In an era of a resurging employment outlook, one area experiencing at times dramatic job losses could harm national security if not properly addressed. Workforce experts said that continued downsizing of the nation’s armed forces will particularly affect Midwestern manufacturing states while potentially threatening military readiness.
Director of the University of Michigan Institute for Research on Labor, Employment and the Economy
Lawrence Molnar, director of the University of Michigan Institute for Research on Labor, Employment and the Economy
“As an economic thing we don’t want to see mass layoffs because of downsizing,” said Lawrence Molnar, director of the University of Michigan Institute for Research on Labor, Employment and the Economy and lead for the university’s Defense Manufacturing Assistance Program. “It’s also a matter of national defense. The supply chain can’t have gaps.”
“We had to identify at least 2,000 jobs lost in defense as a result of defense downsizing in three states,” Molnar said. “We identified almost 5,000.”
Molnar said that a top priority for the Defense Manufacturing Assistance Program is to provide support and resources for contractors to maintain those industries – both to help diversify regional business and for future defense readiness.
“We want them to continue defense work when available,” Molnar said. “But to also diversify revenue streams so when defense contracts are terminated they stay in production. If they’re needed again for national defense, we’ll still have these companies to respond.”
A separate federal grant from the Department of Defense Office of Economic Adjustment (Advance Michigan Defense Collaborative) – which provides nearly $6 million to promote research, industrial development, and talent development relevant to the defense industry in a 13-county Advance Michigan region of southeast Michigan – is being administered by the Workforce Intelligence Network for Southeast Michigan (WIN). Findings in the Advance Michigan region show hundreds of jobs lost among dozens of defense contractors. The state’s largest military installation – Selfridge Air National Guard Base in Harrison Township –is expected to face a potential loss of more than 400 jobs in 2015. TACOM, General Dynamics, Tower Defense and Aerospace, Chrysler, and General Motors have each posted triple-digit job losses.
“The Advance Michigan Defense Collaborative will provide immediate and sustained assistance to firms and workers by supporting resiliency of the defense industrial base and by expanding collaboration and capacity in the areas of autonomous transportation, lightweight materials, and cyber security,” said Tricia Walding, Advance Michigan Defense Collaborative project manager. “These efforts will allow the region to maintain the defense businesses and keep talented defense workers in the region even when defense spending has decreased. This work is very much in line with the DMAP program.
“It’s also a matter of national defense. The supply chain can’t have gaps.”
Molnar said that a mid-size supplier that had made wheel bearings for military tanks is well equipped to provide parts for manufacturers of bulldozers, earth movers or similar vehicles.
Lawrence Molnar
“With a company like that, the DMAP program allows us to study their capacity and abilities, analyze the market and get them contracts in other sectors to keep their employees employed,” Molnar said.
The ‘Michigan Model’ of diversification – a strategy adopted by educational partners in Ohio and Indiana – helps steer companies toward contracts from sectors other than defense. Ironically, the strategy reverses similar explorations that were made when the auto industry began its recession-driven decline.
“Defense was hot then,” Molnar said. “Now the auto industry is hot. It’s like flipping it.”