Study: State’s aviation growth expected to slow

? The commercial and general aviation industry should continue to grow and create high-wage jobs in Kansas for several years – but it may not generate as much growth as in the past, a new study predicts.

The forecast is generally good news for the state, said Janet Harrah, director of Wichita State University’s Center for Economic Development and Business Research, which prepared the forecast.

But the aviation industry won’t be the growth engine it has been in the past, she said, because manufacturers won’t need as many employees, in part because of productivity increases and outsourcing.

Still, “we absolutely want to keep the aviation industry here,” Harrah said. “It’s the base of our economy, and we don’t want to lose it.”

The study was commissioned by Kansas Inc., an organization created by the Legislature to conduct economic development research and analysis. The forecast is one of several studies Kansas Inc. will use when it devises a strategic economic development plan for the state.

Using historic data from the industry’s business cycle, the forecast predicts five years of employment growth in Kansas, followed by three years of decline before growth resumes.

The pending 900 layoffs at Boeing Co.’s military site in Wichita this year “may be more of a threat to both the plant and its supplier base than is reflected in the forecast,” the report said.

Despite dramatic increases in defense spending – from between about $50 billion and $60 billion before 2002 to $109 billion this year – the layoffs are a “serious aberration,” analysts said in the report.

That invites “speculation about the Boeing Company’s plans for future use of the Wichita plant,” the study said.

The aerospace industry in Kansas faces several challenges, said Stan Ahlerich, Kansas Inc. president. He said it should be a concern that Wichita manufacturers have lost some market share to competitors outside the state.

Cessna still makes about a third of all U.S. airplane shipments, but that is down from 46 percent in 2000, as other companies, such as Cirrus Design and Diamond Aircraft, increased deliveries. Raytheon Aircraft’s shipments of King Airs were down in number of units delivered and in share of the market, the study said.

The era of huge aircraft factories appears to be waning, the report said, as Boeing and Raytheon have announced they want to be final assemblers less directly involved in parts manufacturing.