The military supports nearly 357,000 local jobs and represents $61.3 billion of San Diego County’s economy, according to the 2025 Military Economic Impact Report released Wednesday.
The annual report, published by the San Diego Military Advisory Council and the UC San Diego Rady School of Management found that defense spending accounts for 22.2% of the region’s gross regional product. This is a 3% decrease from 2024, partly due to federal budget cuts.
“San Diego’s defense community remains one of the most dynamic and stabilizing forces in our economy,” said Lisa Ordóñez, dean of the Rady School. “Our partnership with SDMAC reflects Rady’s ongoing commitment to generating insights that strengthen our region while supporting the service members, veterans and families who call this region home.”
The 2025 report lists $39.3 billion in direct defense spending, including $19.8 billion in defense contracts awarded to more than 2,000 companies. Compensation for active duty, reserve and civilian employees totaled $15.1 billion, while pension and veterans benefits rose to $4.3 billion.
“San Diego’s military presence remains a key driver of economic growth, innovation and collaboration,” said Michael Meyer, associate professor at the Rady School and faculty lead for the report since 2021. “Even with modest shifts and uncertainties in federal budgets, the data shows how resilient and deeply connected the defense sector is to our region’s workforce and technology ecosystem.”
In total, Defense supports more than one in five jobs locally: 143,000 active, reserve and civilian personnel, and indirectly supports 214,000 jobs through contracts, logistics and local business activities.
SDMAC has worked with the Rady School to produce the annual report for almost twenty years.
“This collaboration will help decision makers in San Diego, Sacramento and Washington, DC understand how critical the defense sector is – not only to national security, but also to local innovation, workforce development and quality of life,” said David Boone, president, CEO of SDMAC and a retired Navy rear admiral. “Our report finds that even amid changing federal spending patterns, the defense sector remains one of San Diego’s most stable and forward-looking growth engines.”
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