State's Defense Industry Expected to Continue to Grow
By Julia Bergman
August 6, 2018
Connecticut companies received $23 billion in defense contracts in 2017, the second highest level in 10 years, according to an annual report from the state's Office of Military Affairs.
The peak of the past decade came in 2014 when Connecticut defense contracts totaled $27.1 billion. That same year, Electric Boat was awarded a $17.6 billion contract to build 10 Virginia-class attack submarines.
"We're building the right things at the right time," said Bob Ross, executive director of the Office of Military Affairs. "The things were building in Connecticut are in high demand in the (federal) defense acquisition strategy: Sikorsky helicopters, Pratt & Whitney engines, and submarines" built by EB.
The report, which is based on data from the Pentagon, tracks how defense contracts are allotted over time, and also details key defense activities and issues for the nation and state. It suggests a good outlook for Connecticut's defense industry going forward given, in large part, Congress' recent passage of a $716 billion defense bill for fiscal year 2018 that significantly increases military spending. President Donald Trump is expected to sign the measure.
Connecticut ranked seventh in defense spending in the country in 2017, an increase from eighth the previous year. That includes money spent on purchases and military and civilian contractor pay. Ross said the data favors states with large military installations since it accounts for pay.
When excluding pay, Connecticut ranked fourth behind "defense behemoth states" California, Virginia and Texas, according to the report.
The "big three" defense contractors in Connecticut _ EB, Pratt & Whitney, and Sikorsky _ account for the vast majority of the federal defense spending received by the state. But the report indicates smaller subcontractors and suppliers are also being impacted.
Connecticut has 900 submarine suppliers, the most of any other state, according to data from EB, one of only two companies that build U.S. submarines, included in the report. These suppliers have received more than $1 billion in purchase orders over the past five years, according to the report.
While the outlook remains positive for the state's defense industry, the report points to the lingering challenge of developing a skilled and trained workforce.
EB hired 1,853 employees in Connecticut in 2017. Short term, customized training programs set up by the Eastern Connecticut Workforce Investment Board with partnership from the state's technical schools and community colleges to help address this issue, received some 4,000 responses by mid-2017, more than eight times the 450 openings available over a three-year period, according to the report.
Connecticut is ranked fourth at $5 billion in per capita defense spending projections for 2018 from the Pentagon. That includes pay and defense purchases.
But when excluding pay, and only accounting for defense purchases, Connecticut ranks second at $4.5 billion in per capita defense spending projections for 2018. Virginia is ranked first at $5 billion.
The Pentagon for six straight years has requested another round of base realignments and closings, a process known as BRAC. The state's Office of Military Affairs was set up in 2017 to defend the Naval Submarine Base against BRAC, after it was slated for closure in 2005.
Defense experts predict that it's likely there will be a BRAC round in 2021, the year after the next presidential election. A big factor will be the quality of public schools around military installations, Ross said, an issue Connecticut is well-suited to address given a long-standing committee of military officials and school administrators in southeastern Connecticut that meets monthly to work on schooling issues for military children. Ross has said the base is in a much better position today than it was when it faced closure in 2005.