$2.5 trillion space hype: Where's the rocket?

The world is being sold a $2.5 trillion space story. Look closer, and the rockets barely show up. The number comes from a McKinsey-sourced chart. That is not published by NASA or a space agency, but by Global X, an exchange-traded fund provider. The ETF firm's own footnote admits the point: Investors aligned with these sectors stand to benefit.

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Break down the McKinsey chart, and the picture changes fast.

• Supply chain and transportation: over $500 billion.
• Food and beverage logistics: over $400 billion.
• Retail and consumer goods: over $200 billion.
• The category actually labelled "space" – rockets, satellites, and launch – sits at the bottom of the list, under a hundred billion.

McKinsey's original report, done with the World Economic Forum, is more careful. It splits the space economy into "backbone", which is the hardware, the satellites and the launches, and "reach", which are the industries that merely use satellite data. In 2023, "backbone" and "reach" were roughly even, at about $300 billion. By 2035, "Reach" is projected to pull far ahead, crossing a trillion dollars. While the "backbone" grows to $755 billion. That distinction matters.

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Uber, using GPS, is "reach". A grocer tracking a delivery truck is "reach". An insurer pricing flood risk from satellite imagery is "reach". None of that is new industry. It's just an old industry being relabelled with the space tag. Semiconductors, AI, and clean energy have all seen their addressable markets inflated the same way, by counting every downstream user as part of the sector. It's a well-worn method for building bigger and more fundable numbers. None of this means space is not growing.

Launch costs have fallen tenfold in two decades. Satellite deployment is up. But the trillion-dollar headline is doing more marketing work than reporting work. When the fastest-growing slice of an industry never leaves the ground, the number isn't measuring the industry; it's just measuring who wants you invested in it.