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Pages 4-31

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From page 4...
... 4 C H A P T E R 1 Understanding Changes in and the Relationship Between Commercial Air Service and Regional Economic Activity The economic impact of airports has traditionally been estimated to provide the public with information on how and to what extent the facility contributes to an area's employment or to justify an expansion of or investment in the airport. It is measured based on employment at the airport (and in nearby related properties such as off-site rental car facilities or parking lots)
From page 5...
... 5 National Trends in Commercial Air Service As the past few decades have vividly demonstrated, commercial air service and economic development in the U.S. have experienced profound and unanticipated changes.
From page 6...
... 6 The FAA classified another 119 non-hub airports as "commercial service" airports. These facilities handled a total of just under 593,000 enplanements, or an average of less than 5,000 annually (or about 14 passengers daily)
From page 7...
... 7 Figure 2 summarizes the changes in air traffic as captured by the amount of seating capacity offered by airlines and purchased by passengers. Seat capacity is shown in terms of Available Seat Miles (ASMs)
From page 8...
... 8 Figure 3: Increasing Load Factors Source: BTS Instability in Fuel Prices Wildly fluctuating fuel prices complicated airline management. As the industry was recovering from the downturn following the Sept.
From page 9...
... 9 Figure 4: Change in Jet Fuel Prices (Dollars per Gallon)
From page 10...
... 10 Figure 5: Change in Industry Fuel Consumption and Fuel-Related Costs Source: BTS As a percentage of total airline operating costs, the amount attributable to fuel became the single largest cost for the industry, rising to 35-40 percent in 2009 compared to 15 percent in 2001. This was a result of both the rise in fuel-related costs and a decrease in costs attributable to labor.
From page 11...
... 11 Figure 6: Labor and Fuel as a Percent of Airline Operating Costs 2000-2019 Source: BTS Airline Profitability Having suffered significant financial losses from both downturns, U.S. airlines made strategic decisions to manage available capacity in ways to more closely track demand.
From page 12...
... 12 Figure 7: Airline Operating Profits / Losses 2000-2019 Source: DOT BTS Database P-1.2 (air carriers with $20 million of more of operating income)
From page 13...
... 13 Hub operations also ceased at several other airports that served as hubs for smaller airlines (e.g., Midwest Express operated a hub at Milwaukee Mitchell International Airport and Midway Airlines operated a hub at Raleigh–Durham International Airport)
From page 14...
... 14 Figure 9: Number of Regional Aircraft in Service in 2020 and Change Since 2010, by Aircraft Capacity Category Source: FAA Aerospace Forecast Fiscal Years 2020-2014, Table 27 ACRP Report 142 highlighted some of the changes in air service that have occurred at smaller communities since 2000. The airports of interest were FAA-defined small hubs and non-hubs.
From page 15...
... 15 Connectivity at Small Airports ACRP Report 142 also noted the impact of a loss of air service at small communities on the extent to which those regions were connected to the national and global economies. Citing analyses from researchers at the Massachusetts Institute of Technology (MIT)
From page 16...
... 16 Nearly half of today's Part 121 qualified pilot workforce face federally mandated retirement within 15 years, and 15 percent must retire within five years. Globally, in its 2021 Current Market Outlook, Boeing forecasts that the worldwide need for new pilots will reach 612,000 by 2040, with 130,000 being in North America.
From page 17...
... 17 This section provides an overview of the fundamental metrics of social and economic change that are most relevant to commercial air service. Included are summaries of those data, their definitions, and their sources.
From page 18...
... 18 Figure 11: U.S. Combined Statistical Areas and MSAs Source: U.S.
From page 19...
... 19 Employment Total U.S. employment (full and part-time)
From page 20...
... 20 Employment by Industry Breakdowns by industry for economic data are a vital component of data granularity because they enable an understanding of the relative size and activity of specific industries in the economy (e.g., air transportation) which, in turn, makes economic impact analysis possible.
From page 21...
... 21 – Employment in manufacturing (durable and non-durable goods) dropped by 4.5 million (26 percent)
From page 22...
... 22 Change in Income Multiple measures of personal income provide indications of the potential strength of regional demand for air services. The major elements of personal income include wages and salaries, interest and dividends, and transfer payments like Social Security.
From page 23...
... 23 Figure 15: Differences in Per Capita Personal Income: U.S.
From page 24...
... 24 Figure 16: Variations in Average Household Incomes Among Selected Large MSAs, 2019 Source: Census Bureau, American Community Survey Brief Change in Earnings The Bureau of Labor Statistics (BLS) reports data on earnings of different groups in the labor force.
From page 25...
... 25 Figure 17: Changes in Median Weekly Earnings of Full-Time Salary and Wage Earners 2000-2019 (Quarterly Averages, Seasonally Adjusted) Source: BLS Current Population Survey Foreign Direct Investment Direct investment is a category of cross-border investment associated with a resident in one economy having control or a significant degree of influence on the management of an enterprise resident in another economy.
From page 26...
... 26 Figure 18: Foreign Direct Investment in the U.S. by Region (in $ millions)
From page 27...
... 27 Figure 19: Changes in Passenger Traffic and GDP (indexed to 2002) Source: InterVISTAS analysis of data from BEA and BTS.
From page 28...
... 28 metropolitan areas, reporting that a 10 percent increase in passenger traffic raises total employment by 0.9 percent and service employment (defined as those wholesale and retail trade; finance, insurance; and real estate; services; government transportation; and public utilities employment) by 1.1 percent suggesting employment gains far beyond the airport.
From page 29...
... 29 Figure 20: Airports' Role in the U.S. Economy Source: Adapted from ACRP Report 132 ACRP Report 218 discussed the contributions of air service to local economic activities specific to small hub and non-hub airports.
From page 30...
... 30 Air Service and Employment in Specific Industry Sectors Building on the initial studies that linked air service and regional economic development, researchers began to refine the analyses to link air transport and particular sectors of the economy. Certain industry sectors have a relatively great reliance on air transport as a part of their business.
From page 31...
... 31 Sheard (2014) extended the analysis to cover the relationship between air service and "tradeable services" (i.e., services that could be produced locally but consumed outside the area, such as insurance, financial services; or PST services)

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