Despite growing uncertainty on Capitol Hill about future defense spending, more than $23.3 billion for troops, veterans and defense projects poured into the San Diego area last year, generating one out of every five local jobs, according to the San Diego Military Advisory Council.
Released Tuesday morning, the nonprofit’s eighth annual military economic impact statement showed that overall federal spending on bases, contractors, troops and veterans ticked up about $600 million from the previous year.
As the federal funding rippled through the local economy, it generated about $21.4 billion in additional economic activity, according to the data analysis performed by researchers at the Fermanian Business and Economic Institute at Point Loma Nazarene University.
To the Council’s executive director Randy Bogle, a retired Navy captain, the latest study shows that military remains the undisputed economic champ in San Diego and what’s good for America’s security is good for the region.
“We have everything right here,” said Bogle, pointing out the region’s good weather for year-round training, deep sea ports for warships and an ongoing “pivot” to Asia that will nearly double the number of vessels homeported in San Diego over the next two decades.
The rise in local defense spending was about half the 6 percent hike in military expenditures projected by the Pentagon for the federal fiscal year that ended on Oct. 1.
Overall, funding for America’s military and ongoing combat operations overseas dwindled about 15 percent to $580 billion since the passing of the so-called “sequestration” budget deal in 2011 to trim the federal budget deficit.
However, the survey’s researchers forecast a 2.4 percent increase in 2017 military spending in the San Diego area, pegging it at $23.9 billion.
While funding for defense contracts and the wages for more than 134,000 uniformed and civilian employees of the Department of Defense comprised nearly 80 percent of the direct federal spending in the San Diego region, the study also included compensation paid to 67,000 military retirees.
One out of every six American sailors is stationed in San Diego County as are a quarter of the nation’s Marines.
Another 166,000 county residents owe their jobs indirectly to the military, mostly thanks to defense contracts or purchases of goods and services by troops and their families, according to the survey.
Tourism tied to military installations also injected $151 million into the local economy in 2016, up $7 million from the previous year, according to the researchers.
That figure includes stays by out-of-town government officials and business travelers working on federal contracts, plus relatives visiting troops and civilian defense workers. The top attraction, however, remains San Diego’s Marine Corps Recruiting Depot, which graduates about 16,000 enlisted men annually during 42 ceremonies. They draw approximately 63,000 friends and family members annually, pumping $27 million into the local economy, mostly for hotels, food and entertainment, according to the study.
The study also spelled out problems that could cloud the region’s economic stability in coming years.
Calls in Washington, D.C., for slashing the $19.8 trillion national debt could trigger even deeper defense cuts, researchers wrote, so local, state and federal leaders must ensure that government policies “advance rather than impede” military operations across the region.
The San Diego Military Advisory Council called on these leaders to back legislation that will support California’s military facilities; neighbors to better integrate military members, veterans and their families into their communities; and businesses to diversify their customer base by finding new applications for the products and services that they sell to the Pentagon.
“We have to think about how these things impact military members, especially those in the (junior enlisted) paygrades of E-1 to E-4,” Bogle said. “If they’re married, they generally have at least one child. How are they living here?
“Schools are important. One of them is in the military and will be deploying fairly frequently. How are they along? Oftentimes, we find that they need assistance to live her.”
The Department of Defense directly employs 134,000 uniformed and civilian workers in San Diego County.
* Navy: 55,200
* Marine Corps: 51,300
* Civilian: 21,500
* Reservists: 6,300
Sources: Fermanian Business and Economic Institute, U.S. Defense Department