August 01, 2012

Temporary Workforce and Defense Sales in Aerospace: A Crucial Phase

Sales in Aerospace Defense are on average 64% of the total sales in aerospace. More sales mean more resources, and aerospace defense mostly employs workers on demand (contingent) (Refer graph above). Contingent workforce continued upwards from 2009 to 2011, rising 11.68 index point from the reference baseline, whereas permanent staff declined by 3.11 index points.

What is also evident from the graph is that the sector has gone against larger market trends of higher temporary workforce growth and slow growth in permanent staff. One likely reason could be greater absorption of temporary staff in permanent roles and no major growth in the overall size of the pie. Sales trends for defense and civil spending buttress that argument.

Defense sales, which are mostly governed by the federal government defense budget allocation, are the driving force for business in the sector but implementation of impending Sequestration Act may change all that.