NDIA STEM WORKFORCE DIVISION

1. NDIA STEM WORKFORCE DIVISION Edward Swallow NDIA STEM Workforce Division Chair Vice President, Northrop Grumman

2. Mission • Provide a forum for effective interaction between government, industry, academia and the public at large for the strengthening of the national security Science, Technology Engineering and Mathematics (STEM) workforce. • Objectives • Increase NDIA’s chapter, division, affiliate and member company participation in exciting and attracting K-12 students into STEM careers • Foster cooperation between federal departments, agencies and industry on STEM workforce development initiatives • Support the development of integrated polices around the STEM workforce • Establish partnerships to collect and disseminate information and coordinate resources to build a robust STEM workforce of the future. • Vision • “It is critical to our National Security to create a continuous and diverse supply of quality, clearable STEM workers in order to sustain our National Security supremacy and economic competitiveness” STEM Workforce Division

3. STEM Workforce Division Board Members IDIQ, Inc. Omnisat, LLC

4. STEM Workforce NeedsData Availability • For last 3 years, Aviation Week & Space Technology, NDIA and AIA have collaborated on an A&D wide survey of STEM Employment • Valuable data around hiring trends, retirement trends, vacant positions, etc. are available • Presenting a subset today to help understand a couple of points • DoD budget variability does not appear to directly correlate to Industrial STEM employment variability • Program variability does (i.e. what programs/initiatives are being funded) • The Perfect Storm has been postponed – for a little while • Retirements will pick up as soon as the stock market does • Supply does not meet demand today, and it’s getting worse

5. Industry Average Age • Average age 2009 and 2005 was 44 • YPs in 2000 = 35% vs 22% in 2010 Average Age: 45.7 Source

6. Retirement by Size Source

7. Open Requisitions 2010-2012 (projected) Source: Aviation Week 2010 Workforce Study

8. Supply Chain ModelCurrent STEM Graduates Proficient (proficient or advanced) Proficient Interested STEM Major Graduate With STEM Degree 17% 278,000 in 2005 167,000 Expectedin 2011 (1) 32% Proficient Not Interested Non-STEM Major Not Proficient (basic or below basic) S&E Degrees Awarded Per Year (Millions) 25% Not Proficient Interested 68% 15% 2-year College 1998 2006 Proportion of S&E of first university degrees in 2006 Not Proficient Not Interested China USA 47% 16% 42% Total = 1.7M Total = 1.5M 4,013,000 Beginning 9th grade in 2001 2,799,000 Grads in classof 2005 1,170,000 Enrolled in 4-year College Elementary Secondary College Career Source: 2011 Department Of Education, Michael Lach, Special Assistant to Secretary for STEM

9. Conclusions • The Perfect Storm “Category 5” is near • Low supply of clearable, highly skilled workers, engineers and scientists is real • Salaries are accelerating which indicates demand outstripping supply • The DoD Budget is only part of the challenge • If the economy improves, retirement goes up rapidly and demand accelerates • If the economy continues to stagnate or decline, retirement stays low and supply starts to overtake demand • If the demand increases significantly due to abrupt change in security threat, salaries will accelerate as the supply tries to keep up • Rotation through the industry and mid-career entrants will be required • The 2012 McKinsey-AW&ST-NDIA-AIA Survey has a “2012 Baseline DoD Budget” Built In • Excursions can provide insight for the study estimating process

10. "We can't solve problems by using the same kind of thinking we used when we created them” Albert Einstein Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius -- and a lot of courage -- to move in the opposite direction Albert Einstein

11. 2010 Aviation Week and Space Technology Survey Results • Designed to provide a single reliable source for workforce data in the aerospace and defense (A&D) fields • Findings: • The number of open positions at companies for new grads dropped • Retirement rates declined • College campus hires growing, however, among large organizations • Recent economic pressures have led to pay rate fluctuations • Increasing levels of voluntary attrition are being combated by promotions in small organizations • Voluntary attrition rate has declined to 6.71% from 9.7%, which it was last year • Young professionals achieve a rate exceeding 20%, however

12. 2010 Aviation Week and Space Technology Survey Results • Real job growth in 2009 was at 3%,with 2010 declining to 1.5% • 7,000 current job openings in 2010. This slowdown from the 27,000 open reqs in 2008 is attributed to economic downturn • 58% of engineering jobs in 2010 require some kind of security clearance, up from 53% in 2008 • There is still a need to monitor students throughout schooling and put them on track for a clearance • There is a projected drop in the hiring of aerospace engineers in 2012: from 211 to 20 • There will be an increase of software, electrical, and materials engineering in 2011 • May be tied to increased demand from two rotorcraft and one tanker program • There is an increase in the demand for supply chain experts • 153 as of April 2010, but 400 predicted for the rest of 2010, as well as each subsequent year going to 2012