Boeing implies the job benefits of its fighter jets, but peaceful spending creates more jobs

Published by Brent Patterson on

CBC News reports that Boeing executives made a public pitch on June 25th about its “history of delivering high-paying aerospace jobs” as it attempts to secure a $19 billion contract with the Canadian government for their F/A-18E/F Super Hornet fighter jet.

The article by Murray Brewster highlights: “In its presentation, the company estimates the value of its direct economic activity in Canada — both commercial and defence — at $2.3 billion, resulting in 11,000 jobs across the country. The independent report estimates that when indirect spending is taken into account, the U.S. multinational contributes $5.3 billion and 20,700 jobs to Canada’s economy.”

“Boeing’s decision to make its case publicly is significant in part because federal finances are reeling under the weight of an anticipated $252 billion deficit and staggering levels of unemployment brought on by the COVID-19 pandemic.”

Back in early April, Elliot Hughes, a senior advisor at the Ottawa-based Summa Strategies, observed: “The soaring deficits [associated with COVID-19 relief and stimulus spending] will place tremendous pressure on government to reduce its spending in non-COVID-19 areas in favour of healthcare and related priorities.”

But while the Boeing pitch is that it contributes 20,700 jobs to the Canadian economy, Lockheed Martin has already highlighted: “According to the Statistics Canada model, approximately 50,000 jobs will be created in Canada through the selection of the F-35.”

Still, for the $19 billion purchase cost for the fighter jets, plus $300 million a year in maintenance costs, is this the best use of public funds after 3 million jobs were lost over March and April and 2.5 million more people had their hours reduced?

The Canadian Labour Congress has previously pointed out that a $17.6 billion investment in public transit could create 223,000 per job years.

In the U.S. context, Phyllis Bennis has written: “$1 billion in military spending creates approximately 11,200 jobs — but the same amount of money would create 26,700 jobs if invested in education, about two-and-a-half times as many. Or 16,800 jobs in clean energy, or 17,200 in health care.”

Similarly, research by the Costs of War Project based at Brown University’s Watson Institute for International and Public Affairs found that while $1 million spent on “defence” creates 6.9 direct and indirect jobs, the same amount invested in solar power creates 9.5 jobs, in health care 14.3 jobs, and in elementary and secondary education 19.2 jobs.

The numbers would suggest that public spending on weapons is a poor allocation of finite public dollars when it comes to job creation.

The deadline for final submissions for the fighter jet contract is July 31, with a decision expected in 2022, and the first delivery of fighter jets to be in 2025.


Chart: Costs of War Project.

Categories: News Updates


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