Economic impact studies measure direct and indirect effects on an area economy. Direct impact refers to an agency's spending on goods and services, its various sources of income, and employment levels. Indirect impact is the effect of the agency's spending and employment on other sectors of the economy through the multiplied impact of spending and job creation. The indirect impact is an attempt to measure the impact on various businesses and industries that depend on the re-spending of income and other expenditures generated by an organization. NASA Langley is a very large economic generator. Its direct impact can therefore best be analyzed by evaluating its employment, payroll budget, contract and grant spending, taxes and revenue. The total economic impact is the combined effect of both direct and indirect effects in terms of total output, earnings, and employment. (Note: This economic impact study was prepared for NASA Langley by Dr. Marshall Booker, Christopher Newport University, Newport News, VA.)
Economic impact analysis considers the interrelatedness of industry within a local region and evaluates these relationships to determine the response of the regional economy to various changes in the economic base of the community. Input-Output tables are useful in this evaluation because they are a graphic presentation of the regional accounts of an economy system and illustrate the flows among various sectors of that economic system. Input-Output analysis divides the economy into two sectors: those that produce output (either final or intermediate) and those that use that final or intermediate output in the production of other goods or services. An Input-Output analysis is a simple yet highly effective picture of resource flows within an economic system. Input-Output analysis makes it possible to examine the impact of income generation or job generation as they multiply through the economy, creating additional income, expenditures and jobs. The economic multiplier for any sector of an economy measures the impact that an initial expenditure or income will have as the expenditure generates additional jobs and income and therefore generates additional expenditures and jobs, etc. In other words, a dollar spent is not simply a dollar spent. An income earned is not simply an income earned. They both get multiplied throughout the interrelatedness of the economy. For example, an employee making $50,000 plus benefits of approximately 28% spends a major portion of that income in the local economy. This generates jobs in that expenditure chain in industries such as food, housing, financial services, insurance, transportation, personal services, etc. These jobs then generate additional income and another round of spending as those recipients spend money on similar consumer goods and services.
This study utilizes regional Input-Output multipliers generated from the Regional Industrial Multiplier System (RIMS II) model as generated by the Bureau of Economic Analysis of the U.S. Department of Commerce and the IMPLAN Model used by the Virginia Employment Commission and adjusted for special local considerations by the Bureau of Business and Economic Research at Christopher Newport University. These methods, which concentrate on final demand multiplier to estimate an agency's impact, are widely used in both public and private sector analysis regarding economic impact analysis.
The output impact of NASA Langley spending for FY 1997 can be seen in the following table, which uses final demand multiplier to measure the output effects of spending by sector at NASA Langley. Total spending is calculated by sector and the appropriate multiplier is then applied to that sector to measure both direct and indirect economic impacts.
Spending Impact FY 1997
Sector Direct spending Multiplier Indirect impact Engineering, business, & $295,440,000 2.4103 $712,099,000 professional services Payroll/household earnings 180,470,000 1.6093 290,430,000 Data processing/equipment services 55,728,000 2.5012 139,387,000 Miscellaneous services 43,834,000 2.5678 112,557,000 Colleges, universities, schools 40,079,000 2.6178 104,919,000 New & repair construction 38,960,000 2.3542 91,720,000 Utilities services 18,153,000 1.8976 34,447,000 Fabricated products (metals) 16,717,000 2.3895 39,945,000 Instruments and related products 9,684,000 2.1245 20,574,000 Electronic and electric equipment 6,426,000 2.4168 15,530,000 Transportation/travel 4,523,000 2.4832 11,232,000 Communications 2,255,000 1.9888 4,485,000 Machinery, non-electrical 1,510,000 2.5439 3,841,000 Health-related services 487,000 2.6156 1,274,000 Total indirect and direct $714,266,000 $1,582,440,000 Total impact $2,296,706,000
As the table indicates, NASA Langley's total outlay of $714,266,000 increases economic output in the region by a total of $1,364,191,000 for a combined impact of more than $2 billion.
Total permanent employment at NASA Langley was 3972 as of September 30, 1997, making it one of the major employers in the local area and in the Commonwealth of Virginia. Of these employees, 2,515 were civil servants (63.3%) and 1,457 (36.7%) were contractor employees working for a total of 31 contractors either on-site or nearby. Total permanent employment at NASA Langley has declined 19.7% over the past 3 years, mainly due to successes in working more efficiently with less resources.
Employment projections at NASA Langley are for civil servant employment to remain fairly stable, while contractor employment is projected to continue to decline over the next 2 years. The projected level of employment for NASA Langley in the year 2000 is 3672 for permanent employment.
NASA Langley Employment
Fiscal year Total Civil service Contractor
employment employment employment
Actual:
1995 4726 2751 1975
1996 4395 2562 1833
1997 3972 2515 1457
Projections:
1998 4070 2488 1582
1999 3953 2389 1564
2000 3672 2374 1298
NASA Langley employees are highly educated with high degrees of technical knowledge and skill levels. They include a large percentage of both research and applied scientists and engineers. Total salaries and benefits for all civil servant employees for FY 1997 at NASA Langley was $180,500,000. In addition, this financial impact to the local economy is supplemented by the large number of NASA Langley employees who have retired and are still living in the area.
Total Budget = 684.0M
Budget Summary Program Year 1996-1997 ($M)
|
|
PY 96 |
PY 97 |
|
Salaries/Benefits |
174.6 |
180.5 |
|
Travel |
4.2 |
4.2 |
|
Research & Program Management |
178.8 |
184.7 |
|
Research Operations Support |
21.1 |
23.3 |
|
Construction of Facilities |
9.0 |
6.6 |
|
Gross R&D |
420.1 |
469.4 |
|
Total Budget |
629.0 |
684.0 |
Total Gross R&D Budget = $469.4M
Gross R&D Funding Program Year 1996-1997 ($M)
|
|
PY 96 |
PY 97 |
|
Aeronautics & Space Transportation Technology |
330.7 |
362.2 |
|
Mission to Planet Earth |
59.1 |
81.4 |
|
Life & Microgravity Science & Applications |
4.4 |
2.0 |
|
Safety & Mission Assurance |
3.0 |
1.2 |
|
Chief Engineer |
0.8 |
1.4 |
|
Space Flight |
0.5 |
0.5 |
|
Space Science |
1.1 |
1.8 |
|
Academic Programs |
14.7 |
12.2 |
|
|
6.3 |
7.2 |
|
Total Gross R&D |
420.1 |
469.4 |
NASA Langley Gross R&D Funding for Office of Aeronautics & Space Transportation Technology for Program Year 1997 = $362.2M
Gross R&D Funding Office of Aeronautics
Program Year 1997 ($M)
PY 97
Airframe Systems.................................................. 89.2
Interdisciplinary Technology ..................................... 6.5
Information Systems .............................................. 5.1
Propulsion Systems ............................................... 0.4
Flight Research..................................................... 3.5
Airspace Operations ............................................... 3.9
Rotorcraft ........................................................... 3.7
Aeronautics Base............................................................ 112.3
High Speed Research....................................................... 119.7
Advanced Subsonic Technology.......................................... 86.5
High Performance Computing ............................................ 5.7
Space Transportation ....................................................... 13.6
Other Programs ............................................................. 24.4
Total Gross R&D 362.2
FY 1992- FY 1997 MAJOR PROGRAM AFPCE's*
FY 1992 - 15,100,000
FY 1993 - 2,200,000
FY 1994 - 57,000,000
FY 1995 - 0 (No projects)
FY 1996 - 0 (No projects)
FY 1997 - 0 (No projects)
TOTAL $74,300,000
FY 1992 - FY 1997 MINOR PROGRAM AFPCE's
Rehab and Mod Repair
FY 1992 - 4,220,000 FY 1992 - 4,715,000
FY 1993 - 3,625,000 FY 1993 - 4,435,000
FY 1994 - 4,075,000 FY 1994 - 3,545,000
FY 1995 - 2,410,000 FY 1995 - 3,640,000
FY 1996 - 4,245,000 FY 1996 - 3,229,000
FY 1997 - 4,542,000 FY 1997 - 1,908,000
Total $23,117,000 Total $21,472,000
Minor Construction Environmental Restoration
FY 1992 - 1,630,000 FY 1992 - 4,500,000
FY 1993 - 1,140,000 FY 1993 - 4,680,000
FY 1994 - 1,252,000 FY 1994 - 550,000
FY 1995 - 665,000 FY 1995 - 1,100,000
FY 1996 - 665,000 FY 1996 - 1,590,000
FY 1997 - 0 FY 1997 - 666,000
Total $5,352,000 Total $13,086,000
Total Major Programs FY 1992 - 1997 = $74,300,000
Total Minor Programs FY 1992 - 1997 = $63,027,000
Total Programs FY 1992 - 1997 = $137,327,000
* Approved Facility Project Cost Estimate (AFPCE)
Net Value of Obligations
|
Business Firms |
$445,316,514 |
|
Educational Institutions |
47,085,742 |
|
Nonprofit Organizations |
19,808,014 |
|
Intragovernmental |
30,482,315 |
|
Outside United States |
1,993,155 |
|
Total |
$544,685,740 |
|
CATEGORY |
FY 1997 |
|
Large business |
$115,327,374 |
|
Small business |
86,588,391 |
|
Educational institutions |
15,934,060 |
|
Non-profit |
14,969,652 |
|
Total |
$232,819,477 |
Senator Charles S. Robb
Senator John W. Warner
|
Congressional |
Congressional |
NASA FY 1997 |
Obligations (K) |
|
District |
Representative |
Agency |
Langley |
|
1 |
Herbert H. Bateman |
$224,177 |
$185,628 |
|
2 |
Owen B. Pickett |
4,717 |
3,157 |
|
3 |
Robert C. Scott |
6,345 |
5,884 |
|
4 |
Norman Sisisky |
99 |
- |
|
5 |
Virgil H. Goode, Jr. |
4,901 |
892 |
|
6 |
Robert W. Goodlette |
373 |
194 |
|
7 |
Thomas J. Bliley |
684 |
210 |
|
8 |
James P. Moran |
63,700 |
5,790 |
|
9 |
Rick Boucher |
7,297 |
6,314 |
|
10 |
Frank R. Wolf |
63,736 |
22,043 |
|
11 |
Thomas Davis |
44,048 |
952 |
|
|
Total |
$420,077 |
$231,064 |
Net Value of Obligations
|
Competitive |
$63,399,341 |
|
Section 8(a) |
43,365,618 |
|
Noncompetitive |
10,845,679 |
|
Set Asides (competitive) |
21,964,024 |
|
Total small business |
$139,574,662 |
Company Dollars Obligated
