Assessing the Economic Impact
for Florida of the End of the Shuttle
Program
UWF Office of Economic Development and Engagement
Final Report
September 2011
Project Team:
Arnab Biswas, Ph.D.
[email protected]
Rick Harper, Ph.D.
[email protected]
Brice Harris, Ph.D.
[email protected]
Final Report
September 2011
Project Sponsor:
This work was funded by an SBA portability grant to the Florida Small Business Development
Center Network to assist in transitioning businesses impact by the downsizing of NASA on the
Space Coast. The FSBDC network is designated by Florida statute as the provider of business
technical assistance for the State of Florida.
Assessing the Economic Impact of the Shuttle Shutdown
The final countdown has ended as NASA’s Space Shuttle program shut down after more than 30 years of
manned space flight. The Space Shuttle was originally to be retired in late 2010, but made its final flight
out of Kennedy Space Center (KSC) earlier this year. This extension led to Atlantis being the final Space
Shuttle mission that could help stock additional supplies on the international space station. The program
that had been a boon to the local economy surrounding KSC (especially Brevard County) for decades will
clearly slow Florida’s economy recovery as jobs depart and assets are unwound. According to a state
study, NASA-related activities boosted Florida’s economy by $4.3 billion in fiscal year 2009, and
generated almost 40,000 jobs. The shutdown of the Shuttle program will consequently result in
substantial job losses in a state that has been hit particularly hard by the Great Recession of 2007 - 2009.
Florida was the hub of American space exploration long before Apollo 11 in 1969 took men to the moon
and brought them back safely to Earth. The region around the Kennedy Space Center at Cape Canaveral
has long been known around the world as The Space Coast. After 133 space shuttle missions, only one
shuttle (Atlantis) remained in service before the retirement of the vehicle fleet. The retirement
schedule includes withdrawal of all reusable orbiters (orbital vehicles) and associated hardware from
service. The orbiter generally carried astronauts and payload such as satellites or space station parts
into the space with the help of solid rocket boosters attached to an external fuel tank. The decision to
end the Shuttle program was taken in 2003 by then President George W. Bush in the aftermath of the
Space Shuttle Columbia disaster. President Bush then ordered NASA to start a new program called
Constellation in place of the Shuttle program.
It was his “vision for space exploration” to send
astronauts back to the moon by 2020 and eventually on to Mars. NASA spent $9 billion over the past
four years before the Constellation program ended in January 2010 when President Obama’s budget
called for a complete stop in NASA’s Constellation program, the rockets (e.g. Ares I & Ares V) and a new
generation of spacecraft (e.g. Orion Capsule and the Altair Lunar Lander) for human spaceflight that
NASA has been working on for the past four years to replace the space shuttles. Instead, the Obama
administration has proposed that private companies take over the space shuttles and use commercial
rockets to ferry astronauts and supplies to the space station – a job that those new generation
spacecraft under Constellation were capable of performing.
3
The Obama administration noted that the Constellation Program is behind schedule, over budget and
overall not very inventive in terms of resending where Apollo had taken astronauts a generation before.
The administration would instead invest in scientific research on deep space exploration as well as
development of technologies to allow humans to transport necessary supplies to work and stay longer.
To be more explicit, the Obama administration wants NASA to work on developing a new "heavy-lift"
rocket that will carry humans and robots to explore beyond low Earth orbit and eventually to the planet
Mars years in the future -- and possibly even decades or more. Under the most recent Obama Plan,
instead of operating NASA made spacecraft, Russian Soyuz capsules will be used to ferry U. S. astronauts
to and from the International Space Station for the time being – at least a decade. Meanwhile, instead
of using the Constellation spacecraft there will be funding for private companies such as SpaceX and
Boeing to develop capsules and rockets that can be used as space taxis. These companies may take
crew and cargo on fixed-price contracts to and from the International Space Station, a radical change in
the way NASA has done business for the past 50 years. On October 11, 2010 President Obama signed
the NASA Authorization Act of 2010 (S.3729) bill reauthorizing $58.4 billion in funding for the space
agency through the fiscal years 2011 to 2013. The bill appropriates $19 billion for 2011; $19.45 billion
for 2012; and $19.96 billion for 2013, and lays out a plan for the next several years of the agency
including the development of a heavy-lift launch vehicle to be developed by 2016 and to launch an
additional shuttle flight before the program ends in June 2011. The bill also extends the International
Space Station program to 2020. In addition to human space flight and exploration, the bill also
stipulates funding for a diverse range of other activities, including aeronautics research and
development and scientific research involving more earth-related goals like using space technology for
climate-change research, hurricane-tracking and earthquake observations as well as other activities.
Under the proposal, while NASA would receive $100 billion in total over the next five years (FY 20112015) many central Florida workers fear they will lose their jobs during the interim following the
retirement of the Shuttle Program. With the impending shut down of the program accompanied by the
cancellation of Constellation Program, concern is growing in Florida and around the country about the
future of the substantial workforce currently employed both directly and indirectly by the program. One
projection by Brevard Workforce previously indicated that 23,000 jobs with direct or indirect ties to the
space industry (9,000 jobs in NASA and another 14,000 public- and private- sector jobs) could be lost in
Florida within a year as the shuttle stops flying. The organization in a report (Aerospace Workforce
4
Outlook Report – Phase III) had previously tabbed direct job losses to number 7,000 with the upcoming
retirement of the space shuttle program. The numbers were increased following the cancellation of
Project Constellation and other space initiative outlined in the federal budget for 2011. “Our
unemployment rate is going to skyrocket,” Lisa Rice, president of Brevard Workforce told Florida Today.
Highlights of the report include the fact that some 88 percent of shuttle workers live in Brevard County,
with 58 percent living in Central Brevard, an area expected to be hard hit by the end of the shuttle
program.
Kennedy Space Center, which is located in Cocoa, has been the major economic anchor for the Brevard
County and the surrounding Central Florida Region for years. Brevard County, which is the primary
launch site for most of NASA’s space mission, is also the home of tens of thousands of on/near-site KSC
workers who are involved in maintaining and launching the shuttle reside, processing payload, mission
integration and technology development as well as planning, operation and management of KSC
employees, infrastructure, environment and the KSC Visitors Center. In FY 2009, the total on/near-site
KSC employee was 15,248, of which 94% is from the Brevard County. This on/near-site worker
population is due to employment through both NASA and many of its private contractors (such as
United Alliance and ATK). KSC and NASA prime contractors employed the overwhelming majority (78%)
of on-site workers. Federal civil service workers employed by KSC and other NASA Centers made up an
additional 15% and the remainder was employed by the KSC Visitor Center and other space related
tenant contractors. Total earnings for all space related workers at KSC were $1,207 million dollars in FY
2009. Over 99% of these wages were paid to residents of Brevard and other Central Florida counties. A
large majority of the workers at KSC are highly trained engineers, managers and technicians that
command relatively high salaries. Accordingly the average annual salary for the work force at KSC was
over $80,000 which was twice the salary that was earned by the average Brevard County worker. The
injection of outside money into Florida economies both through direct purchases of goods and services
from contractors and the direct payment of earnings to workers totaled $1.96 billion in FY 2009.
The presence of KSC’s Visitor Center is another source of economic stimulus in Florida. KSC’s Visitor
Complex welcomed approximately 1.6 million visitors in FY 2009. Out-of-state residents accounted for
82% of these visitors, spending a little over $71 million on goods and services provided by the visitor
5
complex. All of the salaries paid by KSC’s Visitor Center went to Brevard and other Central Florida
residents in an amount of $18.6 million that is attributable to only out-of-state visitors. The visitor
complex spent $27 million on other non-labor purchases reflecting a portion (63%) of the procurement
purchases made only from Florida firms, only Florida firms. This leads to a total outside injection of
$45.6 million. It was estimated that the total local (Brevard and other Central Florida counties) spending
for lodging, food, car rentals and other miscellaneous items by out-of-state business visitors who came
to KSC in FY 2009 was $6.7 million. The total injection of outside money into Florida’s economy by all
KSC based activities was $1.97 billion in FY 2009. 91% percent of this spending was conducted on-site at
KSC. Total direct spending in Brevard County was $1.77 billion. Direct spending in other Central Florida
counties and other counties in Florida totaled $159 million and $40 million, respectively.
Because of the presence of the KSC, many a bar, restaurants, and other local retail businesses including
hardware store or electrical store have thrived. This first round of direct spending eventually translates
into a secondary impact on the local businesses that supply goods and services to NASA contractors and
employees. These businesses, in turn, pay wages to their employees and buy goods and services from
their own suppliers and the process continues through many subsequent rounds of purchases. The total
impact of all KSC/NASA activities in Florida is the sum of the initial injection of earnings and commodity
purchases plus the subsequently generated impact of these secondary injections. In FY 2009, this total
impact in Florida was $4.3 billion in output, $2.2 billion of household income and 38,938 jobs. This
activity also generated $241 million of federal taxes and $93 million of state and local taxes. The largest
share of the impact—98% of the output impact, 99% of the income impact and 99% of the employment
impact—occurred in Central Florida. Compared to FY 2008, the monetary injections by KSC and other
NASA Centers into Florida’s economy in FY 2009 showed a slight increase over that of the previous year.
However, according to the latest economic impact study by KSC, the total injection of outside money
into Florida’s economy by all KSC based activities was $ 1.83 billion (FY 2010) which is an 8% decline
from the previous fiscal year. This decline in part is due to the impending retirement of the shuttle
program, according to the information shared by CFO office at KSC. The shuttle budget was
approximately $100 million lower in FY 2010 versus FY 2009. Constellation program was also approx.
$100 lower in FY 2010. These two programs account for the 8% reduction. In spite of that such
6
injection of outside money into the state and local economies along with the subsequent indirect
transactions that were generated by this spending resulted in a total of $4.1 billion in output, $2.2 billion
in household income and 33,049 jobs in FY 2010 throughout Florida. The injections also generated $314
million of federal taxes and $134 million of state and local taxes. The decrease in injections led to a 5%
reduction in the total state-wide output impact. The total number of jobs also plummeted by 15%
throughout Florida while the space related workforce at KSC alone declined by 10% from the FY 2009.
Most (94%) of the employees at KSC lived in Brevard County whereas, over 1,000 workers commuted
from nearby Central Florida counties and a small number of workers lived elsewhere in the state.
Overall, 87% of the total employment impact along with 98% of the total income impact occurred in
Central Florida due to such injection of outside money in FY 2010.
The result of this economic analysis makes it clear that the John F. Kennedy Space Center continues to
be a boon to Brevard County and the surrounding Central Florida Region. Its economic presence and
importance have grown tremendously over the years and has provided a great source of high quality
economic diversity to Central Florida and the state’s service based economies. However, the situation
will change once the shuttle program is over and the “Space Coast” may take quite a hit economically.
Many fear the impending end of the shuttle program will bring about a repetition of the economic
devastation of 1975, when NASA abruptly cancelled the Apollo program; everything from rocket science
to real estate was impacted, practically overnight. This is the second time in NASA’s history that they’ve
had to wind down a human space program, the first being the Apollo mission which ended in 1972. After
the end of Apollo, Brevard County saw a dramatic downturn in the economy, as 10,000 workers left the
region to find jobs and unemployment rose to 15 percent. The local unemployment rate continues to
hover at or near 11 percent, largely due to nationwide economic problems and particular weakness in
Florida. Housing and construction have taken a hit as well, and will continue to suffer as the area sees
the space workers leave. It would devastate an economy already reeling from a massive foreclosure
rate and plummeting home values. While some shuttle workers had hoped to get jobs developing a
rocket and capsule to take astronauts back to the Moon by 2020, the Obama administration says it
wants to scrap the program following an independent panel’s finding that NASA lacks the resources to
see it through. Florida already reeling from the collapse of the housing market and the effects of the
Great Recession, and faces a serious loss of revenue from both the evaporation of tourists who come to
watch the launches, and from the potential relocating of NASA personnel related to the shuttle program
7
away from the KSC. While the NASA activities contribute about 0.5 percent of the total Florida GDP, this
lost revenue could impact the state just as it begins to recover. Sales will drop and jobs will be lost
locally as Florida’s signature, half-century-old space economy risks being eclipsed by the end of the
space shuttle program.
According to the survey results by the Small Business Development Center at Brevard Community
College, 42% of the respondents consider the retirement of shuttle program as one of the biggest
concerns for the economy in the Brevard County. Among those who identified unemployment as
another concern, 49% hold the end of shuttle program responsible. Again, of all the respondents, 75%
agreed that their businesses will be affected in a negative way when the Space Shuttle is retired.
Personal or professional service (41%) constitutes a major part of this business group followed by
constructions (10%), retail (9%), real estate (6%), manufacturing (4%), restaurant (2%), and others (28%).
On an average 60% of these businesses employ less than 5 workers, while 7% employs more than 30
workers. In another scenario where the businesses have already suffered due to the recent economic
crisis, 83% of them believe that the end of shuttle program will exert an additional blow.
The most dramatic job cuts however will be among the private contractors who directly and indirectly
work with NASA supporting the launch and related activities. According to an economic impact study by
NASA in Florida, KSC alone managed 1,291 active contracts in FY 2009 with a total value of $1.057
billion. Among 1,655 contracts throughout Florida, by far the largest was the Space Shuttle Program’s
Space Program Operations Contract (SPOC), managed by Johnson Space Center in Texas. United Space
Alliance (USA), the company founded as a partnership between the two major American aerospace
firms, Lockheed Martin and Boeing was selected as the single prime contractor to perform SPOC. The
portion of the SPOC contract performed in Florida through United Space Alliance was approximately
$572 million in FY 2009. While NASA utilizes the services of contractors like USA to perform SPOC, it also
engages other contractors like EG&G Technical Services and Abacus Technology Corporation to perform
other contracts that are not 100% shuttle related. For example, contract like CAPPS (Cargo and Payload
Processing Services) does most of the International Space Station processing while IMCS (Information
8
Management & Communications Support) does IT services for the entire NASA Center.1 These prime
contractors like USA (SPOC), Boeing Company (CAPPs), Abacus (IMCS), EG&G (ISC) in turn utilize services
from the sub-contractors. There are other contractors who also support the Shuttle during the time of
launch activity on an on-call basis. This workforce is typically not included in program estimates of the
Shuttle workforce as their funding does not come from program sources, rather from institutional base
support sources. An Aerospace Workforce Outlook study by Brevard Workforce Agency (January 2010)
then estimated the Shuttle workforce including prime, sub-tier and related base support workforce level
to be approximately 2,000 civil servants and 9,160 Shuttle-related employees in the state of Florida,
with approximately 6,140 of those employees, with the United Space Alliance (USA). Another source
(CFO office at KSC) indicates that the USA workforce at KSC had an average headcount of 5,898 in
FY2009, and the total estimated shuttle-related payroll for USA Florida based employee accounts for
$462,098,586. 2
To gauge the potential economic impact of the end of the Shuttle program this study actually estimates
how the injections of outside money due to the shuttle program influence the local (Brevard County) as
well as the overall Florida economy. These injections enter the economy through the channel of direct
purchases of goods and services by the contractors and direct employee income payments. Estimates
reported in this study are based on the injection of outside money into Florida’s economy through SPOC
contract. This is largely because SPOC is a 100% shuttle-related program and that the expenditure
information for other partially related contracts are not readily available. Thus these estimates are to be
considered as the lower bound impacts. The total injection of outside money into Florida’s economy
due to SPOC contract was approximately $534 million in FY 2010, and which was down 8% from the FY
2009 level after controlling for inflation. Exhibits 1 and 2 show the regional distribution of SPOC
expenditure separated at wage and non-wage components for the FY 2009 and 2010 respectively. In
the following exhibits, the Central Florida region consists of Brevard, Flagler, Lake, Orange, Osceola,
Seminole and Volusia Counties.
1
2
A list of all major aerospace contractors who support the Shuttle Program is reported in Appendix A.
Occupational distribution of the USA workforce at KSC is provided in Appendix B.
9
Exhibit
1
10
Exhibit
2
The Minnesota IMPLAN Group (MIG) provides the software and the annually updated structural data
needed to formulate the set of regional input-output models developed for this report. These economic
models explicitly account for inter-industry linkages (supply relationships). The “input-output” models
recognize that an increase in the demand for its products or services in turn requires an industry to
purchase more goods and services used as inputs from other industries in the economy. The effect on
regional production resulting from successive rounds of inter-industry linkages is referred to as the
indirect effect. The resulting increases in regional production also lead to expansions in employment
and labor income thereby expanding sales and production throughout the regional economy. These
economic impacts are referred to as the induced effects. The successive rounds of production, spending
and more production result in economic multiplier effects.
Likewise, regional economic activity
generated by shuttle-related SPOC contracts in Florida begins with the direct purchases and the
household income payments. This first round of spending indirectly generates a secondary set of
economic interactions in the local businesses that supply goods and services to NASA contractors and
employees. These businesses, in turn, pay wages to their employees leading to expansions in output,
employment and labor income throughout the regional economy. The successive waves of purchases
and earning payments to workers eventually result in economic multiplier effects, where the final or
11
total increase in regional production, income and employment, respectively, is larger than the first
round (or “direct”) increase in production, income and employment.
For the purpose of tracing all of these successive rounds of generated economic activity using complex
economic-multiplier models that utilize a highly detailed breakdown (440 economic sectors) of the
economy, the total expenditure of the SPOC contract is allocated to relevant commodity categories.
However, in the absence of the actual expenditure information for each relevant category, this
categorical allocation is based on the ratio calculated from Exhibit 3 of the economic impact studies of
NASA in Florida published by KSC for both the FY 2009 and 2010. Separate models were built for Brevard
County, Central Florida and the state of Florida as a whole.
The total impact shown in Exhibit 3 and 4 is the sum of the initial injection of earnings and commodity
purchases plus the subsequently generated impact of these injections only due to SPOC contract.3 The
injection of outside money resulted in a total economic impact of about $1.2 billion in output, $428
million in household income and 8,256 jobs in FY 2010 throughout Florida.
The injections also
generated $90 million of federal taxes and $38 million of state and local taxes. These estimates are
reported in 2011 dollars for the purpose of comparisons, and should be considered as the lower-bound
impacts. The largest share of the impact—64% of the output impact, 65% of the income impact and 71%
of the employment impact—occurred in Brevard County.4 This study also that an 8% decrease in initial
injections from FY 2009 to 2010 has led to a 9% reduction in the total state-wide output impact.
3
A breakdown of the total quantitative economic contribution of these activities in terms of a direct effect, an indirect effect
and an induced effect is reported in Appendix C.
4
In this study, our IMPLAN estimates of employment as a direct impact of the first round spending (see Appendix C, Table 3 &
4) reports much lower number than the actual workforce reported in Appendix B. This discrepancy of about 2000 workforce
under USA at KSC occurs due to the approximation of SPOC budget allocation to relevant commodity categories in the absence
of proper data.
12
Exhibit
3
13
Exhibit 4
Exhibit 5
14
Exhibit 6 shows the impact multipliers that provide a summary measure of the effectiveness of a
particular economic activity. In this study, multipliers are calculated as total impact divided by the initial
injection for each of the three categories: Output, Income and Employment. Only multipliers for FY
2010 are reported in Exhibit 6 as they are almost indifferent between the years. The jobs multiplier for
the state as a whole indicates that each direct on-site job due to SPOC contract is multiplied into 2.35
total jobs throughout the Florida economy. The Florida income multiplier indicates that each dollar of
direct wages that was paid to SPOC workers resulted in $1.91 of total income in the State. Finally, the
output multiplier shows that each dollar of direct total spending for commodity purchases and wage
payments translated into $2.14 in total statewide output. Similar interpretations apply to the Central
Florida and Brevard County multipliers.
Exhibit 6
With the end of the space shuttle program, USA will downsize drastically. After the last shuttle mission,
United Space Alliance will likely employ half as many workers as it did at the height of the space shuttle
program and will concentrate primarily on research and development and support for the International
Space Station. The reduction in workforce will affect multiple disciplines and multiple organizations
across the company. The economic effects of potentially thousands of highly paid employees being let
15
go in these communities will have a trickle-down effect for local businesses. However, it is not clear
about the immediate impact of the Shuttle retirement on the civil service workforce as the timing and
content of future exploration work assignments are to be decided by the White House.
In October of 2009, nearly 300 employees of the United Space Alliance were let go, and most of these
accepted early retirement. Long-time employees are now forced to find work in what has been called
the worst economic condition since the Great Depression. Meanwhile new employees, fresh out of
college are forced to compete with individuals with 20-or-more years of experience in their profession.
The company just completed its most recent round of cuts on April 8 (2011), shedding 535 KSC jobs. The
cuts add to the nearly 2,900 USA workers who have lost their jobs to date as NASA winds down the 30year shuttle program. Roughly 2,100 of those lost jobs so far have come from Florida over five layoffs
since October 2009, leaving KSC only with 3,303 USA workers. Layoffs at KSC since October 2009 have
harmed many businesses surrounding KSC and contributed to Brevard County's double-digit
unemployment.
USA announced (April 15, 2011) its plans to reduce its workforce about half of its current workforce
following the last launch that was previously scheduled on June 28. USA anticipates to layoff between
2,600 to 2,800 of its total of 5,600 employees at locations in Florida, Texas and Alabama in late July and
early August, shortly after the scheduled completion of the final shuttle mission this summer. Those
layoffs will include 1,850-1,950 in Florida, 750-800 in Texas, and 30-40 in Alabama. These employees
run the gamut from general support personnel to engineers. Company officials said that they would
implement such workforce reduction because of the completion of tasks related to the day-to-day
operations of the shuttle fleet. This will leave the KSC area with roughly 1,400 employees, who will
decommission the shuttles, help build a new NASA crew capsule or work on a variety of smaller
contracts, according to USA spokeswoman Tracy Yates. Local work force officials think this upcoming
round of layoffs by NASA's lead shuttle contractor will be Brevard County's biggest single loss of jobs
since the end of the Apollo program in the 1970s. The layoffs are no surprise as the shuttle program
approaches retirement, but Friday's announcement provided a clearer timeline, with the Florida cuts
mostly in July. By September 2012, the alliance expects to have fewer than 250 workers left, most of
them assigned to the Orion project, NASA’s next-generation crew exploration vehicle.
16
The ending of the shuttle program is expected to result in the loss of at least 7,000 or so direct jobs tied
to the shuttle program at Kennedy Space Center (Aerospace Workforce Outlook, January 2010).
Another 14,000 indirect jobs are expected to be lost as a result of the space layoffs, including, most
likely, employees at businesses near KSC. The total job loss of about 21,000 or so throughout Florida is
also confirmed by this study. According to the Brevard Workforce Report, there were approximately
9,000 shuttle workforce which if multiplied by the State of Florida multiplier (2.35) would yield about
21,000 jobs. All along the routes taken by KSC workers, businesses large and small are feeling the
impact of the shuttle program's end. With today's hundreds and an even bigger layoff expected this
year after the final shuttle flight, the outlook among owners and employees is dark. The toughness will
linger, experts suggest, well beyond the end of the actual layoffs. "There is an expected job-loss ripple
effect, and we are unsure when we will start to see those effects to our local economy," said Lisa Rice,
Brevard Workforce president. This study also indicates that other areas where the phase out of Space
Shuttle Program can result in an average loss of at least $95 million and $40 million in federal and state
tax revenue, respectively. The average output loss is also very high, at least $1.2 billion, with Brevard
County taking the most of the hit (66%).
According to William Dimmer at KSC, the actual estimates of numbers of personnel changed weekly as
the program wound down, launch schedules were delayed, new tasks were added to close-out, etc.
The shuttle transition and retirement activity began with the final launch and lasts for 24 months. Thus
there will be zero shuttle funding and zero personnel working under this program in late 2013.
Following the last mission, the vast majority of the contract workers will be terminated or will retire.
Some workers will be required to transition and disposition all shuttle-related property and facilities, to
prepare the 3 shuttle orbiters for transport to their new museum homes, and to conduct a myriad of
things required for an orderly shutdown of the 30 plus year old program. NASA civil service workers will
retire, support other NASA programs or direct and assist in the termination of the program.
Although it was known to the shuttle workers for quite some time that the space shuttle program was
scheduled to end, many had been hoping to find work with NASA's next human spaceflight program.
But NASA has so far been unable to develop a new rocket that can quickly fill the gap after the last
17
shuttle flight. Congress passed a law last year requiring NASA to build a new rocket from parts of the
shuttle's launch system by December 31, 2016. However, as per NASA it is an impossible task based on
the money that Congress has authorized for the project. However, the FY 2012 budget for the Space
Shuttle Program will continue to support the planning, cost-effective utilization, and responsive
disposition of processes, personnel, resources, and real and personal property. The majority of the
requested FY 2012 funds for the Space Shuttle Program are to cover the pension liability for the Space
Shuttle Program's prime contractor. As of January 2011, the cost is estimated to be about $550 million.
However, this budget will continue to fluctuate until the formal pension plan ends. The residual funding
will be used to cover Space Shuttle closeout costs that would otherwise require FY 2013 funding;
however, if there is a shortfall, it will reduce available Space Shuttle funds for closeout.
Following the last shuttle flight, USA is expected to play a role in the process known as "transition and
retirement" that prepares shuttles for public display and closes down or renovates KSC facilities for new
uses. But the scope of that work is not yet determined, Tracy Yates (Company Spokeswoman) said. With
the new strategy of government encouraging for commercial development of space transportation
systems, USA seems optimistic about the future. Meanwhile many will lose their jobs, and this is going
to be the largest layoff since Apollo days according to Lisa Rice, president of Brevard Workforce, which is
using a $15 million emergency federal grant to help the laid off aerospace workers find jobs. USA
President and CEO Virginia Barnes said in a statement that although it is difficult to bid farewell to those
immensely talented shuttle workers, their endeavor is to make this transition as smooth as possible for
the latter.
Conclusion
Over the years, the space coast region (Palm Bay-Melbourne-Titusville) has lost a net 6,800 jobs, which
is more than any of the 21 other metro areas statewide. Where more than half the metros in Florida are
now gaining jobs as compared to the previous year, the loss of jobs in the space coast region stands in
sharp contrast. What worsened the matter more is the fact that the Shuttle shutdown happened almost
at the same time as the deepest and longest recession since the Great depression. Although recently the
region is trying to revive its once Space Coast identity with a small but growing cluster of jobs connected
to commercial space exploration, “brain drain” of talent is inevitable with the region’s persistent double
digit unemployment rate since June 2009. In conclusion, while the economic impact of such alternative
18
initiative by Obama administration is yet to be seen in the long run, with the end of the shuttle program
the short run impact on the local as well as the Florida economy will be devastating. Again, in the postrecession period when U.S. state and local governments are shaped by budget deficits, fledgling privatesector efforts to carry Americans into space for fat fees appear to be nowhere getting traction.
Data Sources: Most of the data and numbers reported and used in this study are based on reports and
data provided through the Office of KSC’s Chief Financial Officer or found on the KSC internet site.
Numbers reported in the impact section of the report were generated by the economic impact models
constructed for this study. Information has also been gathered from various newspapers and internet
resources.
19
Appendix A
Shuttle Contracts by Major Companies
SPOC (Space Program Operations Contract)
United Space Alliance (USA)
- Responsible for all Shuttle Element Processing,
- Ground Operations, Launch and Recovery
SPOC (USA Sub-contractors)
Boeing Company (Orbiter Engineering Services)
Pratt-Whitney Rocketdyne (SSME Processing)
Wiltec (Cleaning Services & Labs)
Launch Coast Services (Logistics)
Troutman Technical Services (Technical Training)
Spherion (Contract Labor Specialties)
8 Small Companies (Miscellaneous Services)
6 Companies (Construction)
CAPPS (Cargo and Payload Processing Services)
Boeing Company
- Responsible for pre-launch processing of payloads for Shuttle and International Space Station.
CAPPS (Boeing Sub-contractors)
Jacobs Technology (Facilities O&M)
Creative Management Technology
All Points Logistics (Logistics Services)
Indyne (IT Services)
Yang and Alenia
USTDC (University Affiliated Spaceport Technology Development)
Arctic Slope Research Corporation
- Provide engineering services to KSC Various Center Customers
IMCS (Information Management & Communications Support
Abacus Technology Corporation
- Provide IT and COMM services in support of Shuttle Station, Payload Carriers and Launch services.
20
Sub-Contractor …. Analex Inc.
ISC (Institutional Services Contract)
EG&G Technical Services
- Provides base operations support to KSC including Facilities maintenance, O&M, roads and grounds.
EG&G ISC Subcontractors:
Northrup Grumman (Protective Services)
Dynamac / Bionetics (Life Sciences)
Sierra Lobo (Propellant Services)
Wiltec (Cleaning Services)
Yang Enterprise
OTHERS
KISS (KSC Institutional Support Services)
REDE/Critique JV
MESC (Medical & Environmental Support Contract)
Innovative Health Applications
SMASS (Safety and Mission Assurance Support Services)
Millennium Engineering, Inc
SRM LAUNCH SERVICES
ATK Corporation
LAUNCH AND MISSION SUPPORT SERVICES
Lockheed Martin Astronautics
Source: Aerospace Workforce Outlook Report—Phase III by Brevard Workforce (January 2010)
21
Appendix B
FY 2009 Occupational Distribution of the USA Workforce at KSC
Clerical and Administrative
400
Engineering and Scientific
2,009
Executives and Managements
447
Professionals
986
Semi Skilled
161
Technicians and Skilled Craft
1,895
Total
5,898
FY 2010 Occupational Distribution of the USA Workforce at KSC
Clerical and Administrative
370
Engineering and Scientific
1,854
Executives and Managements
424
Professionals
900
Semi Skilled
144
Technicians and Skilled Craft
1,757
Total
5,449
22
Appendix C
Table 1: Impact Summary for the State of Florida FY 2009
Employment
Labor Income
Output
Impact Type
Direct Effect
3,675
244,377,900
603,648,598
Indirect Effect
2,379
108,027,864
323,494,052
Induced Effect
2,827
116,091,140
368,323,006
Total Effect
8,882
468,496,904
1,295,465,657
Table 2: Impact Summary for the State of Florida FY 2010
Employment
Labor Income
Output
Impact Type
Direct Effect
3,518
224,719,579
549,560,420
Indirect Effect
2,153
97,551,937
292,178,559
Induced Effect
2,586
106,164,119
336,826,898
Total Effect
8,256
428,435,635
1,178,565,877
Table 3: Impact Summary for the Brevard County FY 2009
Employment
Labor Income
Output
Impact Type
Direct Effect
3,650
204,633,807
528,352,686
Indirect Effect
1,258
49,180,014
146,995,152
Induced Effect
1,404
49,005,411
155,494,929
Total Effect
6,312
302,819,232
830,842,767
Table 4: Impact Summary for the Brevard County FY 2010
Employment
Labor Income
Output
Impact Type
Direct Effect
3,447
187,401,934
479,760,814
Indirect Effect
1,144
44,556,441
133,433,179
Induced Effect
1,284
44,785,764
142,105,966
Total Effect
5,874
276,744,139
755,299,959
Table 5: Impact Summary for the Central Florida Region FY 2009
Employment
Labor Income
Output
Impact Type
Direct Effect
354
25,364,378
72,545,841
Indirect Effect
259
11,235,288
32,986,747
Induced Effect
265
10,701,888
33,165,276
Total Effect
878
47,301,554
138,697,865
Table 6: Impact Summary for the Central Florida Region FY 2010
Employment
Labor Income
Output
Impact Type
Direct Effect
321
21,025,323
62,485,459
Indirect Effect
222
9,713,951
28,291,447
Induced Effect
223
8,988,009
27,853,880
Total Effect
766
39,727,284
118,630,786
23