With a tighter defense budget and the threat of sequestration, defense contractors say they may have to lay off thousands of workers and look for business overseas.
But for now, they have reason to stay put.
Washington-area defense contractors are reporting record operating margins. Washington Business Journal reports Lockheed Martin, Northrup Grumman and General Dynamics had stronger-than-expected earnings during the second quarter.
Analysts say the firms have reduced personnel and real estate, and they’ve made good business decisions to offset any declines in federal spending.
The same contractors, however, say they won’t be immune to budget cuts. Lockheed Martin says it could lay off up to 10,000 workers under sequestration.
This story is part of Federal News Radio’s daily DoD Report. For more defense news, click here.
Tom Temin is the host of The Federal Drive, which airs from 6-10 a.m. on 1500 AM in the Washington, D.C. region and online everywhere. Tom has 30 years experience in journalism, mostly in technology markets. Before coming to Federal News Radio, he was a long-serving editor-in-chief of Government Computer News and Washington Technology magazines.