Case Study

Melbourne Airport: economic and aviation hub

Economic Value to the economy

Each international aircraft landing at Melbourne Airport in Australia contributes nearly A$240,000 visitor spending a year to the State of Victoria. While it has been recognised for years that airports can play a vital role in the local and regional economies of a nation, recent research is now able to quantify in detail exactly how much airports contribute through connecting communities, generating jobs and providing a focus of inward investment.

As part of the process of writing a long-term development plan, Melbourne Airport commissioned SGS Economics and Planning to undertake a Social and Economic Impact Assessment of the airport on the local community.

The study showed the number of jobs supported by Melbourne Airport has grown by 3.3 per cent a year between 2007 and 2011 to over 14,300 jobs which are directly related to the airport’s operation. An estimated 43,000 indirect jobs also rely on the airport’s operations. The airport’s employment figure is projected to grow to 23,000 by 2033. Key employment sectors include transport, postal and warehousing, retail, accommodation and food services, manufacturing and wholesale trade. The airport is responsible for 6% of the local region’s economy.

Around 7.9 million visitors arrive in Melbourne each year through the airport. They spend nearly $8.3 billion annually in the State of Victoria's economy – accounting for almost 50% of the total current tourism expenditure in Victoria.

The airport has been able to achieve an especially high level of investment in part because it is open for business 24 hours a day. This allows for the movement of an extra two million passengers a year and adds A$590 million to the Victorian economy through visitor spending. By 2033, the value of the curfew-free status will increase to an additional five million passengers a year with visitor spending totalling A$1.3 billion.

By 2033 the airport’s contribution to GSP is forecast to increase to $3.2 billion and will support up to 72,000 jobs indirectly.

As well as being able to understand the macro economic impact of the airport researchers can now provide more detailed views on the economic effect of single projects. In July 2013 the government approved the construction of an 80,000 square metre warehouse in Melbourne Airport Business Park. This single enterprise will generate approximately 700 operational and administration jobs. In addition, 150 jobs will be created during the construction of the warehouse.