Competition for Boeing work isn’t over yet

Do you hear that sound? That’s the bell ringing, summoning us to the next round in the battle to keep aerospace jobs here in Snohomish County.

Yes, we just finished celebrating the Boeing Co.’s decision to build the 737 MAX in Renton — a decision that secures the future of hundreds of jobs at Boeing’s Everett plant, where workers will continue to assemble wiring and build interiors for 737s as long as the MAX flies. That decision also means that scores of Snohomish County aerospace companies that supply goods and services for 737s will continue to have that work for another decade or more.

But within a year, Boeing will make critical decisions on the future of its next big airplane program — the 777X, which will be an upgrade of the best-selling aircraft built here in Snohomish County. Once again, there are no guarantees that Boeing will keep the work here in Puget Sound.

If we are to remain the home of the world’s largest aerospace cluster, we as a state, region and county are going to have to earn it. Here at Economic Alliance Snohomish County, we’ve given this a lot of thought, and have outlined a plan we feel gives us the best chance of ensuring that the aerospace industry will remain the basis for our mutual success and prosperity for generations to come.

We’re all familiar with the fact that Boeing is the largest aerospace company in the world, and that its largest manufacturing facility is right here in Snohomish County. As a result, our region is enriched with quality jobs, wealth and a strong base.

On the other hand, we often forget that Boeing is just one of 160 aerospace companies in the county. Combined, they provide direct employment for nearly 44,000 people, with their paychecks accounting for 28 percent of all wages earned by Snohomish County workers. In 2011, aerospace created more than 11,000 direct and indirect jobs. To put that into perspective, that is more jobs than the county’s next three largest industry sectors produced in the previous five years, combined.

Apart from Boeing, you will find companies performing maintenance repair and overhaul for the airlines’ in-service fleet, machine shops, parts finishing, raw materials manufacturing, wire harness fabrication, interior components manufacturing, carpeting and draperies, tooling, electrical and electronic manufacturing, product development design, and engineering and interior redesign for the aftermarket. Large and small — from the 1,400-strong Aviation Technical Services to Aero Mac Inc. with two employees — you can find it here.

Economists estimate that each Boeing aircraft program at the Everett plant has a direct annual economic impact of $700 million in wages alone. That results in some $600 million worth of spending at local businesses for things like cars, meals, clothes, homes and financial services. Think of what Main Street in every Snohomish County town would be like if we didn’t have this kind of economic engine to support our local stores, banks and restaurants.

The industry also impacts the nonprofit community. Last year, Boeing and the Boeing Employee Community Fund contributed more than $40 million to charity and nonprofit organizations in Washington alone. This does not take into account the dollars and hours of volunteer time given by individual Boeing employees, their unions and their families here in Snohomish County.

But as humans tend to do, when we’re familiar with something, we tend to take it for granted. We cannot let that happen with Snohomish County and its aerospace industry.

Last year, the Washington Aerospace Partnership hired a nationally known consulting group to study how our state and our county compete on a national scale. It was the most comprehensive study done on Washington’s aerospace industry since 2003.

Much of that study focused on Boeing’s plans for its new 737 MAX, and what Washington would have to do to ensure that it would be assembled here.

Thanks to the four-year contract extension that the Machinists Union and Boeing negotiated, we now know that the 737 MAX will be built right here in Puget Sound, from parts fabricated by companies across the Northwest.

The impact of this was tremendous for Snohomish County. The ratification bonus that Boeing paid to those union workers pumped $75 million into the Snohomish County economy, and as we’ve noted, it secured jobs for thousands of aerospace workers countywide.

While the 737 MAX question is settled, the Washington Aerospace Partnership study brought several unsettling questions to our attention about what happens next with the 777X.

Our community just celebrated the delivery of the 1,000th 777. Boeing engineers are looking at ways to upgrade this hot-selling jet, and executives want to start delivering the upgraded version — the 777X — by 2017.

Our community needs to realize that Boeing will make a decision on where it will build the 777X, and that there are no guarantees that Boeing will decide to build it here.

Aerospace is not an annuity for Snohomish County, meaning that even though we’ve invested in it in the past, it is not guaranteed and we shouldn’t assume it is here to stay.

These competitions are based on business decisions that could just as easily be made in favor of another region. As the Washington Aerospace Partnership study made crystal clear, other states covet all of the benefits that the aerospace industry jobs bring to us. Texas, the Carolinas and others have made significant investments of taxpayer dollars for this exact reason: to take work away from our state.

Our competitive advantage lies in the skills of our people: in the creativity of our aerospace engineers and the productivity of our aerospace mechanics. To maintain this edge, Economic Alliance Snohomish County has created a list of regional priorities with a strategy to accomplish them.

First and foremost must be increasing higher education opportunities to support the engineering, design and innovation demands of our region’s technical aerospace workforce. Establishing a Washington State University presence in Snohomish County and fostering the growth of its engineering program is vital. So is building upon our network of community and technical colleges.

In addition, we need to work with all our four-year universities to ensure they have the resources to grow their engineering education, research and development, and other technical programs.

We also cannot forget that a student’s preparation for an aerospace career begins before college. We must develop more and better K-12 programs teaching science, technology, engineering and math. We also must revive a prominent piece of our community’s culture by supporting teens as they explore aerospace careers.

Continued advancements in transportation and infrastructure are vital for the continued growth of aerospace, our nation’s largest export industry. This means investing in critical port infrastructure, our highways and mass transit. Our people and their products must be able to get from one place to another efficiently.

We must keep the cost of doing business here reasonable by streamlining permitting and regulations while maintaining our current set of aerospace industry incentives.

And finally, we must make these commitments now. Boeing is expected to make a decision on where to build the 777X sometime in 2013. We must be able to show them that we’re taking concrete steps to keep Snohomish County and Washington the best place in the world to build airplanes.

Making these investments brings benefits beyond aerospace. The same investments in education, workforce, transportation and infrastructure that make our aerospace companies more competitive are often directly transferable to other growing and emerging industries in our county. Every advanced manufacturing company in Snohomish County — from biotech to medical devices to clean technology — will reap benefits from this.

Companies want to locate in prosperous, competitive regions. If we build an attractive environment for high-tech manufacturing to thrive, companies in other industries will follow.

For everyone in Snohomish County, these kinds of investments will significantly improve our quality of place, creating vibrant communities where people are both excited to raise their children, and to retire. We can all strive to make our community the kind of place where our sons and daughters can grow up, go to college and then find jobs in the career of their dreams. We can make this a place where Main Street is lined with busy restaurants, successful retail stores and weekend farmers’ markets, with strong locally sponsored social programs and nonprofits.

No one is going to hand all this to us, but we can make this dream a reality by investing in one of our fundamental industries: aerospace.

Boeing estimates that airlines will need $3.2 trillion worth of commercial airplanes over the next 20 years. Whether they’re built here — or somewhere else — is largely up to us, and what we do in this next round of competition.

Next Sunday: With aerospace as our base, we look 20 years into Snohomish County’s economic future.

About the authors

Troy McClelland is president of Economic Alliance Snohomish County. Richard Cooper, CEO of The Everett Clinic, is the Economic Alliance’s board chair. Learn more about the Economic Alliance at www.economicalliancesc.org.