Aerospace and defense industry - AZ Business Magazine March/April 2012

Aerospace And Defense Industry – Critical To Expanding Economy

Aerospace and defense industry is critical to expanding economy

When I’m asked to name one sector of Arizona’s technology community that is critical to expanding the strength of the economic recovery, I always sum it up in two letters: A&D  — the aerospace and defense industry. It’s a cornerstone industry for Arizona, as our state has seen groundbreaking innovation in this arena for decades.

Boeing, General Dynamics, Honeywell, Raytheon, Lockheed Martin, Northup Grumman and Orbital Sciences are just a handful of the state’s major industry players contributing to Arizona’s impressive resume. An Arizona economic impact study conducted in 2010 reported that compensation per employee in the Arizona aerospace and defense industry is approximately $109,000. This is 2.3 times the statewide average for all employed individuals. The study also reported when accounting for multiplier effects, the Arizona A&D industry in 2009 can account for a total of 93,800 jobs, labor income of $6.9 billion, and gross state product of $8.8 billion.

But keeping Arizona’s aerospace and defense industry healthy and at pace with the ever-changing knowledge-based economy requires competitive business policies and a coordinated effort among state and federal leaders. Recognizing the critical importance of this imperative, there has been a resurgent statewide support for A&D over the last few years.

A big step was taken when Gov. Jan Brewer created the Arizona A&D Commission. Its active members develop industry goals, offer technical support, recommend legislation and provide overall direction. Another milestone occurred when the Arizona Commerce Authority formed and designated the aerospace and defense industry as one of its foundational pillars. Through the efforts of these two organizations, a request for proposal was issued for the first ever Aerospace, Aviation & Defense Requirements Conference in Arizona. Hosted by the Arizona Technology Council in late January, this successful historic event offered a major opportunity for the A&D community to connect with potential new partners. Attendees also heard a multitude of informative speakers, including a gripping keynote address delivered by Gen. Philip M. Breedlove, the Vice Chief of Staff of the U.S. Air Force.

A new chapter in the state’s expanding role in A&D research also recently began when the Arizona A&D Research Collaboratory was formed. The organization brings leaders from Arizona’s A&D industries together with researchers from the University of Arizona, Arizona State University and Embry-Riddle Aeronautical University to work together to gain insight into future technological needs for A&D.

Although these initiatives and programs indicate that there’s a resurgence of attention on A&D in Arizona, there are several key elements upon which the industry leaders within the state must still focus. The industry can’t do it alone. We need a unified congressional delegation employing strategies focused on promoting the desirable, high-wage jobs that A&D bring to their constituents.

We also need states leaders to take the lead in advocating for federal A&D projects that are critical to the existence of the state’s industrial base. These efforts not only reap benefits to the large manufacturers but they are hugely significant to building a robust small business supplier base in the state.

Indeed there are great needs still to be met for achieving newly conceived and exciting goals for manned space flight, homeland security and connecting the world with ever-evolving modern communications technologies. With the proper support, Arizona’s aerospace and defense industry can be critical to meeting those needs.

Steven G. Zylstra is president and chief executive officer of the Arizona Technology Council.

Arizona Business Magazine March/April 2012