NORTH CHARLESTON, SC (WCSC) - NORTH CHARLESTON, SC (WCSC) - The Boeing Company will add $6.1 billion to South Carolina's annual economy, according to a new economic analysis released Thursday by the Alliance for South Carolina's Future.
Over the first 30 years of operation, the length of time for the state's infrastructure bond issue, the study estimates that Boeing will generate almost $2.76 billion in state tax revenues, far outpacing the cost of incentives.
The analysis was prepared by Dr. Harry Miley, a Columbia-based economist who was chief economic adviser for Gov. Carroll Campbell.
Speaking on the economic conclusions presented in the study, Miley said "it was a little larger than I thought it might be. This is one of the largest [economic developments] that I remember in South Carolina."
Miley said Boeing's impact can be compared to that of BMW's, who have seen an increase from 2,000 to 5,000 jobs since the construction of its plant. "I think the same thing will happen with Boeing. We'll have jobs created in counties across the state," he said.
The manufacturing facility will have a $5.9 billion annual impact to the Charleston region, including more than 15,000 jobs that will be created as a result of the company's impact. That number includes the 3,800 announced jobs that Boeing will create, along with thousands of spinoff jobs in other sectors of the economy.
"The economic activity on an annual basis will generate about $91 million in state tax revenues. Over a 30-year period, that's over $2.7 billion in state tax revenues," said Miley. "That's a lot of state revenues."
"These impacts will begin to occur immediately once the facility is operational and will continue for the entire life of the facility," according to the study.
The construction phase of the project is expected to have a major short-term impact as well with almost 9,900 direct and spinoff jobs, and a $1.4 billion impact to the region.
Construction activity will generate an estimated $246 million in direct labor income. When multiplied throughout the region in indirect and induced impacts, the total increase in labor income is estimated to be more than $413 million.
"The Alliance for South Carolina's Future commissioned this study to put the Boeing project in historical perspective," said Ed McMullen, co-founder of the Alliance. "We also wanted to quantify the effect Boeing will have on our state. By every measure, the effect is profound."
Other findings in the study:
- The announced capital investment for Boeing ($1.025 billion) nearly equals all of the private capital investment made in South Carolina in 2003 ($1.128 billion).
- Boeing's capital investment per job ($268,816) more than doubles the statewide average in 2003 and is significantly above the average in South Carolina since then. The capital investment per job is a good indicator of whether a new facility will help support local governments.
- If Boeing's investment in South Carolina grows at a similar rate as that of BMW over the next 17 years, the company would employ 9,500 people and have a $10 billion capital investment.
- South Carolina must compete for jobs and new investment with incentive packages in part because the state's property taxes on industrial property are too high. One study ranks South Carolina highest in the nation, putting the state at a significant disadvantage.
The Alliance for South Carolina's Future is a nonprofit organization in Columbia dedicated to the state's economic growth.