Democracy's Arsenal: Creating a Twenty-First-Century Defense Industry

5. The Workforce: Industry, Government, and University

5 The Workforce: Industry, Government, and University For America to have the strongest possible national security posture and for war- fighters to have the best possible equipment and support for that equipment, they need a capable and experienced acquisition workforce—in both government and industry. The government workforce consists of the military acquisition workforce, career civilian acquisition workforce, and senior political appointees. The industry workforce includes people from large, defense-industry firms as well as the small and midsized firms that often serve both military and commercial customers. This workforce is generally specialized by area, such as manufacturing, software, or services. Figure 5.1 shows total defense-related employment from 1965 through 2005. The figure shows wide fluctuations in the industrial labor force, building up dramatically in periods of the Vietnam War (the late 1960s), the Reagan buildup at the end of the cold war (the late 1980s), and the conflicts in Iraq and Afghanistan (after September 11, 2001). The variations in defense-industry employment go from a low of around 2 million people to a high of around 4 million, and these large variations take place over relatively short periods of time. The figure also shows that since the 1970s, both military and civilian government workforces have not been built up during periods in which the defense budget escalated. Instead, the budget increases were absorbed by defense-industry workers, who often performed many of the jobs that were not inherently governmental but that historically were performed by the government. This cyclical employment was achieved through outsourcing, which (as the figure shows) provides flexibility. If this had been done by insourcing, government workers would have remained on payrolls throughout the low periods. Over the forty-year period shown in the figure and particularly since the information revolution of the 1990s, the nature of the work being done by this defenserelated workforce has changed dramatically. In 1990, for example, 37 percent of the workforce was employed in the (broadly defined) aerospace industry, but by 2000 this was down to 28 percent, and by 2006 it was down to 16 percent.1 There are two major causes for shifts in the workforce mix: (1) services have become a 236 Chapter 5 0 1 2 3 4 5 6 7 8 9 End strength (millions) 1 9 6 5 1 9 6 7 1 9 6 9 1 9 7 1 1 9 7 3 1 9 7 5 1 9 7 7 1 9 7 9 1 9 8 1 1 9 8 3 1 9 8 5 1 9 8 7 1 9 8 9 1 9 9 1 1 9 9 3 1 9 9 5 1 9 9 7 1 9 9 9 2 0 0 1 2 0 0 3 2 0 0 5 Total military Total Defense Department civilian Defense-related employment in industry Figure 5.1 Total defense-related employment. Source: Office of the Undersecretary of Defense (Comptroller), “National Defense Budget Estimates for FY 2006,” April 2005. majority of the functions being performed in the defense industry (by 2007, over 60 percent of Defense Department procurements were for services), and (2) bluecollar manufacturing jobs have decreased significantly as the high cost of weapons systems and their increasing complexity have resulted in far fewer of them, both in types and in quantity. Perhaps the single most important element in the weapons-acquisition process is the requirement for the government to have smart buyers, beginning with the government ’s career acquisition professionals. When the defense procurement budget plummeted at the end of the cold war, the acquisition workforce at the Department of Defense was correspondingly reduced significantly. In the mid-1990s, as procurement budgets flattened and started to expand, the Defense Department authorization act for fiscal year 1996 required the DoD to reduce its acquisition workforce by a further 25 percent by the end of fiscal year 2000. However, as acquisition budgets started growing (to compensate for the procurement holiday that the DoD had experienced in the post–cold war period) and skyrocketed after 9/11, the acquisition workforce continued to decline, causing a huge gap between the work that needed to be done and the people who were available to do it. This problem was The Workforce 237 further compounded by the fact that a significant share of the added work was in the difficult contracting area of...