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Updated 10:00 AM August 14, 2006
 

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U-M-Dearborn faculty, students study airport's economic impact

Detroit Metropolitan Wayne County Airport (DTW) generates more than 71,000 jobs and more than $7.6 billion in total economic impact across Michigan, according to a study by U-M-Dearborn and the Wayne County Airport Authority (WCAA).
Management Profs. Lee Redding and Kim Schatzel top and right) met with Detroit Free Press reporter Jewel Gopwani and Detroit News reporter Amy Lee at the July 27 press conference announcing the results of a study of the economic impact of Metropolitan Airport. (Photo by Terry Gallagher, U-M-Dearborn)

"The impact of activity at Detroit Metropolitan Airport on our economy is truly enormous," says Lester Robinson, WCAA CEO. "Capital improvements at the airport pay for themselves many times over in terms of generating income for citizens and prosperity for our communities. It is very clear that people throughout Michigan have a stake in the airport's continued success."

The Economic Impact Study was compiled by faculty members and students from iLABS, the U-M-Dearborn School of Management Center for Innovation Research. The study, led by Lee Redding, assistant professor of business economics, estimated the economic impact of the airport on Wayne County and on the state as a whole, measured in terms of revenues, incomes and jobs.

As part of the analysis, Kim Schatzel, associate professor of marketing, and a group of 12 students conducted a survey of more than 1,500 passengers traveling through the airport during December 2005 and January 2006. In 2005, more than 36 million passengers arrived or departed, including 2.9 million business and pleasure travelers who stayed in Michigan and whose spending benefited the state's economy.

In Wayne County the annual economic impact of the airport includes more than $5 billion in spending for goods and services, more than $1 billion in income to county residents, and more than 30,000 jobs, according to the analysis. Across the state, the annual economic impact of the airport includes more than $7.6 billion in demand for goods and services, and more than $2 billion in income for Michigan residents. The report was based on direct and indirect impact of economic activity generated by the airport, and other effects.

"Using different multipliers captures the fact that income generated by Detroit Metropolitan Airport not only impacts Wayne County but provides substantial economic benefits to businesses and residents in other parts of Michigan," Redding says. He calculated that in 2005 total demand for passenger service at the airport generated more than $2 billion, and shipments from DTW accounted for more than 100,000 tons of freight, with an impact of $55 million.

Schatzel and her students found that two-thirds of the passengers were passing through DTW to other destinations, and another 23 percent were leaving or returning to homes in the region. The 11 percent of passengers surveyed who said they were visiting the area for business or pleasure translated to 2 million visitors to southeastern Michigan per year.

Those who stayed in the area reportedly spent an average of $548 on hotels, meals, rental cars and other expenses, annually spending more than $700 million, with an additional indirect impact of $400 million, to support more than 11,000 jobs in the county.

In addition to analyzing the annual economic activity generated by the airport, the U-M-Dearborn study looked at the effects of the Authority's current renovation projects, including a five-year capital improvement program launched during the 2005 fiscal year.

"These projects not only have immediate economic impact by creating demand for construction services, but the ongoing benefits that result from a superior airport," Redding says.

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