From its early years when commerce involved the whale-oil trade, to today's highly sophisticated research in electronic submarine warfare, the seaport has continued to play a vital role in Newport's economy. The U. S. Navy, beginning with the founding of the Naval War College in 1884, influenced the development of the City and continues to do so as one of the major contributors to the local economy.
Newport's location, natural and cultural resources, and sense of history are responsible for the growth of tourism into a primary source of revenue. The third largest economic factor in Newport, the service sector, has benefited by both the defense and tourism industries.
There are estimated 21,200 individuals in defense-related jobs on Aquidneck Island. The major private employers are located in Middletown and Portsmouth; however, many of their employees make their homes in Newport and thereby contribute to the local economy. These workers represent a very highly skilled component of the local labor force.
The Navy is the island's largest single employer, employing approximately 9,000 military and civilian personnel. The Navy's presence in Newport is dominated by its work in education, training and research programs. Among the largest institutions involved with research programs is the Naval Underwater Warfare Center (NUWC), which has been designated by the Defense Department as the site for a "superlab" for doing undersea warfare research. The U. S. Navy Base or its related facilities have not been identified for any base closure or reduction, and, in fact, is currently expanding their facilities.
Within the City of Newport, 89.64% of all 2013 private employment was in the service sector. Although most of the service jobs are to be found in hotel/motel, social services, and health fields, other important services industries in Newport are also educational services and business services. Newport's inventory of office space attracts professional service firms, such as medical offices and legal services. Business services include, among others, building maintenance, personnel supply, and computer and data processing services. Computer and data processing, and engineering and management services are major sources of jobs at the regional level.
The retail industry represents the third largest source of private employment within Newport, with an annual average of 1,341 jobs in 2013. These include jobs in specialty retail, which includes galleries, gift shops, antique shops, and apparel and accessories. Retail and restaurant employment can swell by as many as 1,500 jobs during the peak summer season.
Recreational, or specialty retail, also plays an important role in Newport's visitor industry and provides shopping opportunities for visitors as well as serving Newport residents. The primary shopping areas in Newport are located on Thames Street, America's Cup Avenue, and Bellevue Avenue. The many antique shops and art galleries in Newport add to the City's historic and cultural character.
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