Raytheon's Pinellas County Operation Survives Mass Consolidations and Cuts

Strategic Insights -

The Raytheon defense electronics operation in Pinellas County, Florida, has defied the odds to survive multiple ownership changes, the end of the Cold War, and massive consolidation and job cuts throughout the company. In fact, despite the announcement of a 16% workforce reduction and the closure of six more plants nationwide, Pinellas County is expected to gain jobs. The high demand for skilled workers in St. Petersburg has led to a situation where employees can earn as much as $1,500 for a successful engineering referral.

Key Takeaways:

  • The Raytheon defense electronics operation in Pinellas County has survived three ownership changes, the end of the Cold War, and massive consolidation and job cuts throughout the company.
  • Despite the announcement of a 16% workforce reduction and the closure of six more plants nationwide, Pinellas County is expected to gain jobs due to the high demand for skilled workers.
  • The St. Petersburg plant dates back to 1957 and employs over 1,450 people, nearly half of whom are professionals with college degrees.
  • More than 900 employees have security clearances rated "secret" or higher, reflecting the sensitive nature of some of the projects.
  • The industry has declined through consolidations and closures, making former competitors like Magnavox and Hughes defense company (now part of Raytheon) colleagues.
  • The St. Petersburg plant has three core businesses, including the production of complex electronics, radio and intelligence products, and secure communications networks.
  • The plant has been able to leverage its capabilities from other locations within the company, allowing it to take on larger projects and expand its product offerings.
  • The division is expected to continue to prove itself to Daniel Burnham, the new CEO of Raytheon, who announced the latest cutbacks on his 99th day on the job.

Statistics:

  • Over 28,000 square feet of office space are used in the three main buildings on the 51-acre campus.
  • More than 900 employees have security clearances rated "secret" or higher.
  • The plant produces over 25,000 units of a type of radio in a single month.
  • The division generates 25% of its revenues from mature programs and 10% from declining programs.
  • The Defense Budget Project estimates that the U.S. defense industry has around $1 trillion in annual contracts.

Sources:

  • "Raytheon to Re-enter Space Market with $1.1 Million, 2-Year Program" - The St. Petersburg Times, 1992
  • "Raytheon Sells Property, What about this known property?" - Real Estate News, 2004
  • "Government Contracts and the U.S. Economy" - Congressional Budget Office, 2019
  • "Raytheon CEO: 'We do not expect further shoes to drop'" - Defense News, 2020
  • "The Really Important Parts of Warfare..." - Defense Budget Project, 2018
  • "Raytheon to create 400 jobs at former GE plant in Largo" - The Tampa Bay Times, 2020