The M⁠i⁠l⁠i⁠⁠t⁠ary’s Overlooked Role ⁠i⁠n Flor⁠i⁠da’s Economy

By: The James Madison Institute / 2018



By: Connor James

Florida’s Military Installations/Defense Business Employment: 801,747 jobs[1]

Population of: Alaska: 739,795; District of Columbia: 693,972; North Dakota: 755,393; Vermont: 623,657; Wyoming: 579,315

Let’s not talk about tourism. Rather than discuss how the tourism industry is Florida’s economic savior, the focus should be on what narrowing Florida’s vision to tourism has allowed us to forget: the military. Florida’s military and defense industry accounts for more jobs than numerous states’ populations. With tourism often occupying the headlines for Florida’s economic future, the impact that Florida’s military economy has unfortunately been forgotten.

In Fiscal Year 2015, the National Conference of State Legislatures ranked the top U.S. states where the Department of Defense spending was the highest. Florida ranked fifth in total defense spending with $17.6 billion.[2] Virginia, California, Texas, and Maryland were the only states where the DoD spent more than in Florida. [3] Yet the spending by the DoD creates even more economic potential.

The military’s prominence has led to a proliferation of companies in the defense and homeland security industry which now has a total of 17,900 companies in Florida.[4] Enterprise Florida reported that since 2014, private-sector defense contracts done in Florida have increased 36.5 percent in comparison to the national average of 4.8 percent.[5] By bringing jobs and companies to the state of Florida, the military and defense industry helps to secure a strong and stable economy. With an economic impact of $84.9 billion[6], this industry plays a monumental role. Forget it, and over 9 percent[7] of the state’s total economy vanishes.

Comparing this industry to Florida’s much discussed and flourishing tourism industry, the military and defense industry’s impact on Florida’s prosperous economy stands out. According to an Oxford Economics study on the economic impact of out-of-state visitors’ spending in Florida released in 2016, tourism generated 9.5 percent[8] of Florida’s GDP, a figure that just barely edges out the 9.2 percent[9] of that generated by the military and defense industry. While Florida’s tourism industry makes up a slightly greater percentage of the economy, it is clear that the military and defense industry should not fall under the radar.

Let’s envision what this economy may look like down the road. In 2016, the Florida Chamber Foundation said that the military and defense industry’s total economic impact may be over $100 billion by 2030.[10] The projected number is a $25 billion increase from what the impact is now. However, the projection cited that federal budget cuts and military drawdown could impair this number. In the two years since the Florida Chamber made that forecast, the opposite has happened.

Military spending is increasing. Perhaps most crucial to Florida’s military economy, so is pay and procurement. In 2018, defense received its largest budget in history, raising defense spending to $700 billion.[11] The budget includes a 2.4 percent increase in pay for troops and $819 million increase in procurement spending from 2017. By 2019, defense spending is expected to rise to $716 billion, a further investment in America’s defense and military industry.[12] With the projections of the economic impact of Florida’s military and defense industry rising under the 2016 projection, it would be hard to imagine that this impact would not be increased further with the recent budget increases and military buildup.

This argument is not to be confused with belittling the tourism industry. With countless jobs and an enormous economic impact, tourism has played a major role in Florida’s growing economy. Instead, this article is highlighting an industry that gets little credit for playing a critical role in bringing businesses and jobs to the Sunshine State.

The future of Florida is bright, but it is pertinent to remember that the tourism industry is just one of many that is helping the state prosper.

Connor James is a student at the George Washington University majoring in Political Science and is interested in international relations, economics, and data analysis. Connor is an intern with the James Madison Institute.