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Loooking at Orange County's Past Year Sheds Light on '86 : Defense

December 29, 1985|CARLA LAZZARESCHI

Although the defense industry will probably remember 1985 as the year an Orange County contractor suffered the cancellation of a major project, local military builders, overall, continued enjoying the benefits of President Reagan's military buildup. And the situation is expected to continue in 1986.

In fact, with the exception of Ford Aerospace & Communications Corp., which lost the multibillion-dollar Sgt. York contract and 1,300 project workers, the biggest problem for Orange County's defense contractors in 1985 was finding enough employees to handle their workloads.

"Basically it was a good year for us," said a spokesman for McDonnell Douglas Corp.'s 5,200-employee astronautics company in Huntington Beach, one of the four large aerospace contractors with operations in Orange County.

And no wonder. In April, the local company was one of two finalists selected to compete for the huge job of building the space station NASA hopes to shoot into orbit in the early 1990s. That competition with Pittsburgh-based Rockwell International is expected to result in a final contract award in early 1987.

Earlier this month, McDonnell Douglas also won a potentially lucrative Pentagon contract to design the build a missile system considered a key part of the country's so-called "Star Wars" defense. Details of the contract are expected to be released in early 1986.

Also celebrating its successes in 1985 is Hughes Aircraft Co.'s Ground Systems Group in Fullerton. In March, the huge, 14,000-employee unit received the go-ahead for a potential $1 billion contract to build a new submarine-launched torpedo for the U. S. Navy. Production of a full-scale torpedo is expected to begin next year.

But 1985 is surely a year that executives and employees at Ford Aerospace in Newport Beach would rather forget.

In August, after an investment of $1.8 billion, Defense Secretary Caspar W. Weinberger killed the Army's controversial Sgt. York, a tank-mounted gun. Within weeks, 1,300 employees were laid off and 300 workers were reassigned within Ford's massive defense and automobile manufacturing operation.

Nearly 350 workers continue to wrap up the myriad details associated with the program's demise. Throughout 1986, about 100 of the remaining Sgt. York workers will receive pink slips, a company spokesman said.

As a result of the massive Ford layoffs, certainly one of the largest in the local defense economy since the mid-1960s, total employment among aerospace contractors remained at a fairly stagnant 42,000 in 1985, according to Chapman College estimates.

Although it is difficult to forecast defense employment figures because they are so dependent on contract awards, Chapman business school Dean James Doti projected a modest increase in Orange County aerospace workers in 1986.

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