As Aircraft Factories Shutter, Space Remains Bedrock Industry in Southern California
Aerospace employed some 160,000 workers in the region in 1990, but that is down to about 47,000 in 2010, according to the Los Angeles Times.
The space industry, meanwhile, seems to be more firmly entrenched in the area, executives said. The demand for space services, and the complex manufacturing facilities required to build satellites, aren’t going anywhere soon, they said.
Other states such as Arizona may have friendlier tax codes, or lower cost of living for employees, but one can’t easily pack up a satellite manufacturing facility and move it to friendlier states, said Craig Cooning, vice president and general manager of Boeing space and intelligence systems.
“What really built Southern California was the aerospace industry,” he said. The state would benefit from an understanding of why so many companies have left, he added. He did not want to elaborate, but taxes and regulations have been the oft-mentioned reasons for the exodus.
The late 1990s and early 2000s saw a wave of space industry consolidations. Both the Raytheon and Boeing facilities in El Segundo were once part of Hughes. Northrop Grumman merged with TRW in 2002, and took over its facility in Redondo Beach.
Hughes Communications Inc. carried on the famous industrialist’s name as an Internet satellite services provider for more than a decade after relinquishing its satellite manufacturing business to Boeing about the same time. In February, Englewood, Colo.-based EchoStar acquired Hughes for $1.34 billion. Soon, the only places where the legendary moniker may remain in Southern California is on the streets that bear his name.
Because of the different space-related nexuses in Southern California, the region has a unique and knowledgeable work force. Two of the three largest satellite manufacturers, Northrop Grumman and Boeing, remain in Southern California. Lockheed Martin, the third, is in Sunnyvale near San Francisco. NASA affiliated facilities such as the Jet Propulsion Laboratory in Pasadena, and the Dryden Flight Research Center are nearby. The Air Force’s Space and Missile Systems Center in El Segundo and Vandenberg Air Force Base where rocket are launched to the north, are also located here.
“There is certainly a large technical work force in Southern California, and that is certainly a big piece of what you need in terms of executing your space programs,” said Bill Hart, vice president of space systems at Raytheon.
“Yes the cost of living is high, but the cost of being in the space business itself is high. …. We have a large work force and it takes a long time in investment and training before people are able to execute the kind of programs we want to do with the reliability that we want,” he said.
Cooning added: “There are lot of smart people doing airplanes, but to do space you’ve got to be even smarter than that. A company’s real expertise in space is its human capital. And the human capital for space is principally in Southern California.”