By Nora Caley
From the January/February 2025 Issue
The aerospace and defense industry has experienced substantial growth and continues to be an economic powerhouse, both at the national and state levels. That’s according to the “2024 edition of Facts & Figures” from the Aerospace Industries Association (AIA), in collaboration with S&P Global Market Intelligence. The report, released in September 2024, noted that in 2023, the U.S. aerospace and defense industry generated over $955 billion in sales—a 7.1% increase from the previous year. The report also noted that each million dollars in sales supports four jobs across both end-use manufacturing and the supply chain. The aerospace and defense industry’s robust workforce totals more than 2.2 million employees, representing 1.4% of the nation’s total employment base. Nearly 60% of the jobs are directly linked to the supply chain, a figure that the AIA said highlights the supply chain’s foundational importance in driving industry employment and economic growth.
Also, according to the AIA report, the industry generated $425 billion in economic value, representing 1.6% of the 2023 nominal GDP in the U.S. The contribution to federal tax receipts from the aerospace and defense industry was $56.8 billion, making up 2% of the total tax revenues received by the federal government.
The “2025 Aerospace and Defense Industry Outlook” from Deloitte Insights pointed to several factors contributing to industry growth. Citing the International Air Transport Association, the report noted that as of August 2024, global air passenger traffic was up 11.9% year-to-date (YTD) and total capacity, measured in available seat kilometers, increased 10.2% YTD.
On the defense side, spending is increasing due to continued geopolitical tensions. The Deloitte report cited the Stockholm International Peace Research Institute, which noted that approximately 59 countries were at war in 2022, up by 27 countries compared to 2019. Defense expenditures surpassed US$2.4 trillion in 2023. These trends are expected to continue into 2025.
Alabama: Aerospace Industry Thriving
Alabama’s robust aerospace industry is soaring to new heights, propelled by groundbreaking projects and innovative investments that continue to add new dimensions to the sector across the state. From the production of next-generation rockets and missiles to the exploration of hypersonic technologies, there are many head-turning developments taking place in Alabama.
“Alabama’s aerospace industry is thriving, thanks to a unique mix of strategic investments, advanced manufacturing capabilities, and a skilled and dedicated workforce,” said Ellen McNair, Secretary of the Alabama Department of Commerce.
Aerospace is a major economic driver for Alabama, with significant contributions to job creation and investment. The industry supports over 45,000 jobs and generates over $6 billion in economic activity annually, according to the Aerospace Industries Association.
The presence of major aerospace, defense, and spaceflight companies, as well as support from state economic development initiatives, has attracted new industry investment to Alabama — over $4.3 billion in the past decade.
Alabama is at the forefront of integrating emerging technologies into the aerospace sector. This includes advancements in additive manufacturing, also known as 3D printing, a technology utilized by GE Aerospace to make aircraft engine parts at a trailblazing factory in Auburn.
Meanwhile, in Courtland, Lockheed Martin has set up a “digital factory” dedicated to hypersonic technologies. These innovations are poised to revolutionize the industry, making Alabama a key player in the next generation of aerospace technologies.
Mobile has become a central hub for Airbus in North America, and recent expansions of the company’s only U.S. aircraft factory underscore its importance. The addition of a new assembly line for A320 Family passenger jets, following a project to build a line for A220 aircraft, will boost production capacity and create 1,000 jobs.
Moreover, Alabama’s “Rocket City” continues to play a central role in the aerospace industry. Huntsville is making game-changing contributions to space exploration, decades after the Saturn V Moon rocket was developed there.
The Marshall Space Flight Center is a key player in NASA’s Artemis program, which aims to return humans to the Moon and pave the way for future missions to Mars. The development of the Space Launch System (SLS) at Marshall marks a monumental step towards these goals. With 106 Alabama firms contributing to the project, it also reaffirms the state as a leader in space innovation.
“Some people call it the ‘Rocket City,’” Governor Kay Ivey said. “I’ll raise that and say the brightest minds in aerospace and defense call it home.”
Significantly, the industry’s biggest names continue to invest in Alabama, including United Launch Alliance, which recently completed a $300 million-plus expansion project at its Decatur rocket factory, and Raytheon, which has launched a $115 million expansion of its Redstone Raytheon Missile Integration Facility, bringing 185 jobs to the Huntsville site.
“Alabama has a rich heritage in aerospace, which has allowed us to develop the expertise, the talent and the infrastructure that companies need to grow,” Secretary McNair said.
Visit www.madeinalabama.com for more information.
