Tuesday, January 26, 2016
Electric Boat to add 800-plus jobs in Connecticut this year
Electric Boat's Groton submarine construction yard
Stephen Singer and Alban Murtishi, Hartford Courant
25 January 2016
Electric Boat will add more than 800 new jobs in Connecticut this year thanks to robust military spending on the U.S. submarine program, the manufacturer said Monday. At its annual outlook meeting in Groton, Electric Boat executives said the company will hire 1,500 workers in Connecticut in 2016, with a net overall increase of about 840 because of attrition. The company will also hire 300 workers for its Rhode Island facilities.
The Groton-based company is in a "very enviable position," with a backlog representing more than $21 billion in contracted work, Electric Boat President Jeffrey Geiger said. Sixteen Virginia-class attack submarines are under contract and 10 of those submarines are under construction.
"All in all, it's a very positive picture for the long-term health of our business and employment prospects for the region," he said.
Spending for programs such as the Virginia class submarine, Virginia payload module and Ohio replacement program are expected to increase 11 percent, to about $8 billion, from $7.2 billion this year.
Electric Boat, a subsidiary of General Dynamics Corp., employs 14,100 people, mainly in Connecticut
Employment is projected to grow to 18,000 by 2030 to build a new class of ballistic-missile submarines.
"That's a huge number," said U.S. Rep. Joe Courtney, D-2nd District, whose district includes Electric Boat. "The numbers this year are very good for Connecticut."
"The growth in investment in submarine programs over the last several years — and more ahead — is driving growth not just at Electric Boat and the southeastern Connecticut region, but across the statewide network of suppliers and manufacturers that support this critical work. At a time when some question the future of our state's economy, today's news is a positive signal,'' Courtney said.
The increase, which included a 10-year contract in 2014 for five submarines, has "been building up over a number of years," he said.
"What you're seeing is a strong demand for the things that submarines do for national security," said Thomas Plante, director of strategic planning at Electric Boat. "The strong appeal of subs is their stealth, their ability to go where other platforms can't."
After a prolonged and slow recovery from the recession, Gov. Dannel P. Malloy said the state is now seeing some of the most significant job growth since the 1990s.
"This announcement by Electric Boat is no doubt great news,'' he said in a statement. "We've done much to support our manufacturers as well as align workforce training to meet the needs of our employers. We know the economy is adapting – and that state government needs to adapt with it. Nonetheless, this is clearly an announcement to celebrate and it will build on the already substantial job growth seen over the past few years."
Three major contracts are behind Electric Boat's demand for workers. The first is for 10 Virginia-class submarines that have engaged Electric Boat since 2008 and could be completed by 2013. The contract for the first five submarines was valued at $14 billion and a second group of five is valued at $18 billion.
Two other contracts are in the engineering and design phase and are important for the long-term prospects of Electric Boat, keeping the company busy into 2033.
The Virginia payload module will extend the hull capacity of submarines, while the Ohio replacement project is a larger effort, developing and building 12 submarines to replace the 14 Ohio-class subs Electric Boat built in the 1970s. Construction is expected to begin in 2021.
Nearly 500 suppliers in Connecticut work on the submarine programs at Electric Boat, representing a five-year investment of nearly $580 million for suppliers and manufacturers across Connecticut, Courtney said. Federal spending will have an impact throughout the economy in southeastern Connecticut.
"You're in a position where decisions to hire and make investments in Groton and Quonset are feasible," he said.
Despite the rising demand for work expected over the next decade, Electric Boat is not worried about production bottlenecks. Plante said the company's peak workforce was 27,000 in the early 1980s, nearly twice the payroll now.
Before the start of additional production in 2021, employment is expected to drop in 2019 unless Electric Boat can find additional work to keep employees busy, Plante said. The company is working to get contracts for submarine maintenance and modernization.
To find and train qualified workers, Electric Boat works with community colleges and vocational schools.
"We actively recruit in colleges and we have a robust trade recruitment effort," Plante said.