A few days after defense contracting titan Northrop Grumman terminated 60 positions at its Sperry Marine manufacturing and engineering headquarters in Albemarle, nine local job postings remained on the Northrop website. Of those positions, only one is classified “electronics division”—meaning that many of the local engineers and manufacturers fired by the company would likely need to move if they planned to remain Northrop Grumman employees.
While growth in the local defense intelligence community has generated buzz about job creation, reductions at Northrop Grumman show both sides of the equation. Companies like Northrop Grumman live and die by defense contracts, says Michael Harvey, president of the Thomas Jefferson Partnership for Economic Development (TJPED). But employers like the Defense Intelligence Agency may not need intelligence analysts and manufacturers in equal measure.
“There’s a difference between what Sperry does and what a lot of the growth part of the defense industry, intelligence, does,” says Harvey. “Sperry’s actually making something.”
The company’s other eight job openings in Charlottesville fall within Northrop Grumman’s Information Systems division. In 2009, Northrop Grumman opened a new Information Systems facility in UVA’s North Fork Research Park.
Timothy Hulbert, president of the Charlottesville Regional Chamber of Commerce, agrees that it’s a “difficult environment” for those in manufacturing.
“There are some production jobs growing in the region, but it’ll be a difficult time for many of those 60,” says Hulbert.
The layoffs mark the largest local indicator of Northrop Grumman’s struggle as the Department of Defense cuts back on contract spending. Last year, Northrop Grumman announced plans to close a Louisiana-based shipyard, and also eliminated nearly 400 positions at its shipbuilding center in Newport News, Virginia. In March, Northrop Grumman separated its shipbuilding division from the company, and rebranded it Huntington Ingalls Industries, Inc. Stockholders received one share of the new company for every six shares of the old.
The terminations also mark the contraction of a company whose local roots run deeper than those of its owner. Sperry Marine began operations in Charlottesville in 1956 as Sperry Piedmont Company. After it was purchased by Litton Industries in 1997, Northrop Grumman bought Litton and opened more than a dozen Sperry Marine offices in different countries.
During a 50th anniversary celebration, John DeMaso, then VP of Northrop Grumman’s Naval and Marine Systems division, estimated that more than 25 percent of Sperry employees had been with the company for more than two decades.
Tom Delaney, communications director for Northrop Grumman’s electronics division, said the company will offer the 60 former employees full severance and job placement assistance, within other parts of the company as well as with other companies that may hire similar positions.
“We’re a big believer in trying to do everything we can for our employees in this regard,” said Delaney.
Harvey, meanwhile says that the TJPED is still spreading the word about the need for local manufacturing and engineering jobs. But, he says, “we’ve got a lot of work to do there.”