broad-based relief across the aviation industry, however, the relief is only temporary. This report shows that it is imperative that air travel regains momentum and that organizations return to the sky as a part of conducting business. This is because if they do not it will be detrimental to not only aviation and the airports, but also to the local community and national economic recovery as a whole. The importance of air travel to the overall national economic recovery was also recently stressed by Treasury Secretary Steven Mnuchin during a segment discussing economic models during the pandemic.”
Dr. Deravi’s report estimates that the total spending (output) impact of the Alabama Airports on the State’s economy amounted to approximately $5.0 billion in 2019. It is also estimated that approximately $1.7 billion of this total economic impact is solely due to the aviation and aviation related activities. Furthermore, the total employment and payroll impact attributable to Alabama Airports is approximately 69,200 direct and indirect jobs and over $2.6 billion of additional payroll to the economy of the State. The report found that direct total employment of the airports (aviation and aviation related entities) is estimated to amount to 16,200 jobs (on a full-time equivalent basis in 2019) and that the payroll of the entire on-site business operation is estimated to be $705.5 million.
These six Alabama commercial service airports and their auxiliary businesses collectively add a total of $948.1 million to the State’s economy in the form of non-payroll business transactions. In summary, the Airports are directly (not counting tourist spending and the induced and indirect impacts at any level) responsible for a total employment of 16,200 individuals and a total direct addition of $1.6 billion to the State’s economy.
“The Aviation Council of Alabama serves as a unified voice for Alabama’s airports”, said Rick Tucker, ACA Legislative Committee Chair/Huntsville International Airport CEO. “This report illustrates the impact of Alabama’s Six Major Commercial Service Airports on the State’s Economy. For every $1 investment in these airport core businesses it can generate $5 of additional income for the local community and state of Alabama. It validates the need for continued development, expansion and improvement to Alabama airports in order for them to meet the needs of tomorrow’s business environment so that they will continue to substantially impact Alabama’s economy.”
Aviation Council of Alabama is Alabama’s only statewide airport and aviation association which represents International, Air Carrier, General Aviation Airports, and Aviation Businesses, Economic Developers, Pilots, Aircraft Owners and Aviation Associations. The Aviation Council of Alabama is dedicated to continued improvement, development and advancements of airports and aviation throughout the state. For more information visit TheAviationCouncilOfAlabama.com