14 DAY TRIAL // The US government shutdown has a major impact on defense contractors. Lockheed Martin has announced that around 3,000 employees have been identified for furlough starting Monday, October 7.
The company warns that the number might increase if the US government doesn’t resume its activity. The impacted employees are those who have received stop work orders, those whose tasks require a government inspection that cannot be completed, and those who work at government facilities that have been closed.
“I‘m disappointed that we must take these actions and we continue to encourage our lawmakers to come together to pass a funding bill that will end this shutdown," stated Marillyn A. Hewson, Lockheed Martin CEO and president.
“In an effort to minimize the impact on our employees, we are directing affected employees to use available vacation time so they can continue to receive their pay and benefits. We hope that Congress and the Administration are able to resolve this situation as soon as possible.”
Lockheed Martin is not the only defense contractor that announces such measures.
According to Forbes, The Sikorsky helicopter unit of United Technologies Corporation (UTX) will furlough 2,000 people on Monday. An additional 2,000 have been identified for furlough at the company’s Pratt & Whitney engine business.
1,000 employees from BAE Systems’s intelligence and security sector have already been laid off.
Several military contractors are affected by the fact that the Defense Contract Management Agency (DCMA), which conducts required inspections, has furloughed 85% of its staff due to the shutdown. The Defense Finance and Accounting Service is also expected to stop functioning next week.
In the meantime, cyber security experts warn that the US government shutdown poses a great threat. Basically, during this period, there will be less people attending critical systems, giving cybercriminals the opportunity to strike.