Military-Industrial Complex Hit Hard By Government Shutdown
October 4, 2013 by Sam Rolley
According to reports, the government shutdown is slated to begin affecting the “industrial” side of the military-industrial complex as early as Monday, with a number of big-name defense contractors announcing that they will begin the process of furloughing thousands of workers at the beginning of the week.
Via The Hill:
Lockheed Martin said Friday that 3,000 employees would face furloughs on Monday due to the shutdown.
United Technologies Corp.’s (UTC) subsidiary Sikorsky plans to furlough 2,000 employees Monday if the shutdown is still in effect, and the defense firm said Pratt and Whitney and UTC Aerospace System could also issue 2,000 furloughs next week.
In all, UTC said more than 5,000 employees could be furloughed if the shutdown lasted into November.
Boeing said that it could issue furloughs “in the coming days,” and BAE Systems Inc. indicated 10 to 15 percent of its 35,000-person workforce could be impacted by the shutdown.
Many of the layoffs will correlate directly to furloughs already in motion within the government’s Defense Contract Management Agency. The DCMA has furloughed 85 percent of its personnel because of the government shutdown.
Two top defense industry executives sent a letter to Secretary of Defense Chuck Hagel earlier in the week, explaining that the government would also slow the disbursement of funds that remain available to contractors.
“The impact on credit lines for small businesses and cash flow for other than small businesses will be significant in short order,” the insiders warn.
The Defense Department has already deemed about 400,000 of its civilian employees to be non-essential.