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Lockheed, Boeing to Start Furloughing Employees Next Week

Oct. 4, 2013 - 06:00AM   |  
By AARON MEHTA and MARCUS WEISGERBER   |   Comments
Boeing Posts 56 Million Quarterly Loss, And Its Cu
(Scott Olson/Getty Images)

WASHINGTON — Defense giants Lockheed Martin and Boeing will begin furloughing thousands of employees Monday if the US government shutdown continues next week, according to company officials.

Maryland-based Lockheed Martin will furlough approximately 3,000 employees on Monday, a number the company says will likely increase as the government shutdown continues. Employees from across Lockheed’s businesses will be impacted by the furloughs.

“We expect the number of employees affected by the shutdown to grow as we experience contractual actions and the impact of furloughs among [Defense Contract Management Agency] and other customer inspectors across our business and our suppliers’ businesses,” Lockheed CEO Marillyn Hewson said in a memo to employees.

“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,” Hewson added.

A Boeing spokeswoman said the Chicago-based company would begin furloughs next week if the shutdown continued. The company was still tabulating the number of impacted employees.

“Boeing is seeing increasing effects on certain daily operations that involve U.S. government facilities and people,” Meghan McCormick, a company spokeswoman said in an email. “Boeing will continue working with its customers and suppliers to maintain normal operations in as many parts of our business as possible. While the company is working to limit the negative impact of the shutdown on customers and employees, we expect more consequences could emerge in the coming days, including limited furloughs of employees in some areas.”

Earlier this week, Lockheed released a statement indicating it hoped to avoid furloughs.

“We will continue to conduct business with the same dedication to our purpose and commitment to our customers,” the company said then. “Unless we are directed otherwise by our customers, our facilities will remain open, and our employees will continue to receive their pay and benefits.”

When asked what changed, a spokesman for Lockheed said ongoing discussions with the Pentagon led the company to make a decision to begin furloughs.

“It’s in their interest and our interest to keep production moving,” the spokesman said. “They need what they bought, but they’re working within confines of the government shutdown as well.”

Just a day earlier, Boeing issued a much more positive statement that said it had “contingency plans in place to deal with interruptions to normal operations. Boeing has maintained an open dialogue with its customers and suppliers to maintain normal operations in as many parts of the business as possible. We continue to monitor the situation and provide updates on any interrupted operations.”

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