aerospace/sfvbj/wd/31 inches/mike1st/jc2nd By WADE DANIELS Staff Reporter A recent hiring spree by Lockheed Martin Skunk Works is sending the Antelope Valley economy surging ahead with renewed growth. Since the beginning of 1996, three new contracts and the relocation of a plant to the area have brought boosted employment from 3,500 workers at the Lockheed facility to about 5,000. And those ranks are projected to grow to 6,000 by mid-1998, according to Ron Lindeke, a Lockheed spokesman. “In a word, the impact of these hirings on the economy here is ‘huge’,” said Vern Lawson, executive director of the Antelope Valley Economic Development Corp. “The key is that the types of jobs from these projects, mostly managerial and engineers, bring new wealth and have a two- to three-times multiplier effect on the community.” The hiring spree started last July when the Skunk Works was named prime contractor for NASA on a $960 million contract to build a demonstrator X-33, a vehicle intended as a successor of the Space Shuttle. Lindeke said some parts of the ship are being built elsewhere in the country but the “vast majority” of the money is flowing into the Antelope Valley facility. In recent weeks, Skunk Works finished hiring for the 600 new jobs for the project. Last November, Lockheed announced plans to employ 900 new workers following its selection as one of two companies to build prototypes for the joint strike fighter, an aircraft being designed for use by the Navy, Air Force and Marines. Lindeke said the contract is worth about $500 million to Skunk Works. About 400 of those 900 workers have been hired so far, Lindeke said. In October, Lockheed Martin began moving 1,000 employees from its Aircraft Services Division in Ontario to its facility in the Air Force’s Plant 42 in Palmdale. About half of those workers have been moved so far. The unit will conduct aircraft modifications and retrofits on aircraft owned by the military, private companies and by other countries. Also last year, Skunk Works was chosen to share a $110 million contract with Lockheed Martin Electronics Division in Orlando, Fla. The two are joining forces to build nine prototypes of a new air-to-surface missile with the same “stealth” technology as used on the B-2. By the time all the hiring is done some time in mid-1998, Skunk Works will have augmented the Antelope Valley work force by about 2,500 jobs, Lindeke said. This will mean a total of about 10,000 civilian aerospace jobs at the Air Force’s Plant 42, a government-owned facility which houses the Skunk Works and several other private aerospace operations, including those of Boeing North American Inc. and Northrop Grumman Corp. Employment at the Antelope Valley’s other major aerospace facility, Edwards Air Force Base in Lancaster, where the aerospace companies have their flight-testing operations, has held steady through the past decade’s economic ups and downs at about 12,000 civilian and military, according to the Lancaster Economic Development Corp. About 3,000 of those jobs are held by civilians working for contractors such as Lockheed’s Skunk Works and Boeing. While Lawson credits aerospace hiring with fueling an economic resurgence in the area, Lawson said the local downturn in the early 1990s was not due to aerospace job losses. He said it was mainly caused by a drop in the housing market. “As far as job losses, we haven’t been significantly impacted since 1987, when the B-1 project concluded and about 6,500 jobs were lost,” he said, referring to the bomber which had been built there. “A lot of people went to work on the B-2 stealth soon after, and many of the rest went into housing construction. At that time housing was booming, but then the recession hit and they lost out.” The housing construction sector had been especially strong during the late 1980s and early 1990s; Palmdale was the county’s fastest-growing city, with its population growing about 4 percent a year. Then, housing values plummeted by more than 30 percent in the early 1990s, Lawson said. Thousands of construction workers were put out of work, and the related residential brokerage and escrow companies also suffered. Plus, while the Antelope Valley’s aerospace sector did not suffer significant post-Cold War job cuts, the nationwide recession of the early 1990s took its toll; thousands of Antelope Valley residents who commuted to L.A. urban areas lost their jobs. When the Lockheed Advanced Development Co. (now known as the Lockheed Martin Skunk Works) moved from Burbank to Palmdale in 1993 and 1994, the 3,000 or so relocated workers brought a major economic booster shot to the community. But even with that, housing sales continued to decline. Over the past year, however, the steady economic recovery of the greater L.A. area is helping to boost the Antelope Valley. Real estate officials said the new Antelope Valley jobs were a significant factor in fueling a 24.3 percent rise in single-family house sales last year over 1995 and an 11 percent rise in the first five months of this year over the like period in 1996. “Our office is seeing about 15 to 20 sales of houses a week, where last year at this time it was seven to eight a week,” said Ralph Bozigian, co-owner of Fred Sands, Mid-Valley Realtors. in Lancaster. “The new hiring activity has helped greatly, but we also get a lot of new people who can’t afford houses in places like the San Fernando Valley.” Bozigian said another indicator of the area’s improving economy is that about twice as many storefront leases have been signed so far this year as were signed in the first half of last year. “We’ve leased to doctors, a CPA, beauty salons,” he said. “Consumer confidence is strong; when you go to a restaurant on a Friday or Saturday night there’s a lot more people there than even a couple years ago.” Even with this growth, the Antelope Valley is far from secure when it comes to aerospace jobs. The longevity of a number of projects remains in doubt. Northrop Grumman, the area’s second-largest aerospace employer, plans to cut some 300 of its 3,000 jobs this summer from its B-2 Division, a production facility at Plant 42. Hundreds more may disappear after the last of 21 stealth bombers on order from the government is delivered in 1999. However, this doesn’t necessarily mean the end for the program. Congress may end up ordering more B-2s and the jobs could be saved; in late June, the House of Representatives approved funding to begin building nine more planes. “We’re not expecting approval of this anytime soon because that money must be approved by the Senate, which has announced defense priorities that do not include the B-2,” said Jim Hart, a Northrop Grumman spokesman. In addition, two of the Skunk Works projects may end within a few years. Because the joint strike fighter and the stealth missile are prototypes, they are not guaranteed to go into production and those jobs may be cut. Some smaller aerospace companies in the area are in the same boat. Tracor Flight Systems is one example. Last July, the aircraft components maker, located in Plant 42, won a 10-year contract to build wings for McDonnell Douglas Corp.’s MD-95, a 100-seat passenger jet. Tracor is adding 150 employees to its 80 in Palmdale and 320 in neighboring Mojave. However, the merger of Boeing and McDonnell Douglas expected to be completed this summer is likely to result in a halt in production of the MD-95 and other McDonnell Douglas jets. Tracor vice president and general manager Donald Sullivan said the contract was finalized before any glint of a merger was on the horizon, and he is unsure what will happen to the contract upon the merger’s completion. “I can’t be certain the sun will rise tomorrow, so I can’t be certain what will happen with this contract,” Sullivan said. As for Boeing North American, its Antelope Valley facilities were acquired from Rockwell International Corp. when Boeing bought Rockwell’s space and defense divisions last year. Since the massive job cuts in 1987 when B-1 production ended, employment at Boeing’s newly acquired divisions has held steady at around 550 in Lancaster and Palmdale. Most of those workers perform modifications and servicing on B-1s, 96 of which are still in operation. Rick Vanesler, Boeing’s director of quality assurance, said the company does not expect to add to or subtract from its Antelope Valley work force as long as those planes are still flying.