Accession Number : ADA322395

Title :   California's Small Aerospace Suppliers Surviving Defense Downsizing.

Corporate Author : RAND CORP SANTA MONICA CA

PDF Url : ADA322395

Report Date : FEB 1996

Pagination or Media Count : 2

Abstract : Six years after Congress began reducing defense outlays, small California machine shops and aircraft parts suppliers remain highly dependent on the aerospace industry. Many firms in these two segments of the state's small defense aerospace supplier base have not branched into production of cutting-edge products for commercial customers. And other firms in these segments also may face shortages of software and product design engineers and of skilled machinists. So concludes a recent RAND analysis of the impact of defense downsizing on California companies. The study investigated how 25 small, California-based suppliers in the defense aerospace industry machine shops and aircraft parts makers; 11 electronics firms and materials firms-weathered the Pentagon's budget downturns of the early 1990s. But while noting these warning signs for several of the industry's subgroups, the RAND study found that much of California's small aerospace supplier base has survived the slide in Pentagon business, turning to commercial customers and other lines of production, increasing their productivity and, if necessary, reducing their work forces to compensate for lost defense aerospace revenues. Indeed, the state's small aerospace supplier infrastructure remains fundamentally intact, despite drops in defense revenues and overall employment levels. Few, if any, small aerospace suppliers intend to relocate from California, with its rich sources of customers, suppliers, and employees.

Descriptors :   *ECONOMIC IMPACT, *CONTRACTORS, *AEROSPACE INDUSTRY, *MILITARY DOWNSIZING, MILITARY SUPPLIES, EMPLOYMENT, SKILLS, INDUSTRIAL PRODUCTION, CALIFORNIA, PRODUCTIVITY, MILITARY PROCUREMENT, COMPENSATION, SHOPS(WORK AREAS).

Subject Categories : Economics and Cost Analysis
      Personnel Management and Labor Relations
      Logistics, Military Facilities and Supplies

Distribution Statement : APPROVED FOR PUBLIC RELEASE