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February 27, 2013

North Texas braces for defense cuts

Tension is mounting among North Texas aerospace workers as huge federal spending cuts due to take effect Friday under "sequestration" appear increasingly inevitable.

With Congressional leaders at an apparent impasse, automatic spending cuts threaten thousands of jobs and programs at Lockheed Martin, Bell Helicopter and other defense contractors that are part of the state's $36 billion aerospace industry.

"The only thing people can do now is hunker down and prepare to fire people, basically," said Richard Aboulafia, an aerospace analyst for the Teal Group in Washington D.C.

North Texas stands to lose big from reductions in programs and workers at some of the world's largest defense contractors, analysts say. The workforce at Lockheed Martin and Bell Helicopter tops 20,000 in Fort Worth alone, while thousands of others are employed by assorted providers of helicopters and aircraft components in Tarrant and neighboring counties.

In Tarrant County, contracts awarded to defense contractors totaled $11.1 billion in 2011, with more than $7 billion tied to Lockheed Martin's F-35 fighter program, according to the Center for Security Policy, a pro-defense group. Some big projects at Lockheed and Bell are already funded, and would escape immediate cuts.

While specific fallout from the budget battle is unknown, Lockheed Martin is already tightening its belt under pressure to contain costs on the over-budget F-35 program.

On Monday, Lockheed notified 68 employees that they will be laid off, spokesman Ken Ross said. The layoff notices went to material handlers, aircraft mechanics and assemblers, a union official confirmed Tuesday.

The layoffs are needed to adjust staffing based on program and business needs and are not related to sequestration, Ross said in response to questions from the Star-Telegram. All told, the company has had 328 layoffs in recent months. Ross has said each round of layoffs has been unrelated to sequestration.

Employees haven't been told if more layoffs are coming, but rumors are flying that more are in store, said Paul Black, president of the International Association of Machinists and Aerospace Workers, District Lodge 776.

"We're sitting here like everybody else to see what happens, but it's not going to be good,'' said Black, whose organization represents 3,600 employees at Lockheed's Fort Worth factory and thousands of service contract workers at Air Force bases in Texas.

"Good or bad, they need to share [information] so everybody knows,'' said Black, who surmises that the recent layoffs were sparked by problems associated with the Joint Strike Fighter.

Click here to read the full story that appeared in Wednesday's Star-Telegram.

-Yamil Berard

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