5th Annual SDMAC Military Economic Impact Study | San Diego Region | 2013
SECTION I: THE ECONOMIC IMPACT The Military’s Footprint in San Diego The military and defense spending have long played a dominant role in San Diego. Even as the region has diversified into other areas, including life sciences, telecommunications, alternative energy, and health care, the attention to national security represents a key economic driver. Funds devoted to carrying out the nation’s defense priorities flow into San Diego through three primary channels. First, compensation supports the Navy, Marine Corps, civilian employees, and reserves stationed in the region. Next, outlays on materials, equipment, construction, and research bolster both the local bases and U.S. defense operations worldwide along with the impact of military-linked tourist dollars. Finally, benefit payments flow to individuals who have served the military in some capacity over the course of their lifetimes. For fiscal 2013, $24.6 billion is estimated to have come to San Diego to support these three principal channels. This amount equals more than $7,800 for every San Diego resident. Approximately 45% will represent the payroll for active duty, civilian employees, and reserve members as well as the value of any housing allowances. Another 42% will be the result of various procurement contracts, ongoing smaller amounts of spending obligations of the local military bases, and the expenditures by friends and family members visiting from outside the region. A final 13% will be dedicated for the payment of retirement and other benefits accruing to veterans, retired military, and retired civilian Department of Defense (DoD) employees. (See Exhibit 1.) Exhibit 1
Defense Funds Flow to San Diego Through Different Defense Funds Flow toChannels San Diego through
Exhibit 1
Different Channels Billions of dollars, FY 2013e Billions of dollars, FY 2013e Total = $24.6 billion Total = $24.6 billion Retirement & Benefits 13%
Compensation 45%
Procurement & Spending 42% e=estimate
Source: FBEI
19