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Building the 21st Century National Aerospace Workforce
Aerospace Industries Association Special Session on “Revitalization of the Workforce”
March 27, 2003
Presentation by:Steve Sleigh, IAM
Joel Cutcher-Gershenfeld, MIT
“Right Skills, Right Place, Right Time”
2
Mission and Vision
• Overall Mission for the Aerospace Industry:– Enabling the global movement of people and goods; – Enabling the global acquisition and dissemination of information
and data;– Advancing national security interests; and– Providing a source of inspiration by pushing the boundaries of
exploration and innovation Source: Lean Enterprise Value: Insights from MIT’s Lean Aerospace Initiative (Palgrave/MacMillan, 2002)
• 21st Century Workforce Vision:– Attract and retain a 21st Century aerospace workforce with the skills,
capabilities and commitment to enable transformation and success in the aerospace industry
3
Strategic Challenges
• Knowledge and Capability– Demographic “cliff”– Gaps in “pipelines” – skilled apprenticeships and aerospace
engineering programs– Changing skill mix requirements and new technologies – Fundamental changes in the nature of work and operations
• Competitive Challenges– Global competition and organizational instability– Institutional barriers, monuments and gaps in the “social
infrastructure”– Divisive dynamics around job security, benefits and flexibility– Reduced attractiveness of careers in aerospace
4
Institutional Opportunities
• Aerospace Inter-Agency Task Force– Spanning the Department of Defense, NASA, FAA, Departments of Labor,
Education, Commerce and Homeland Security – to coordinate government aerospace workforce initiatives
• Aerospace Capability Network – Public/private partnerships spanning all key stakeholders—business, labor,
government, universities and community groups– Development of aerospace skill standards and certification programs – Dissemination of information on occupations, job availability, high performance
partnerships, and new work systems– Grants for demonstration projects at local and regional levels
• Industry Promotion and Development– Best practices in career development, employment relations, and life-long learning
across the industry– National campaign on aerospace opportunities – primary schools, secondary
schools, community colleges and universities
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Aerospace Workforce Knowledge, Skills and Abilities (KSAs): A Conceptual Map
Overall Stability, Capability, and Growth in the Aerospace Industry
Conception. . . Design/Development . . . Production . . . Sales/Sustainment
Multiple Product / Service Value Streams Across the Enterprise
Industry/Workforce Skills Assessment
Industry/Workforce Retention Initiatives
Industry/Workforce Knowledge
ManagementSchool-to-Work Initiatives
Skill Standards and Certification
Government Policies and Initiatives (within and across agencies) on Aerospace Workforce
National, Regional & Local Aerospace Workforce Initiatives (Industry / Labor / Government)
Workplace-Specific Initiatives
Knowledge-Driven Work Systems
(Lean, Six Sigma, etc.)
Industry/Workforce Needs Assessment
Aerospace Programs in the Schools
KSA Maintenance
KSA Enhancement
KSA Utilization
KSA Acquisition
Source: MIT’s Labor Aerospace Research Agenda
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Potential Topics for Dialogue
• Dialogue on Challenges:– Skills and capability– Competitive challenges
• Dialogue on Opportunities:– Priorities from industry and labor for proposed Inter-Agency
Task Force on the Aerospace Workforce– Elements of success for potential Aerospace Capability
Network– Opportunities for Aerospace Industry Promotion and
Development
For more information on aerospace workforce research at MIT, see the publications presented by MIT’s Labor Aerospace Research Agenda http://mit.edu/ctpid/lara and MIT’s Lean Aerospace Initiative http://web.mit.edu/lean. For more information on the IAM and High Performance Work Organizations, see http://www.goiam.org under “visit IAM Headquarters.”
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Concluding Comment
• All of the above options require substantial contributions from public and private sectors – not just contributions of funds, but of leadership time and attention
• We call for a deep commitment to fundamental cultural change in this industry – valuing human capital as the key to future success.
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Appendix
• Apprenticeship data
• Global footprint data
• National employment and sales data
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US DoL and Other Apprenticeship Programs: 2002 Survey
85% 85% 85% 85%
9% 10%8% 9%
3% 3% 3% 4%2% 0%
2% 1%0% 0% 1% 1%0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Graduates of US DOLApprenticeship ProgramsOver Past Three Years
Currently in US DOLApprenticeshp Programs
Graduates of OtherApprenticeship Programs
Over Past Three Years
Currently in OtherApprenticeship Programs
No Apprenticeship Program
None over past 3 years
Under 5 people
5 to 10 people
Over 10 people
The vast majority (85%) of aerospace facilities do not have apprenticeship programs and of those that do, approximately 2/3 have had no graduates over the past three years and have no one in the programs.
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Percent of US Respondents Reporting Suppliers in Each Location
US: 95%
Canada, Mexico: 23%
Japan, China, Korea: 22%
Europe: 35%
Russia, CIS: 4%
South America: 3%
Other: 3%
Key: Blue: Under 25%; Red: 25-50%; Green: Over 50%
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Percent of US Respondents Reporting Customers in Each Location
US: 98%
Canada, Mexico: 56%
Japan, China, Korea: 50%
Europe: 75%
Russia, CIS: 5%
South America: 29%
Other: 18%
Key: Blue: Under 25%; Red: 25-50%; Green: Over 50%
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Percent of US Respondents Reporting Joint Ventures in Each Location
US: 40%
Canada, Mexico: 7%
Japan, China, Korea: 11%
Europe: 18%
Russia, CIS: 1%
South America: 1%
Other: 3%
Key: Blue: Under 25%; Red: 25-50%; Green: Over 50%
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Percent of US Respondents Reporting Strategic Partners in Each Location
US: 50%
Canada, Mexico: 10%
Japan, China, Korea: 11%
Europe: 22%
Russia, CIS: 6%
South America: 1%
Other: 5%
Key: Blue: Under 25%; Red: 25-50%; Green: Over 50%
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Percent of US Respondents Reporting Current Competitors in Each Location
US: 92%
Canada, Mexico: 25%
Japan, China, Korea: 31%
Europe: 66%
Russia, CIS: 6%
South America: 5%
Other: 5%
Key: Blue: Under 25%; Red: 25-50%; Green: Over 50%
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Percent of US Respondents Projecting Future Competitors in Each Location
US: 73%
Canada, Mexico: 33%
Japan, China, Korea: 68%
Europe: 58%
Russia, CIS: 20%
South America: 13%
Other: 10%
Key: Blue: Under 25%; Red: 25-50%; Green: Over 50%
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Selected Written Comments on Surveys
• September 11 has had a severe impact on our industry which has influenced this survey. Airlines have received government support, however none of these funds have provided GSE manufacturers stability or longevity.
• Over the last two years we have been working very hard on upgrading Quality Systems (AS9000), implementing LEAN manufacturing, training, while at the same time diversifying the business and trying to penetrate new markets. Our products (cargo systems) are installed on older aircraft and those were affected heavily by the down turn in the economy as well as the events of sept. 11.
• Can't get domestic labor - skilled or otherwise. HELP!• Since September 11, 2001, there has been a significant downturn in the
volume of our business. I know for a fact that our facility and at least three of our most valued suppliers face an almost insurmountable challenge to stay afloat over the next 90 - 120 days if something doesn't change.
• We withdrew from the aerospace markets in 1997 and moved our manufacturing capabilities to the energy equipment markets.
• OEM's are using DOD funding to develop new technologies, practices & procedures and then turnaround and subcontract work overseas to the lowest bidder. They also utilize these advances on their commercial products which are primarily subcontracted to Asia & Mexico under the guise of mandatory offsets.
17
Chart 1: US and EU Aerospace Employment since 1980
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1980 1985 1990 1995 2000
Year
Em
ploy
ees
United States European Union
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Chart 2: Major Non-U.S. Aerospace Employer Countries since 1980
( > 30,000 employees with time series data available)
0
50,000
100,000
150,000
200,000
250,000
300,000
1980 1985 1990 1995 2000
Year
Em
ploy
ees
United Kingdom France Canada Germany Italy Japan
19
Chart 3: Sales and Employment for U.S. Aerospace Industry (SIC 372 and 376) since 1980
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
1980 1985 1990 1995 2000
Year
Sa
les
(mill
ion
US
$)
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
Em
plo
yee
s
Sales Employment
Implicit Price Deflator 1996=100, Seasonally AdjustedSource: U.S. Department of Commerce, Bureau of Economic Analysis
20
Chart 4: Sales and EmploymentSIC 372 - Aircraft and Part since 1980
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts (
$U
S M
illio
ns)
0
100
200
300
400
500
600
700
800
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
21
Chart 5: Sales and EmploymentSIC 376 - Guided Missiles, Space Vehicles, and
Parts since 1980
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts($
US
Mill
ion
s)
0
50
100
150
200
250
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
22
Chart 6: Sales and Employment for EU Aerospace Industry since 1980
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
1980 1985 1990 1995 2000
Year
Sa
les
(mill
ion
20
00
Eu
ro)
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Em
plo
yme
nt
Sales Employment
Due to consortia and other issues with EU consolidation, country-level sales data is not compiled by AECMA. Source: Ulrich Fischer, Attaché Policy Research (AECMA).
23
Chart 7: Sales and Employment forCanadian Aerospace Industry since 1984
0
2000
4000
6000
8000
10000
12000
14000
16000
1984 1988 1992 1996 2000
Year
Sa
les
(US
$M
)
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
100000
Em
plo
yee
s
Sales Employees
24
Chart 8: Sales and Employment for Brazilian Aerospace Industry since 1995
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
1995 1998 2001
Year
Sal
es (
US
$M)
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
Em
ploy
ees
Sales Employment
25
Chart 9: Sales and Employment for Japanese Aerospace Industry since 1988
0
200
400
600
800
1000
1200
1400
1988 1992 1996 2000
Year
Sal
es (b
illio
n ye
n)
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
Em
ploy
ees
Sales Employees
26
Chart 10: Sales and EmploymentSIC 49 - Electric, Gas, and Sanitary
Services
0
50,000
100,000
150,000
200,000
250,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts (
$U
S M
illio
ns)
0
200
400
600
800
1,000
1,200
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
27
Chart 11: Sales and EmploymentSIC 80 - Health Services
0
100,000
200,000
300,000
400,000
500,000
600,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts (
$U
S M
illio
ns)
0
2,000
4,000
6,000
8,000
10,000
12,000
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
28
Chart 12: Sales and EmploymentSIC 371 - Motor Vehicles and Equipment
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts($
US
Mill
ion
s)
0
200
400
600
800
1,000
1,200
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
29
Chart 13: Sales and EmploymentSIC 373 - Ship and Boat Building and
Repair
0
5,000
10,000
15,000
20,000
25,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts (
$U
S M
illio
ns)
0
50
100
150
200
250
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
30
Chart 14: Sales and EmploymentSIC 374 - Rail Equipment
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
1980 1985 1990 1995 2000
Year
Sh
ipm
en
ts($
US
Mill
ion
s)
0
10
20
30
40
50
60
70
80
Em
plo
yee
s (t
ho
usa
nd
s)
Value of Shipments Employees
