The National Steel and Shipbuilding Company (NASSCO), which builds and maintains Navy ships, has informed hundreds of workers that they could start losing their jobs by the end of April if the Navy cancels or delays contracts, a spokesman said yesterday.
Jim Gill, spokesman for the San Diego-based division of General Dynamics [GD], said 730 ship maintenance employees and subcontractors could be subject to termination at the southern California shipyard and at a second facility in Mayport, Fla. The workers received the notifications Tuesday.
“We informed employees we may indefinitely lay off up to 730 in San Diego and Mayport beginning in late April,” Gill said. “These actions are a direct result of information recently furnished by the Navy regarding the possible cancellation or delay of maintenance or repair work.”
Those numbers could go “up or down” depending on the course taken by the Navy, Gill said. The Navy earlier this month informed private shipyards of possible contract cancellations or delays for ship maintenance because of the budget stalemate in Congress (Defense Daily, Feb. 19).
The Navy has said it will likely have to take those steps if automatic budget cuts known as sequestration take effect starting Friday, and if the Pentagon is subject to a continuing spending resolution (CR) for the rest of the fiscal year, which ends Sept 30. The current CR expires at the end of March.
The CR, which is standing in place of a proper appropriations bill and keeps funding at around fiscal 2012 levels, prohibits the start of new ship maintenance projects. Some lawmakers are looking to push through an exception to that rule but do not appear to have enough support. The Navy has warned of billions of dollars in budget shortfalls under a CR and sequestration.
“Navy leadership has been very open and very public about the looming impacts of the budget shortfalls,” Navy spokeswoman Lt. Courtney Hillson said. “We’re still hopeful that we’ll be able to retain the flexibility to reverse some of these decisions and we continue to hope that a debt deal will be reached and an FY13 spending bill can be passed.”
“We’ll endeavor, as we said we would, to not cancel this work, which can ultimately be preserved, and keep our actions reversible to the maximum extent possible,” she added.
The notified maintenance crew workers include 375 NASSCO employees in San Diego, 65 in Mayport plus an additional 290 subcontractors, Gill said. NASSCO employs 2,800 people across all parts of its San Diego business, he said. In addition to maintenance, NASSCO builds auxiliary ships for the Navy.
Beci Brenton, a spokeswoman for Huntington Ingalls Industries [HII], said the company issued possible layoff warnings to 185 employees at its Continental Maritime of San Diego yard on Feb. 11, meaning layoffs could begin by mid-April under the 60 days-notice required by federal law. BAE Systems San Diego Ship Repair earlier this month informed more than 1,300 employees of possible layoffs, according to the San Diego Union Tribune.
The Navy has identified eight ships that would be subject to maintenance cancellations or delays in San Diego under a combination of a year-long CR and sequestration, equating to $175 million dollars in work for NASSCO and other shipyards in San Diego, according to documents provided by the service