Case Study

Washington State: the ultimate aerospace cluster

Economic Value to the economy

They are called 'aerospace clusters' - where an aircraft manufacturer sets up shop and then acts as a magnet for parts suppliers, logistics and distribution companies, research organisations, design companies, training establishments, maintenance and support organisations and hundreds of related businesses - pulling in millions of dollars investment from around the world and generating thousands of well-paid jobs.

The world’s first and largest aerospace cluster is located in Washington State, in the northwest of the USA. It began 1916 with a single red barn in Seattle and now employs more than 132,500 people working in more than 1,350 establishments. According to Washington State’s 2014 aerospace strategy, aviation as a whole supported $76 billion in economic activity and paid wages totaling $11.5 billion, representing 11% of all wages earned in the state in 2012.

Washington is now home to 175 firms working directly in aerospace manufacturing, accounting for 94,200 jobs in 2012. Related businesses added an additional 38,300 jobs to the aerospace cluster, encompassing 1,350 firms.

By December 2013, Boeing alone employed nearly 82,000 people in Washington. In 2012, the company paid more than $4.6 billion to its 2,042 nearby suppliers. According to the Washington State Department of Commerce, aerospace exports accounted for 53% of all Washington State exports in 2013, totaling $43.6 billion, a 61% increase since 2011.

And the numbers will rise over the coming years as production of aircraft ramps up to meet the world’s demand for travel. At the Boeing Renton plant in Washington workers now produce 42 aircraft each month, with planned increases to 47 per month in 2017 and possibly 52 by 2019.

To be successful cluster businesses have to have a world view. Washington State aerospace companies are also vital links in the global supply chain for aircraft manufacturers around the world, such as Airbus, Bombardier, Embraer, COMAC and Mitsubishi Aircraft Company. Washington is second only to California in hosting US companies that supply parts to Airbus, Boeing’s European competitor.

With aerospace clusters growing around the world, Washington State has to compete increasingly intensively for new business. Aircraft manufacturers now have a huge choice of possible locations for final assembly lines and past activity is no guarantee of future success. But one major ingredient for attracting new business is access to a skilled workforce.

The University of Washington (Seattle) has become one of the leading public research universities in the US in support of new aerospace technologies while Washington State University (Pullman) is expanding its engineering programs in Everett as it assumes management of the University Center of North Puget Sound.