Sunday, April 6, 2008

Where are the Aerospace Jobs Going?

Not to Washington, not many to California, some to Alabama, some to Ohio, New Hampshire, Connecticut, some to China, Poland, Canada, France, United Kingdom, and several other places around the globe.



Northrop Grumman and EADS (Airbus) won the KC-45 tanker contract over Boeing. There were more U.S. jobs in the Boeing proposal, than in the NG+EADS proposal. NG had the best technical and cost proposal. Should we be concerned? Should we be surprised?

A long long time ago, we used to make all our military weapons and equipment in the US, but we also didn’t export any of it either. It was made in the US for the US. Today the A&D industry is a truly global industry. Instead of focusing on one contract, we need to expand our view and keep track of the trade with other countries. Especially with countries that are taking some of these jobs. Why? Because if these countries are buying other Aerospace products manufactured in the US, then they are also contributing to more Aerospace jobs in the US. As it turn outs, our A&D industry is doing pretty good in terms of trade when compared to some other industries.


In this chart from AIA (http://www.aia-aerospace.org/) we see that except for Canada we are doing pretty good in Aerospace trade with many of these countries. How come no one is complaining about how many Aerospace jobs are going to Canada?

I am concerned about several things that came to my attention from this news.
1. Are we losing the technical edge in Defense? in Engineering?
2. Can we direct some of that lobbying money to improving our designs and operations?
3. Can the West coast remain competitive in Manufacturing?

The news of the KC-45 Tanker reminded me of hearing about the Presidential Helicopter in 2005. I was also concerned at first about how many jobs were going outside the country, but then my attention turned to the technical side. Are we loosing the Engineering edge? Are the U.K. and France turning out better solutions? Better Engineering?

Between Boeing, NG, and GE they spent around $30M last year lobbying in D.C. What do you think they are spending right now? Perhaps we should spend less on lobbying and more on improving designs and improving operations, so we can have the best proposals.
Is it a coincidence that the US is not ranking globally very high in math and science? Are we spending enough in education? Are we spending our education budget on the right things?
We have increased our education spending over the last four years, but is it enough?

We just had a huge education budget cut in California. Over $4B in cuts means laying off 57,000 teachers (20% of the state’s teaching workforce), or eliminating four weeks of the school year, or increasing class sizes by 23-25 percent. How is this going to improve our math and science scores?

Washington and California have been losing Aerospace jobs, but Alabama, and North Carolina, are thriving and New Hampshire and Connecticut are holding on. What do their student-teacher ratios look like?
Students per Teacher (2005)
California 21.2
Washington 19.2
Alabama 15.7
North Carolina 14.8
Connecticut 13.6
New Hampshire 13.5

Maybe it is a coincidence, but the jobs seem to be going to states with better student-teacher ratios.

Alabama is becoming a big hub for Aerospace jobs and other states should take notice. They have an aggressive program to attract new business to the state, they have low real-estate cost, they are spending on education, and they have less union issues.

California, Washington,… is it time to re-evaluate our policies on education, and our priorities on manufacturing jobs? Can we live on software alone?

It will take some time, but it is going to take more investment in Engineering and Manufacturing in the US before we start seeing more announcements that the best propositions are coming from US ingenuity and from US manufacturers. It will take some time to rebuild the Aerospace expertise that has been lost because of the decline of military programs after the Cold War ended. Aerospace spending is on the rise now, so it looks promising in the future, if we can encourage our youth into Engineering and into the industry.

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