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CAREER PATHS : Tight Funding, Competition May Clip Wings for Aerospace

October 26, 1986|RALPH VARTABEDIAN | Times Staff Writer

When General Dynamics needed to hire several thousand new employees at its Valley Systems division last year, it set up a special program to fire up its employment recruiters.

The company, which builds surface-to-air missiles for the Army and Navy at a facility in Rancho Cucamonga, awarded its top employment recruiter a leased Corvette.

But this year, the firm, under somewhat less pressure to find the qualified engineers that have been in such short supply, awarded its top recruiter only a color television set.

The story at General Dynamics illustrates how the the Southern California aerospace job market has cooled in the past year. Although General Dynamics' work force is still growing, cutbacks at other firms have relieved the shortages of engineers that existed in the past few years.

While the defense and commercial aircraft industries remain vibrant and healthy, they have entered an era of less certain growth; only some companies will continue to enjoy the sort of robust expansion that every company had come to expect in recent years.

The dual effects of federal budget deficits and a more competitive environment in government contracting have put aerospace companies under sharp pressure to hold down employment, especially in those areas of overhead that do not fall under a direct government contract.

Although job opportunities are still plentiful, and even growing in many areas of the industry, most corporations have been finding it far easier to meet their recruiting needs than last year.

"A lot of companies were getting a lot of business in the past, but today only a few companies are getting a lot of business," said Sandford A. Lechtick, president and chief executive of National Recruiters Corp., an aerospace headhunting firm based in Woodland Hills. "I would say the opportunities are not as great as they were a year ago. Things have cooled down across the board."

Aerospace employment in California stood at 760,000 in August, up marginally from 755,500 a year earlier. In the Los Angeles region, aerospace jobs numbered 305,600, up from 296,600 a year before, according to the California Employment Development Department.

Jobs in the Los Angeles aircraft industry rose to 128,100 from 121,200 last year, thanks to the continued growth of commercial and military aircraft programs at Douglas Aircraft and Northrop. In the missiles and spacecraft sector, jobs rose to 19,300 from 18,500 last year, the EDD said.

The short-term outlook for the overall industry is for continued growth, but clearly at a more cautious level. In several years, the outlook could be far worse.

The Aerospace Industries Assn. of America, a trade group, recently projected a 2.6% growth rate in U.S. aerospace jobs during 1986, a much more moderate pace than the 5% annual rate recorded over the preceding three years.

Despite any general slackening of job conditions, the opportunities for engineers in selected specialties have not receded a bit, labor market specialists say.

Engineers in such areas as microelectronic circuit design, signal processing, composite structures, optical systems and artificial intelligence are all in short supply. Salaries for senior engineers or scientists in these specialties in non-management jobs can soar as high as $75,000 in some unusual cases, headhunters say.

The aerospace association noted tha the greatest rate of job growth in the last two years was a 7.7% annual pace for scientists and engineers.

One critical factor that should help offset any downturn in the employment market is the greater-than-normal rate of retirement that is looming in the defense industry. Retirement rates are expected to be high for a few years because many of the workers who got into the industry during its expansion around World War II are now coming due for retirement.

While that may help the job market, it will have little impact on the industry as a whole. The political outlook for the next several years appears to be for no better than zero growth in defense spending after adjustment for inflation.

Earlier this month, Congress approved a Pentagon spending bill for fiscal 1987 of $292 billion, a 3% reduction from the previous year, without considering inflation. That was a much larger cut than anybody had thought possible only six months ago and it will cause a disproportionately large ripple effect in the industry.

That's because the Pentagon will be hard pressed to start new weapons programs with no additional funds or even a shrinking budget. Thus, the average age of existing weapons programs will rise, and it's an inescapable fact that as defense programs mature, they require fewer workers.

"It takes fewer people to spend the same amount of money when a program matures," Rockwell International Senior Vice President Bastian (Buz) Hello said earlier this year.

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