The Economic Impact of the Cincinnati/Northern Kentucky International Airport on Greater Cincinnati
The importance of the Cincinnati/Northern Kentucky International Airport to the Greater Cincinnati1 economy continues to grow. One way of understanding this importance is by quantifying the Airport’s economic impact on business sales, household earnings, and employment in the region. This analysis contains the following findings.
- The total economic impact of the Airport in 2003 was nearly 56,000 jobs and more than $4.5 billion in economic activity. Of this $4.5 billion, $1.85 billion was in the form of earnings to Greater Cincinnati households and $2.66 billion was in the form of other business activity.
- The impact of the Airport was measured by focusing on three sources of economic activity related to the Airport -- the day-to-day operations of the Airport and its tenants; construction activity at the Airport; and the people the Airport brings into the Greater Cincinnati region for business, convention, and leisure purposes.
- The day-to-day operations of the Airport contribute the most to the overall economic impact of the Airport with $2.9 billion in economic activity and over 35,000 jobs in 2003. This economic impact is generated from two types of spending by the Airport and its tenants: $783 million in wage and salary payments made to 15,244 employees, and $888 million in purchases from local businesses that were made in 2003 to keep the Airport and its tenants in operation. Together, these expenditures generate an additional $1.24 billion in indirect and induced impact for the local economy.
- The economic impact from visitors to the region is the second largest component of the Airport’s economic impact. In 2003, more than one million air travelers who visited Greater Cincinnati generated a total impact of $1.06 billion in economic activity and over 15,500 regional jobs as a result of their local spending on food, lodging, entertainment, and other purchases.
- The economic impact from Airport construction accounted for $550 million in economic activity and nearly 5,000 jobs in 2003.
The continued growth of the Airport has given local economic development officials an essential tool for fostering the growth of employment opportunities in counties, cities, and townships throughout the region. The following findings demonstrate some of its contributions to regional economic growth.
- The Airport provides non-stop service to more of the nation’s population than any airport other than Atlanta. It offers “same day” service to two thirds of the metropolitan area population in the U.S.
- The Airport also has some of the best international service among non-coastal American cities, with convenient daily non-stop flights to five European cities that each have major connecting service throughout that continent.
- The location of a major airline hub at the Airport gives the region a higher level of service than it would otherwise have, and research has shown that the presence of such a hub increases an area’s high-tech job growth.
A very large proportion of the Airport’s economic impact is created because the Airport attracts “new money” to the region.
- Every day, the Airport brings more than $5 million of this new money into Greater Cincinnati.
- Of the $2.44 billion in Airport-related direct expenditures in 2003, 75 percent were generated from purchases made with dollars from non-local sources, dollars that are essential for the continued growth of the local economy.
The businesses and workers who are the beneficiaries of the Airport’s economic
impacts come from a variety of industries and counties.
- Businesses in the Transportation industry benefit the most from the Airport’s economic activity, receiving 37 percent ($1.64 billion) of the Airport’s total economic impact in 2003. Other industries that benefit significantly from the Airport include Finance, Insurance and Real Estate (11% of the total impact), Hotels and Amusement (7%), Business Services (7%). These top industries together account for more than 60 percent of the total economic impact.
- Workers in the Transportation industry also account for the highest employment impact, which is nearly 30 percent of the total jobs associated with Airport activity. Other top industries that benefit from the Airport’s employment impact are Eating and Drinking places (13%), Hotels and Amusement (12%) and Business Services (9%). These top industries together account for more than 60 percent of the total employment impact.
- Of the nearly 56,000 jobs that are part of the Airport’s economic impact, more than 23,600 belong to workers who live in Hamilton County. Boone and Kenton County residents each account for about 7,500, while the rest are widely distributed among the residents of other counties in the Cincinnati area.
- In Boone County, one in every four working households has a job as a result of the Airport’s impact. In Kenton County, the ratio is one in seven, and in Hamilton County, one in twelve.
1 Greater Cincinnati refers to 15-county Cincinnati Metropolitan Statistical Area (MSA) as defined by the Bureau of the Census, which includes 5 counties in Ohio, 7 in Kentucky, and 3 in Indiana.