Defense cuts hit nearly 1,000 workers in region

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Local,Business,DC,Maryland,Virginia,Liz Farmer
The federal government's sweeping defense program cuts are prompting rounds of layoffs in the Washington region, as the peg that held the local economy up during the recession is suddenly halting progress.

Nearly 1,000 workers at three of the area's major defense contractors have lost their jobs so far this year, with 112 General Dynamics Corp. employees in Woodbridge among the region's latest victims of the five-year, $150 billion budget cut announced by Congress in January.

"The defense industry, like all industries that are subject to government funding, [is] more at risk now and over the next year," said John Challenger, CEO of human resources consulting firm Challenger Gray & Christmas. "I believe the government is going into recession ... and Washington may not bounce up and progress like other parts of the country."

Defense contractors giving pink slips
CompanyWhere Jobs cutWhenLayoffBuyout
General DynamicsWoodbridge 112JulyYes
Northrop GrummanBaltimore area 200TBDYes
Lockheed MartinAlexandria 45AprilYes
Northrop GrummanBaltimore area 600AprilYes

Nationwide, layoffs in aerospace and defense this year have surged to nearly 12,000 compared with last year's loss of 3,938 jobs.

In the Washington region, 45 employees were laid off last month at Lockheed Martin Corp.'s Alexandria office in addition to the cuts at General Dynamics Land Systems announced early this month.

But Northrop Grumman Corp. has been the region's biggest defense job-cutter this year. In March it announced it needed to cut 500 jobs in the Baltimore area through buyouts or layoffs. But even after 600 employees volunteered to take buyouts, the company said last week it planned to lay off 200 more employees, mostly in the Baltimore region. An additional 450 employees across Virginia received pink slips this year, although none of them worked in the immediate Washington area.

Randy Belote, a spokesman for Northrop Grumman, said those figures were relative, noting that the contractor, which has roughly 40,000 employees in the Washington area and is moving its headquarters to Fairfax this summer, has anywhere from 500 to 1,000 open positions in the Washington region at any given time and employees who are laid off do apply for those jobs.

"They're encouraged to go through the process and move from one business area to another, and it happens frequently," he said.

The federal budget cuts announced in January included closing the U.S. Joint Forces Command in Norfolk and canceling the Marine Corps' Expeditionary Fighting Vehicle program. A spokeswoman for General Dynamics, which produced the armored vehicles for the Marines, said Monday the company's layoffs were a direct result of losing the EFV program.

The Washington area has nearly 125,000 workers in the defense, aerospace and engineering industries, according to the Greater Washington Initiative, a regional marketing, research and economic development organization affiliated with the Greater Washington Board of Trade.

However, experts noted that the region's private sector is picking up steam and easing the impact of the government downsizing. For example, between March 2010 and March 2011, Virginia added 10,600 health and education jobs and 16,600 hospitality and leisure jobs, but just 3,500 government jobs.

Stephen Fuller, director of George Mason University's Center for Regional Analysis, said the Washington area could reduce its reliance on government. While the federal downsizing won't be as drastic as it was during the 1980s, he said, D.C.'s economic growth is expected to slow and the region will lose its place as the top job producer in the country.

Fuller expects the region to remain above the national average for economic growth, but only by less than 1 percent while previous years have seen regional growth three or four percentage points ahead of the nation.

"We're going to have to look around and understand what our assets are and start growing them because we're not going to be able to rely on the federal government as we have been," he said.

lfarmer@washingtonexaminer.com

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Liz Farmer

Examiner Staff Writer
The Washington Examiner