Updated 04/28/2009 06:16 AM
Lockheed Martin announces layoffs in Owego
OWEGO, N.Y. -- Lockheed Martin System Integration (LMSI) had to make some tough choices after a lengthy workforce analysis. Monday, the results were announced.
"As a result of that review, we found that a reduction in staffing of 225 people was necessary now," said Lockheed spokesperson Troy Scully during a phone interview.
The review was prompted by an announcement last month from Defense Secretary Robert Gates that LMSI's multi-billion-dollar VH-71 presidential helicopter program may be cut along with other contracts and bids. A memo from division president Marilyn Hewson also pointed to external pressures from the bad economy.
Affected employees will be told in mid-May, but Hewson said Lockheed took every step possible to save their jobs.
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"Our leadership worked very hard to identify work share with other Lockheed sites. We cut back on discretionary spending to reduce the need to cut staffing," elaborated Scully.
The announcement affects departments across the board and comes weeks before the DoD budget is set. A surprise, considering defense is one of the few thriving economic sectors.
"These layoffs are an anomaly based on program specifics. In general, defense spending looks very strong. The defense budget will stay the same from the Bush administration," said Richard Aboulafia, a defense sector analyst at the Teal Group.
The 225 layoffs represent a little over five percent of the 4,000 person operation in Owego. Lockheed will provide assistance as will Department of Labor Agencies.
"This includes helping them with resumes, applications, interview skills and research tools," said Shari McCall, Tioga Workforce supervisor.
Employees were tight-lipped as they left work Monday.
More than 800 work on the presidential helicopter program.
"The way things are looking a reduction in staffing is likely to occur later this year," said Scully.
It's unclear what the future holds for many at LMSI in Owego, but what is certain is that these are tough times and things may be getting tougher for many at Lockheed.
Congress may still save the multi-billion-dollar VH-71 program, but cutbacks or outright cancelation of other Lockheed Owego programs like the CSAR-X, a rescue and recovery vehicle, are expected.
Overall, Bethesda, Maryland-based Lockheed posted first-quarter earnings of $666 million.