Greater Miami: International Air Service for Regional Development

Case Study – Hub size: large | Characteristic: international service

MIA Case Study

Miami International Airport (MIA) is the largest airport in Florida and a hub for American Airlines. Owned by the Miami-Dade County government and operated by the Miami-Dade Aviation Department, MIA offers more flights to Latin America and the Caribbean than any other U.S. airport. It is the country’s third-busiest airport for international passengers and is the top U.S. airport for international freight. The Miami region is included as a case study because of its international operations and the related regional economic activity.

The Greater Miami Region Including Nearby Airports

Economic Strengths

The Metro Miami region is the seventh-largest metropolitan area in the United States. The region has undergone significant growth since 2008. Employment growth in the region is especially noteworthy. Total employment increased by more than 1 million (29 percent). According to the U.S. Cluster Mapping Project, for the period 1998–2018, private non-agricultural employment growth in the region averaged 4.14 percent annually—the fastest growth in the country. The U.S. national average was 0.96 percent.

20082019Change #Change %
Population (000s)6,0816,89080913%
Total Employment (000s)3,5494,5851,03629%
Source: U.S. Bureau of Economic Analysis (BEA)

Like many large urban areas, the region’s economy is diversified. In 2019, the largest employment sectors were health care, retail and accommodations, and food services. However, from 2008 to 2019, several sectors grew at rates far above the regional average. These sectors tend to be reliant on air service.

All nonfarm
private employment
Real estate, rental, and leasingProfessional, scientific, and technicalFinance and insuranceManagement of companies

Foreign Direct Investment

The Miami-Dade area is home to approximately 1,300 multinational companies, of which more than 500 are headquartered outside of the United States. These companies cover more than 50 nations in North America, South America, the Caribbean, Asia, Europe, and the Middle East. U.S. Bureau of Economic Analysis (BEA) data show that for Florida as a whole, employment in multinational enterprises rose 40 percent from 2008 to 2018 (the latest available data), with the fastest growth in the professional, scientific, and technical (PST) and real estate sectors.

Air Service and Connectivity

From 2008 to 2019, total passenger traffic increased by more than 10 million (31 percent), rising from 32.5 million to 42.7 million. Much of that increase can be attributed to local rather than connecting traffic. Of MIA’s total traffic, the percentage represented by origin and destination (O&D) traffic rose from 59 percent to 67 percent. In addition, the balance of traffic shifted toward being more international. In 2010, the ratio of MIA’s domestic to international enplanements was 53:47. By 2019, it had become 51:49. In 2019, MIA ranked 3rd among U.S. airports for international passengers, behind New York’s John F Kennedy International Airport (JFK) and Los Angeles International Airport (LAX).

MIA Air Service Overview
MIA Air Service Overview

MIA has exceptional strengths with cargo and freight operations. During 2018, MIA handled 79 percent of all air imports and 77 percent of all air exports between the United States. and the Latin American/Caribbean region. In 2019, it ranked first in international freight and third in total cargo (freight and mail) among U.S. airports.

MIA Connectivity
MIA Connectivity

MIA is the nation’s international gateway to the Southern Hemisphere and offers more flights to Latin America and the Caribbean than anywhere else in the United States. MIA has experienced steady incremental growth in air connectivity in most years over the past decade. Between 2008 and 2019, connectivity at MIA (domestic and international) grew at an average rate of 2.6 percent per annum.

Changes in Air Service and Employment

MIA Employment and O&D Traffic
MIA Employment and O&D Traffic

Continued growth and improvement in connectivity also facilitate economic growth. MIA’s O&D traffic is highly correlated with total local employment. The correlation coefficient between the two is 0.98. However, correlation does not establish causation. That is, it is not evident whether rising total employment levels lead to more air traffic or whether more air traffic leads to more total employment.

The correlation between air service and employment remains exceptionally high when employment is restricted to those sectors that are more “aviation-reliant,” such as information technology, finance and insurance, real estate, PST, and management of companies. These are among the sectors showing the greatest growth from 2008 to 2019.

Stakeholder Perspectives on Contributions of Air Service to Economic Development

MIA has strong relationships with at least two of the major regional economic stakeholders in the region, the Greater Miami Chamber of Commerce and the Beacon Council, a public-private partnership that is the official economic development organization for Miami-Dade County. The Chamber has a seat on all of MIA’s working committees to ensure that the voice of the business community is present and heard. The Beacon Council focuses on seven target industries that are highly reliant on air service, including banking and finance, technology, life sciences, and trade and logistics.

MIA Case Study – Full Report