With the Space Shuttle retired and the US economy in its current state, many people are wondering how both the economy and the space industry can possibly move forward.
What they aren’t realizing, however, is that the two are, or at least can be, directly related.
The simple fact is that NASA creates jobs. How? Well, it happens with a one-two punch: A new NASA program or project creates jobs all around and spinoffs create even more.
The following is information taken from studies conducted to investigate the true relationship of NASA expenditures and economic growth.
A study by Midwest Research Institute (MRI) showed that the relationship between Research & Development (R&D) expenditures and technology-induced increases in GNP were directly mutually beneficial. Each dollar spent on R&D returns an average of slightly over seven dollars in GNP over an eighteen-year period following the expenditure. Assuming that NASA’s R&D expenditures produce the same economic payoff as the average R&D expenditure, MRI concluded that a total gain of $181 billion resulted from the $25 billion (1958) spent on civilian space R&D during the 1959-69 period, with $52 billion of that coming in through 1970 and the rest continuing to stimulate benefits through 1987.
A second econometric investigation of the relationship between NASA expenditures and the U.S. economy was conducted by Chase Econometric Associates. This study consisted of two phases. The first phase used a University of Maryland input-output model to analyze short-run economic impact of NASA R&D expenditures. Using an example of $1 billion being proportionately transferred to NASA from other non-defense programs, Chase estimated that the transfer would increase manufacturing output in 1975 by 0.1 percent, or $153 billion (measured in 1971 dollars), and would increase 1975 manufacturing employment by 20,000 workers.
The second phase of Chase’s study analyzed the long-term economic impact of NASA R&D expenditures. Using a production function which related NASA R&D expenditures to the productivity growth rate in the U.S. economy from 1960 to 1974, Chase concluded that society’s rate of return on NASA R&D expenditures was 43 percent.
Lastly, the Space Division of Rockwell International conducted a third study of the macroeconomic impact of NASA R&D programs involving the relationship between NASA’s Space Shuttle program and employment in the state of California. Using an econometric model developed at UCLA, Rockwell estimated that the Space Shuttle program generated an employment multiplier of 2.8; that is, direct Shuttle employment of 95,300 man-years in California produced an increase of 266,000 man-years in total employment.
It’s a lot to take in, but the basic story is this: If NASA wants to create a new spacecraft, people are needed from almost every sector of the science and technology industry to create each and every part of that spacecraft. And after all that, even more jobs can be created as these new products are applied to technology we use right here on Earth.
The result is called a “NASA Spinoff,” and here’s a little bit about them:
“A NASA spinoff is a technology, originally developed to meet NASA mission needs, that has been transferred to the public and now provides benefits for the Nation and world as a commercial product or service. NASA spinoffs enhance many aspects of daily life, including health and medicine, transportation, public safety, consumer goods, energy and environment, information technology, and industrial productivity. These spinoffs are transferred to the public through various NASA partnerships including licensing, funding agreements, assistance from NASA experts, the use of NASA facilities, and other collaborations between the Agency, private industry, other government agencies, and academia. As of 2012, NASA has documented nearly 1,800 spinoff technologies in the annual NASA Spinoff publication.”
There’s a good chance you don’t realize just how many products out there are NASA spinoffs. Memory foam? Spinoff. Infrared ear thermometers? Spinoff. Freeze-dried food? Spinoff. Here are some more NASA discoveries that have discreetly changed your life:
As our motto goes, all it takes is one penny to launch this nation. Let’s get a Penny4NASA.