Black Hawk helicopter maker Sikorsky to eliminate 600 jobs
By Luther Turmelle | New Haven (Conn.) Register | Published: February 21, 2014
STRATFORD, Conn. — Sikorsky Aircraft announced Friday afternoon that it is eliminating 600 jobs in the next several weeks as a result of what it called “the challenging and unstable economic conditions that continue to affect our industry.”
Most of the jobs being eliminated are in Connecticut, said Paul Jackson, a company spokesman. The layoffs are roughly split between salaried and hourly employees, Jackson said.
“The salaried employee positions will be cut over the next several weeks, while many of the hourly positions will be eliminated over the remainder of the year as work winds down,” he said. Sikorsky has 3,900 hourly employees in Connecticut and 4,300 salaried workers in the state and 16,000 employees company-wide, according to Jackson.
The layoffs follow “significant cost-reduction actions that the company has already taken,” the company said in a statement.
“These decisions are always difficult to make but necessary to protect the company’s competitiveness and future,” the statement said. “As is our practice, we will provide transition assistance for those employees who are affected.”
Word of a major layoff coming at Sikorsky surfaced earlier this week, but representatives of Local 1150 of the International Brotherhood of Teamsters, which represents hourly workers at the company’s Stratford plant, could not be reached for comment.
The layoffs at Sikorsky weren’t the only negative employment news coming Friday out of Connecticut.
Documents obtained from the state Department of Labor show that as many 269 Verizon Wireless employees are at risk of losing their jobs as the company consolidates its operations in the state. The filings came a little more than a week after Verizon Wireless announced that Connecticut was part of a large company reorganization.
The data from the Labor Department about Verizon Wireless came from a Worker Adjustment and Retraining Notification Act filing that the telecommunications company made with the state Friday.
Verizon is reorganizing its Connecticut workforce, consolidating operations into its facility at 20 Alexander Drive in Wallingford and vacating leased facilities in Meriden and Rocky Hill.
Verizon Wireless spokesman Michael Murphy said the company is making every effort to find jobs for as many of the workers as possible who are affected by the consolidation. Murphy said efforts are being made to find the workers other jobs in Connecticut or elsewhere in the country.
Those who are not able to find other jobs within Verizon Wireless will be offered severance packages, he said.
The Sikorsky workers who are being laid off are also being offered severance packages, but Jackson said the company doesn’t comment on those details.
Friday’s layoff announcement comes in response to significant cuts to the rotocraft portion of the defense budget, said Richard Aboulafia, vice president of analysis for the Teal Group, an industry analyst in Virginia.
“The rotocraft portion of the defense budget is under very heavy pressure,” Aboulafia said. “It was the portion of the defense budget that grew the fastest as the U.S. entered the conflicts in Afghanistan and Iraq and it is now the portion that is receiving the most scrutiny in terms of cuts.”
Aboulafia said it is “highly likely” there will be more layoffs at Sikorsky.
Reaction from state and federal lawmakers to Sikorsky’s layoff announcement was swift.
“These layoffs are a deep disappointment,” U.S. Sen. Richard Blumenthal, D-Conn., said in a statement. “I will continue my focus on growing and protecting good, high-skilled manufacturing jobs in Connecticut and work with Sikorsky leadership as they develop long-term plans to keep these jobs in Connecticut.”
U.S. Rep. Rosa DeLauro, D-3, said she was “deeply troubled” by the news.
“These layoffs devastate these workers’ lives and those of their families, while hurting our community,” DeLauro said in a statement. “I am ready to help those affected in any way I can and I will continue to fight for key defense programs so that Sikorsky can manufacture more helicopters.”
DeLauro and Blumenthal, along with U.S. Sen. Chris Murphy, D-Conn., visited the plant in January to discuss the company’s future with executives.
State Sen. Kevin Kelly, R-Stratford, said southern Connecticut’s economy “will suffer greatly” because of the jobs being lost.
“Right now my top concern is to help the displaced workers,” Kelly said in a statement.
David Cadden, a professor of entrepreneurship and strategy in the Quinnipiac University School of Business, said the job cuts at Sikorsky could be a prelude to a sale of the company that has been rumored for weeks.
“What is most interesting about these current rounds of layoffs is that they coincide with rumors that UTC, the parent company, is considering spinning off or selling Sikorsky,” Cadden said in a statement. “UTC hasn’t commented on these rumors, but Sikorsky’s decline in profit margins and sales might cause them to think about a sale. Layoffs which might burnish the books might also make Sikorsky a more attractive candidate for acquisition.”
Jackson said the rumors of a possible sale or spin-off are unfounded.
Cadden said Sikorsky is not alone among its defense industry peers in trying to reduce its expenses.
“Curtailment of the military budget and uncertainty about future funding of military projects has made many firms in the defense industry cautious,” Cadden said. “Add to this that in recent years Sikorsky’s has seen a significant decline in the proportion of Pentagon spending on rotorcraft. Future helicopter projects — for the military — are years, if not decades, down the road.”