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Hughes to Keep Twice as Many Jobs in Fullerton : Aerospace: Plant reconfigurations mean the company can retain 1,400 positions. However, 1,000 layoffs are predicted by year's end.

March 12, 1995|ROSS KERBER | TIMES STAFF WRITER

FULLERTON — Hughes Aircraft Co., proceeding with the closure of most of its Fullerton operations, says it now expects to keep 1,400 jobs here--almost twice as many as it had initially projected.

Layoffs and transfers began almost immediately after September's announcement that the company would shut down most of the huge aerospace complex by the end of 1995. Red dots now mark the doors of vacant offices meant to stay that way.

By rearranging work areas and doing away with some private offices, though, Hughes will be able to keep more workers in the remaining space than the 700 it had initially projected, company spokesman Dan Reeder said. "Now that we've gone through the logistics work, we have a much more detailed idea of what the numbers are likely to be," he said.

However, that has not reduced the number of layoffs, which still is expected to total nearly 1,000 by year's end. Nor has it done much to boost the morale of workers, many of whom will not know for months yet if they will be kept on.

"Morale's still pretty low. I think they figured the (September) announcement would clear up a lot, but it hasn't," said Nancy Huebotter, a technical writer. "People are still in a transition phase, and everybody's thinking about whether they go or not."

Executives at Hughes, which is part of GM Hughes Electronics Corp., may have found transferring people to other sites more difficult than they had expected, said Esmael Adibi, an economist at Chapman University in Orange. "If you're a firm that relies heavily on skilled workers, it isn't as easy to move as people think. You have to have some assurance that enough of your people will move with you," he said.

That the company is taking a flexible approach to its restructuring is a good sign, Adibi and other analysts said, because the company is facing the realities of competing in the private sector, which it must do to survive cuts in the military spending that for years had been its main business.

"In the past they pretty much knew what was in the pipeline," Adibi said of pending defense contracts. "Now what's happening is that they know they have to go to commercial markets, which are affected more by the condition of the economy, the exchange rate, competition."

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John Harbison, a consultant at the Los Angeles office of management consulting firm Booz, Allen & Hamilton, lauded Hughes as "an example for a lot of other companies out there."

"This is a company whose culture, for many decades, was not to worry about costs. . . . To suddenly get these guys oriented on the customer will take a lot," he said, "but they're doing it."

The company's remaining employees have responded in various ways to the new frugality, with some scrambling to complete projects before their divisions are transferred and others working on their resumes.

"A lot of supervisors or other workers, you can see they're loafing," said John Rosas, a shipping department employee who has been at the company 14 years but expects to be laid off next month.

"The more you work, the faster the work gets done, and the quicker they're going to close the place," he said.

Rosas said he is motivated to be as productive as possible because he may need personal references soon. Also, he wants to keep his performance level high in case openings for which he might qualify are posted within Hughes.

Other employees said the atmosphere is improving customer service because, in the climate of uncertainty, workers are approaching their jobs one day at a time.

"People are still paying as much attention to the real work, as far as getting products out the door," said Linda Thurk, a logistics specialist. "But they're paying less attention to things that are handed down from upper management, all the paperwork."

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Hughes, which in the mid-1980s employed 15,000 workers, was down to about 6,100 in September, when the plant closing announcement was made, Reeder said. Of those, 238 workers have since been laid off, and 900 have been transferred, most of them to Long Beach or El Segundo. An additional 39 workers have resigned, he said.

The closing of the plant, which for nearly four decades was Fullerton's largest employer, stemmed from Hughes' formation a year ago of a new subsidiary called Hughes Aerospace & Electronics Co. The new entity, based in Washington, merged the company's aerospace, defense, missile and systems groups, which accounted for $7 billion of GM-Hughes' $13.5 billion in sales for 1993.

The increased number of people to stay at the Orange County plant will benefit the local economy, analysts said, though the restructuring is still a major blow.

"Any amount of jobs that stays in Fullerton is good news for the region in terms of the money that will stay here," said Anil Puri, chairman of the economics department at Cal State Fullerton.

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