SAN DIEGO – The high-tech U.S. Navy command known as NAVWAR contributes billions of dollars to the gross regional product.
Some $3.3 billion circulates through San Diego County because NAVWAR is here, said Jeremy Gabe, Ph.D., associate professor of real estate at the Knauss School of Business at the University of San Diego and co-author of a new economic impact study.
President and CEO
San Diego Military Advisory Council
“If this was a company in San Diego, it would be in the top 20,” said Mark Balmert, president and CEO of the nonprofit San Diego Military Advisory Council, which collaborated with the university on the study released last week (Jan. 30).
Associate Professor of Real Estate
University of San Diego
NAVWAR, which specializes in electronics, connectivity and cybersecurity, is “every bit as technical” as San Diego companies such as Qualcomm and Viasat, Balmert said.
However, it keeps a lower profile.
Old Town Campus
NAVWAR has been in the news for its effort to replace its aging facilities on Pacific Highway north of downtown, a short distance from Old Town State Historic Park.
The Navy is currently in exclusive negotiations with Manchester Financial Group and Edgemoor Infrastructure and Real Estate to build a new facility for NAVWAR and redevelop the rest of the 70.3-acre Old Town Campus to include civilian housing and more. A timeline for redevelopment has not yet been announced.
NAVWAR stands for Naval Information Warfare Systems Command.
The $3.3 billion economic impact figure is an estimate, taking into account direct spending ($2.25 billion) indirect spending ($290 million) and induced spending ($760 million). The Orange County consulting firm DPFG produced the estimate using IMPLAN software and data from the Navy.
The total figure could be as low as $3.18 billion and as high as $3.36 billion, said Gabe. Part of the research process was interviewing companies about how much money stays in San Diego County.
The top NAVWAR contractors listed in the report are Booz Allen Hamilton (NYSE: BAH), receiving $267.7 million; Viasat (NASDAQ: VSAT), receiving $233.8 million; and SAIC (NYSE: SAIC), receiving $116.9 million.
NAVWAR also awards work set aside for small businesses. KOAM Engineering Systems was the top recipient of small business contracts, receiving $37.8 million.
NAVWAR has satellite facilities on Point Loma and on the East Coast. The command’s $9.7 billion annual budget in fiscal 2022 grew $1.1 billion in fiscal 2023.
$910M in Spending Power
The organization directly employs 5,300 people. When wages and benefits are considered, the NAVWAR workforce brings slightly less than one billion dollars — $910 million — to the San Diego economy. The command offers good paying jobs. A high percentage of its workforce, some 37%, holds master’s or doctoral degrees.
NAVWAR’s indirect spending is business-to-business spending, such as property maintenance and consulting services.
Induced spending is local consumption by NAVWAR employees, who shop locally, visit local doctors and eat at San Diego County restaurants. “They’re not going to drive to Riverside County” to meet such needs, Gabe said.
NAVWAR, previously known as SPAWAR, relocated from the Virginia suburbs of Washington, D.C. to San Diego in the last years of the 20th century following the 1995 Base Realignment and Closure (BRAC) round. That relocation decision from a quarter century ago has resulted in 18,800 jobs in San Diego today, Gabe said.
Much of the money spent by NAVWAR stays in the San Diego County area, Gabe said.
During a presentation introducing survey results, speakers noted that while NAVWAR resembles a giant tech company, it offers a resilience that corporations don’t provide. The command does not go through booms and busts. The command was an asset to San Diego during the COVID-19 pandemic.
Executive Director
NAVWAR
‘Invisible Lighting Bolts’
NAVWAR’s specialty may not be as evident as sister Navy commands such as NAVSEA (ships) and NAVAIR (aircraft), said John Pope, who as executive director is NAVWAR’s top civilian leader. Pope likened NAVWAR’s work with information warfare, networks, sensors and connectivity to “all those invisible lightning bolts” connecting Navy assets.
“The work that we do is not getting smaller,” Pope said. “There’s more work to be done.”
One part of NAVWAR deals with IT to run the Navy organization.
A separate, high-priority effort is called Project Overmatch. Billed as one of the Navy’s top development priorities, it is the Navy’s contribution to the U.S.
Department of Defense’s Combined Joint All Domain Command and Control (CJADC2) effort. The report describes Overmatch is a multi-command effort to synchronize lethal and non-lethal effects and connect manned and unmanned systems in a robust naval operational architecture that integrates command and control across the joint force.
