Last month, the United States' largest military defense engineer company downsized the Mission Systems and Training department by 600 employees and there are signs that Lockheed Martin plans to lay off more staffers by mid-2015, the Washington Post reported.
Another 4,000 positions in the Missions Systems and Training, Information Systems and Global Solutions and Space Systems departments will be cut in 2015, and locations in Texas, Arizona, Pennsylvania are expected to close. Operations at the Sunnyvale, California on the other hand will continue, but with four fewer buildings.
Lockheed Martin has been working on downsizing its operations since 2008. So far real estate has been reduced by 1.5 million square feet and the workforce has 30,000 fewer employees. Because Lockheed Martin plays a larger role among other defense industry companies, other competitors are likely to make their own layoffs as well.
"These closures and layoffs are emblematic of a trend in Pentagon demand that's going to lead all of their competitors to make similar moves," Loren Thompson, defense industry consultant, told the source.
Due to how demand has shifted for their biggest client, the Pentagon, increasing profits have been difficult. The Bethesda, Maryland-based business is expecting that government spending patterns will change in the future, which means that "these actions are necessary for the future of our business," Lockheed Martin CEO Marillyn Hewson said in a statement.
Though Lockheed Martin's decision to make these layoffs were not in direct result of the sequestration and last month's government shutdown, Roman Schweizer, a policy analyst at Guggenheim Partners, added that possible sequestration cuts in February might.