LOSING ALTITUDE: Employment in the Aerospace Sector

Abstract

Since the summer of 2001, America has seen the good, the bad, and the ugly aspects of the U.S. aerospace sector. In response to the horrific attacks of September 11, 2001, the United States military used its considerable might, especially air superiority, to bring down hostile regimes in Afghanistan and Iraq. The world saw, in real time, the advantages the United States’ aerospace industry provided as American soldiers brought about regime changes with minimal casualties. The operations were accompanied by strong domestic support for the U.S. armed services and for the major role of military aircraft.At the same time, employment dipped as a result of an incipient recession, and then fell precipitously with the collapse of civil aviation after September 11. The drop in employment in the U.S. aerospace sector has resulted in the lowest number of jobs in that sector in over forty years. Since reaching a peak of 1.3 million jobs in 1989, employment sank to 666,000 as of March 2003.1 The drop has cut employment nearly in half for production workers, engineers, scientists, and technicians. The International Association of Machinists and Aerospace Workers (IAM), the dominant representative of aerospace production workers in North America, has suffered through the largest percentage drop in membership since it first organized aviation workers in the late 1930s,2 and the International Federation of Professional and Technical Engineers, representing engineers and technical workers in aerospace, has been similarly hard hit.The decline of orders, the recession, and an aging workforce would be hard enough to overcome for any group of workers without the added pressure of outsourcing. Many U.S. multinationals are increasingly turning to outsourcing to find a cost-cutting edge. From aerospace design centers in Russia to a variety of tech centers in India, Eastern Europe, and China, knowledge jobs once thought unmovable now travel the world in nanoseconds looking for lower costs and talent advantages. “You will see an explosion of work going overseas,” says Forrester Research analyst John C. McCarthy. McCarthy predicts that at least 3.3 million white-collar jobs and $136 billion in wages will shift from the United States to countries where costs are lower by 2015.3