Economic Commentary – The Economic Impact of a Rebounded and Revitalized Space Program on Florida's Space Coast

On August 2nd, a SpaceX capsule carrying two NASA astronauts successfully splashed down in the Gulf of Mexico, officially concluding a historic mission to return astronauts to the International Space Station (ISS). For the first time in nearly a decade, NASA astronauts destined for the ISS launched off from American soil, and for the first time in over four decades, an American space capsule splashed down in the ocean, reminiscent of the bygone Apollo era that first sent humans to the moon. 

Last month’s historic achievement does more than simply showcase human ingenuity and exploration; for residents on Florida’s Space Coast, the SpaceX mission signifies an economic rebound ten years in the making. For a local economy once devastated by the Space Shuttle Program’s end and the Great Recession, achievements in the private space industry have promoted a revitalized economy that continues to display an upward trajectory. 

From 1981 to 2011, the Space Shuttle Program brought in a mix of engineers, technicians, logisticians, specialists, and more to the Space Coast region and supported the creation of numerous other jobs indirectly related to the space program. The infusion of NASA spending into the local and state economy generated an overall economic impact of more than $4.1 Billion in 2008, translating into 40,802 jobs, $2.1 billion in household income, and $103 million in state and local taxes. Over 98 percent of the total economic output centered in Central Florida, where direct NASA spending totaled $1.82 billion in Brevard County and $83 million in other Central Florida counties. The average annual salary for a Kennedy Space Center (KSC) on-site worker was $77,235 in Fiscal Year 2008, nearly twice the average wage in Brevard County during that time.

When the Space Shuttle Atlantis ascended into space for the final time in July 2011, the ensuing job layoffs began to make their economic impact known. The final Shuttle missions marked the end for over 7,500 direct KSC employees, dropping the KSC’s workforce to around 8,500 workers, far smaller than its peak in the mid-2000s. According to analyses by local career centers, the direct space center layoffs also coincided with up to 14,000 indirect jobs lost in local hotels, restaurants, retail stores, and other small businesses that supported the KSC. These businesses indirectly related to the Space Program not only catered to KSC workers and their families but also to the many tourists who came to watch the Shuttle launches each year. No more shuttle viewings meant loss in customers and revenue, and by July 2011, Brevard County’s unemployment rate rose to 11.2 percent, above the state average of 10.1 percent.

From daycares and schools, to restaurants and retail establishments, organizations across the Space Coast faced a precarious situation as uncertainty over NASA’s layoffs rippled throughout the entire local economy. Yet as the future of American space travel seemed doubtful, a new alternative seemed to emerge, one that would ultimately encompass the ingenuity of private enterprise and restart a struggling local economy.