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TCWV in the News

WVU leads partnership studying impact of federal defense cuts on state economy

November 29, 2016

West Virginia University, along with lead partner TechConnect West Virginia, has received a grant of almost $1 million to study the impact on the state of reduced defense spending nationally with a goal of helping mitigate the effect on the economy and create and strengthen relationships for possible growth.

The grant comes from the Department of Defense’s Office of Economic Adjustment and will enable WVU and TechConnectWV to work with the West Virginia Development Office and myriad other related agencies and organizations to establish a clear understanding of the impact of defense cuts and how the state economy can absorb them and move forward.

“The role of defense spending in West Virginia is not as obvious as in other places, but it is significant,” said David Satterfield, director of asset development for WVU who will serve as principal investigator. “We just don’t know as much as we need to about the defense supply chain and the ripples through our economy caused by reductions.

“This will help us figure that out,” he said.

There is a very diverse mix of defense contractors and activity in West Virginia, Satterfield noted. As in many economic sectors, the defense industry supply chain has seen reductions in recent years. While we see some examples of reductions in West Virginia, this grant will help to increase the diversification of the supply chain to help WV defense manufacturers.

“WVU is in a position to look at the entire state and understand how dollars flow from the Department of Defense through sub-contractors and all the way to local businesses and communities,” West Virginia Commerce Secretary J. Keith Burdette said. “Once we understand the extent of the impact, we can begin the important work of helping these businesses transition.”

Defense spending, or the defense supply chain, accounted for an estimated $527 million in fiscal 2015, the last year for which full numbers are available, according to the grant application.

“This aligns well with TechConnectWV’s mission to support small businesses and manufacturers in the state with advances in innovation to help make them more competitive and more resilient,” said TechConnectWV Executive Director Anne Barth. “It’s a proactive step to identify and make the most of opportunities in the state’s defense industry, and we’re proud to be a part of the initiative/”

Once the study is complete in about a year, Satterfield said, state businesses should be able to adjust and diversify much better as defense spending dries up.

“West Virginia University is uniquely situated to help lead this study,” President Gordon Gee said. “It is directly in line with our responsibilities as the state’s flagship University as we seek to foster broad-based prosperity.

“We are grateful to the Defense Department for the grant, and to Secretary Burdette for allowing us to lead this effort, and bring together others around the state, for this important study.”



CONTACT: David Satterfield, West Virginia University