St. John’s International Airport is a Catalyst for Economic Growth

ST. JOHN’S, NL, April 28, 2011 – A recently completed Economic Impact Study (EIS) conducted by Strategic Concepts, Inc. and local economist Dr. Wade Locke on behalf of the St. John’s International Airport Authority clearly indicates that the St. John’s International Airport generates a substantial economic footprint on the Newfoundland and Labrador economy. On an annual basis, the Airport Authority and its 55 airport operating partners contribute $400 million in GDP/Income to the economy, generate approximately 7,700 person-years of employment, and produce over $80 million in tax revenues to all three levels of government. Much of these impacts are felt in Newfoundland and Labrador.

“The results of the Economic Impact Study clearly indicate that the Authority and its Airport partners play an important role in facilitating the growth of Newfoundland and Labrador’s robust economy. Not only does the airport allow businesses to have better access to global markets and enable the growth of the province as a tourism destination by offering an efficient transportation facility, it also directly and indirectly generates significant employment within the province and contributes substantially to the municipal and provincial governments in the form of taxes,” said Marie Manning, Director of Marketing and Community Relations with the St. John’s International Airport Authority.

Each year, almost 6,000 person years of employment are generated within the province of Newfoundland and Labrador as a result of the operations that take place at St. John’s International Airport. These operations also generate $21 million in tax revenue to the Newfoundland and Labrador government and $3 million to Municipal governments located on the Avalon peninsula.
Over 1,500 people are directly employed by the Authority and its 55 Airport operating partners, establishing St. John’s International Airport, collectively, as one of the province’s largest employers. In addition to the Authority, Provincial Aerospace, Cougar Helicopters and CATSA are the three largest employers and economic contributors at the Airport.

As a private, not-for-profit corporation, the corporate structure of the St. John’s International Airport Authority ensures that all excess revenues over expenses are retained and reinvested into the Airport’s capital assets. Since 1998, the Authority has invested $140 million on airport improvements including rebuilding the terminal building, upgrades to the airfield, and a number of passenger service improvements. These improvements alone created 3,155 person years of employment and generated combined government revenues from this activity of over $30 million.
The Authority recently announced a 10-year, $150 million capital program that involves a number of infrastructure projects designed to increase the accessibility of the Airport and expand the facilities to accommodate the forecasted demand of 1.9 million passengers by the year 2020. These projects, along with the 300 acres of land the Airport has available for commercial development in a city with limited supply of such land, will ensure that the Airport continues to contribute to the economic growth of the region.

“As impressive as these economic impacts are as outlined in this Economic Impact Study, they do not really capture the true economic contribution of the Airport to local and provincial economies. For instance, the benefits of local business being able to use the Airport to conduct business both across Canada and around the world could not be incorporated into this report, but are significant” commented Dr. Wade Locke, author of the study. “In fact, it is reasonable to argue that without the well developed and efficient airport in St. John’s, the transformation in economic activity now overtaking the province would not be possible.”

Data for this study was collected from a variety of sources, including SJIAA, Transport Canada, Statistics Canada, and approximately 55 companies operating at the Airport including airlines, retail operators, government agencies, and airline service providers. The information collected to determine the Airport’s economic impact was estimated using an Input-Output model, the de-facto standard model to estimate regional and national economic impacts in both the United States and Canada.
This is the second Economic Impact Study conducted by Strategic Concepts, Inc. and Dr. Wade Locke on behalf of the Airport Authority. The data used for this study was based on 2009 operations while the first study quantified the 2007 economic footprint generated from the Airport’s operations. Since the first study, total employment generated in Newfoundland & Labrador as result of the Airport’s operations has increased by more than 11% and GDP/income has increased by nearly 8%. Provincial government revenues have grown by more than 17%, while the contribution to the federal treasury has increased by almost 9%. Municipal government revenues have grown by approximately 8%.

The entire report is available on the Airport Authority’s website at www.stjohnsairport.com
St. John’s International Airport Authority is a private, not-for-profit corporation that exists to provide a safe and efficient transportation facility at Newfoundland and Labrador’s premier gateway. The Authority generates its own revenues, raises its own capital, pays Municipal taxes, and pays rent to the Federal Government on an annual basis to operate the airport on behalf of the community it serves. The Authority is committed to offering an outstanding airport experience for its passengers and enhancing the economic and social well-being for its community.

Highlights of the Economic Impact Study
GDP/Income:

• $400 million contribution to the economy throughout Canada
• $270 million contribution to the NL economy

Tax Revenue: Over $80 million to all levels of government $50 million to the Government of Canada $30 million to all Provincial Governments, with $21 million of this total to Government of NL $3 million to Municipal Governments on the Avalon Peninsula

Employment: 7,700 person years of employment created throughout Canada 5,960 person years of employment generated in NL, with 5,550 person years on the Avalon Peninsula Over 1,500 full-time employees are directly employed at the St. John’s International Airport by the Airport Authority and 55 of its airport operating partners Provincial Aerospace Ltd., Cougar Helicopters and CATSA are the largest employers at St. John’s International Airport

Capital Expenditure Program (1998-2010): $140 million invested in Airport infrastructure since 1998 1,680 person years of employment in NL and another 1,475 in the rest of Canada $75 million in incomes to the NL economy and another $110 million in the rest of Canada More than $30 million in tax revenue generated to all levels of government

Increases in Economic Impacts since 2007 Study Employment generated in NL – 11% GDP/Income – 8% Provincial Government tax revenues – 17% Municipal Government tax revenues – 8% Federal Government tax revenues – 9%