"Thelma and Louise" Moment In Manufacturing

AIA Warns 2013 Aerospace and Defense Outlook Threatened by Fiscal Cliff

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The reinvention of our American communities continues. That is having an impact on manufacturing. Take a look at one industry leader's concern for the future.

Warning that "we're getting closer to a 'Thelma and Louise' moment, when we careen off into the void," Aerospace Industries Association (AIA) President and CEO Marion C. Blakey told attendees at AIA's Year-end Luncheon Dec. 5, 2012 that "the time for real work, real negotiation and a real solution" to sequestration "is now."

Although the 2012 numbers for the aerospace and defense industry "remain encouraging despite the headwinds," Blakey also said "it is far too easy to conclude that the companies, workers and communities that comprise this industry can withstand anything; that they can adapt to any change, no matter how sudden or harmful."

2012 aerospace and defense industry sales are projected to increase by 3.8 percent from $210.8 billion in 2011 to $217.9 billion, Blakey reported.  The sales increase, along with a healthy expansion of aerospace and defense exports from $85.3 billion in 2011 to an estimated $95.5 billion in 2012, is largely due to strong civil aircraft sales, Blakey noted. The industry's positive trade balance rose from $55.8 billion in 2011 to an estimated $63.5 billion in 2012, the largest trade surplus of any manufacturing industry.  

On the jobs front, aerospace employment increased modestly this year from around 625,000 at the end of 2011 to more than 629,000 in the last quarter of 2012, despite layoffs in some facilities supporting military programs – reflecting the increased output of the industry, particularly in the civil aircraft sector. However, the specter of sequestration cuts could significantly impact the defense, civil space and civil aviation workforce, Blakey observed.

"The fact that the world's arsenal of democracy has been relegated to the status of political bargaining chip is difficult to fathom," Blakey continued. "But I am even more concerned about the long-term consequences for our country's leadership position in terms of global security, technology and economic strength."

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