Published: Thursday, April 9, 2009
Gov. Gregoire to address state aerospace shortcomings
Study finds Washington isn't as competitive as other states in aerospace
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Gov. Chris Gregoire and lawmakers declared an aerospace “emergency” on Thursday, creating a task force to keep the Boeing Co. in the state.
Gregoire responded quickly to a study that says Washington is becoming less attractive than other states to aerospace companies like Boeing.
The study, funded by the state and conducted by Deloitte, shows Washington’s “disadvantages outweigh the advantages” when it comes to attracting and retaining aerospace companies. State lawmakers have been concerned that Boeing may not select Washington when or if it builds a second assembly line for its 787 Dreamliner jet.
Local aerospace analyst Scott Hamilton, with Leeham Co., first obtained a copy of the study. The Economic Development Council of Snohomish County commissioned Deloitte to conduct the study. Hamilton will speak at an EDC function on Boeing's potential second 787 line later this month.
Many of the state’s “disadvantages” should come as no surprise to Washington politicians. The drawbacks include high workers’ compensation and unemployment insurance rates. Washington also lags behind other states in aerospace training.
Deloitte looked at Kansas, North Carolina, South Carolina and Texas.
The study also found that workers for Boeing's rival, Airbus, have been increasingly more productive than Boeing workers, requiring fewer employees to produce more commercial aircraft.
Among some of the the consulting firm's findings:
To win the initial 787 Dreamliner assembly line in 2004, state lawmakers gave the OK on $3.2 billion in tax incentives to Boeing and aerospace suppliers.
Boeing has not officially announced that it will need a second production line for its mostly composite 787 jet. The company has won nearly 900 orders for the fuel-efficient Dreamliner but has fallen nearly two years behind schedule on delivery.
Gregoire responded quickly to a study that says Washington is becoming less attractive than other states to aerospace companies like Boeing.
The study, funded by the state and conducted by Deloitte, shows Washington’s “disadvantages outweigh the advantages” when it comes to attracting and retaining aerospace companies. State lawmakers have been concerned that Boeing may not select Washington when or if it builds a second assembly line for its 787 Dreamliner jet.
Local aerospace analyst Scott Hamilton, with Leeham Co., first obtained a copy of the study. The Economic Development Council of Snohomish County commissioned Deloitte to conduct the study. Hamilton will speak at an EDC function on Boeing's potential second 787 line later this month.
Many of the state’s “disadvantages” should come as no surprise to Washington politicians. The drawbacks include high workers’ compensation and unemployment insurance rates. Washington also lags behind other states in aerospace training.
Deloitte looked at Kansas, North Carolina, South Carolina and Texas.
The study also found that workers for Boeing's rival, Airbus, have been increasingly more productive than Boeing workers, requiring fewer employees to produce more commercial aircraft.
Among some of the the consulting firm's findings:
- "Washington has not been a player in recent site selection decisions by aerospace companies."
- "Competitive disadvantages include wage rates, labor relations, training, cost of living, and real estate/utility costs."
- "The frequency and high costs of work stoppages, fairly or unfairly, reflect negatively on Washington."
- Washington needs to address gaps through legislation, including "unemployment insurance tax, training, research and development funding and building a government entity dedicated to the aerospace industry."
To win the initial 787 Dreamliner assembly line in 2004, state lawmakers gave the OK on $3.2 billion in tax incentives to Boeing and aerospace suppliers.
Boeing has not officially announced that it will need a second production line for its mostly composite 787 jet. The company has won nearly 900 orders for the fuel-efficient Dreamliner but has fallen nearly two years behind schedule on delivery.
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