In 1985, the U.S. aerospace industry constituted 72 percent of the global aerospace market. However, by 1999, this had decreased to 52 percent. Although the United States has dominated the global aerospace industry in the past, the rest of the world is catching up as they realize that aerospace industry jobs are key to their own economies. Jobs in the aerospace industry are desirable because they are high paying and high technology. The civil aviation industry and the products that enable it form 9 percent of the gross domestic product. This creates jobs not only domestically, but throughout the world. For example, during the development of the Boeing 777, approximately 700,000 people worldwide were involved in some way, for example, through supply chain networks. The manufacture of commercial transports therefore has an enormous impact on the global economy.
Boeing is the largest exporter within the United States, and the U.S. aerospace industry is the single largest contributor to the nation’s positive surplus of trade. However, between 1998 and 2000 there was a drop in the surplus of trade by almost 50 percent as a result of foreign competition (Figure 9-2). The product that drives the single largest portion of the trade surplus is commercial transport planes. The largest driver for commercial transport sales is airline passenger traffic. During the past 30 years, passenger growth has been constant and the demand for commercial transports has grown. However, over the past few years, there has been a significant decline in passenger traffic in the United States. Several U.S. airlines have declared bankruptcy as a result. In Europe and the rest of the world, however, passenger growth has regained the place that it held prior to September 11, 2001, and global airlines are therefore not suffering to the same extent as U.S. airlines.
In the long term, there is a huge market for the aerospace industry. Currently, about