SOUTHERN CALIFORNIA JOB MARKET : REPORTS FORM THE FIELD : Cutbacks Put Aerospace Workers on the Defensive

In the heyday of the Vietnam War, Tony Tropin began working at Hughes Aircraft as an optical systems engineer. When the war ended and the aerospace industry suffered a collapse, Tropin managed to hold on to his Hughes job.

But after surviving the ups and downs of the defense industry for 20 years, Tropin’s luck finally expired last year. He was involuntarily retired from Hughes, one of 3,200 workers who were put out in 1989. An additional 6,100 Hughes workers left on their own.

“I was down at the credit union the other day and ran into four or five of the guys I used to work with,” Tropin, 58, recalled. “They left and haven’t found work either. We haven’t seen the worst yet.”

Tropin doesn’t need a sophisticated job marketing study to know what is becoming increasingly clear to the defense industry and the people who depend on it for jobs. It is only the beginning of a long and painful downturn, perhaps ending in a permanently smaller U.S. defense industry without the benefit of a Cold War to periodically stoke the demand for weapons.

The big question hanging over these people is whether the economy will be able to successfully assimilate them. DRI/McGraw Hill, the economic forecasting firm, projects that California will lose 110,000 aerospace jobs by 1994, but that those jobs will be replaced by growth in other industries.

But some experts confronting the situation closer at hand are more cautious. Some employers have a bias against defense industry workers, believing that their bureaucratic backgrounds do not fit the needs of private industry or that their technical knowledge has little relevance to non-military enterprises.

“I honestly don’t know where all these people are going to go,” said Otis Booth III, executive director at Russell Reynolds Associates, an executive recruitment firm. “As the situation worsens, these people are going to have a lot of trouble.”

Already, a backlog of unemployed aerospace workers is building up, employment experts and recruiters said. Although many of those idle workers have valuable skills, it is unclear whether they are marketable.

“It is a tough, tight market for aerospace and defense engineers,” said Sandy Lechtick, president of National Recruiters in Canoga Park. “The contracts are off, but also what hurts a lot of defense engineers is that they face discrimination by commercial companies. A lot of the technology is not relevant to the commercial world.”

Regardless of whether that assessment is fair, it is widely held, not only by recruiters but also by aerospace workers who for the first time are attempting to make a career transition. As a result, job hunters are being counseled to emphasize their basic academic and technical skills over their work experience in defense.

“I have the perception that the commercial sector believes that people from aerospace don’t know how to make a quick decision and are mired in bureaucracy,” said a recently furloughed executive from Ford Aerospace. “I think it is unfair, but there is no denying that that view is out there. There are a lot of worried people right now.”

The defense budget cutbacks so far do not even begin to take into account the effects of reduced world tensions and the thawing of the Cold War in Europe. The shakeout from those historic events will continue to be felt through the mid-1990s.

The defense budget has declined in inflation-adjusted dollars by 15.9% since its 1985 peak and could eventually be cut in half, a prospect that prompted one aerospace executive to predict, “Defense firms would be dropping like flies.”

In addition to Hughes, major layoffs or job cuts occurred last year at Lockheed, General Dynamics, Ford Aerospace and Northrop, among others. The cutbacks have taken a toll on virtually every occupation, ranging from hourly production workers to highly paid executives. Among the hardest hit are salaried specialists, including engineers, program managers and administrative staff personnel.

The overall aerospace job market in Southern California has not suffered greatly so far, in large measure because McDonnell Douglas has undergone a historic build-up in its commercial aircraft production in Long Beach, adding 25,000 jobs there and 4,000 in Torrence since 1984.

McDonnell and Boeing, the nation’s other producer of large commercial jetliners, have a combined backlog of more than $82 billion that will carry production work well into the mid-1990s.

At the same time, the budget for the National Aeronautics and Space Administration is increasingly rapidly, providing an additional cushion in Southern California aerospace. Companies such as Rockwell International, which is building a new space shuttle and parts of a space station, may escape any net job losses at all, company Chairman Donald Beall said in an interview.

But at only 10% of the Pentagon’s weapons budget, NASA contracting is too small to offset the overall losses in defense. And sometime during the decade, the big boom in commercial aircraft production is likely to peter out. A downturn in the commercial sector could force even more workers to find new careers.

Aerospace workers, especially those holding college degrees, can help make a career transition by emphasizing basic skills and by playing down their work in the defense world, experts say.

“Saying you are a systems engineer is the kiss of death on a resume,” Lechtick said, referring to the specialty of designing large-scale weapons systems. “You have to get back to the nitty gritty and emphasize basic technical skills.”

The same advice often applies to contract administration, production management or a range of planning functions, all of which in the aerospace world are characterized by massive departments of hundreds of people but in the commercial world are small, autonomous units.

So far, the preponderance of layoffs has affected salaried, rather than hourly, workers. But as major programs are cut, more hourly production workers may be affected.

For example, salaried positions made up 85% of the jobs cut under a special incentive plan at Hughes Aircraft last year, company spokesman Richard Dore said. Similarly, Northrop cut 3,000 jobs, mostly in administrative and other support functions.

To help its workers better cope, Hughes is offering educational stipends of $5,000 to laid-off workers, according to Fred Rodriguez, Hughes manager of corporate employment programs. In addition, the company held job fairs in which 80 major corporations interviewed 5,000 employees. Rodriguez said he did not know how many were hired, but he said: “Many of our employees have been hired locally.”

And yet many many aerospace workers will have to set their sights on jobs at smaller firms that may pay less and require more flexibility, according to Leigh Branham, a senior consultant at the out-placement firm of Lee Hecht & Harrison Inc.

Even if the outlook is dismal, aerospace has not lost all of its luster. Freshman enrollment in aerospace remains high at USC, said vice provost Richard Kaplan, adding that the incoming student body interested in the field was the largest in history.

AEROSPACE JOBS

early to Company mid-’80s current Hughes Aircraft 80,000 65,000 Rockwell International (California operations) 42,000 35,600 Northrop 48,700 42,000 Lockheed 99,300 80,200 TRW Space & Defense (California operations) 20,000 17,700 General Dynamics (Pomona division) 8,000 5,300 Douglas Aircraft 13,000 42,300