Remaining Competitive Drives APL to Staff Cuts The Applied Physics Laboratory's decision to cut its full-time work force by about 350 is driven not just by cuts in federal defense spending, but also by possible changes in the way the Pentagon does business, lab director Gary L. Smith said. As the defense budget shrinks, the Navy has become interested in opening up for competition some of the work that-- because of APL's unique capabilities--historically has gone to the Hopkins lab through sole-source contracts. "We must be prepared to compete effectively for these tasks in appropriate circumstances, and cost will be an important factor in our being successful," Dr. Smith said in a letter to his staff last week announcing the first widespread layoffs in the lab's 53-year history. The director said that total lab funding this fiscal year-- from the Navy and other sources--is now expected to total no more than $407 million, a cut of 13 percent from last year's $466 million. Budget estimates for next year are even lower. The APL work force cuts come at a time of great uncertainty for all defense contractors. As federal defense spending has been reined in, there have been a number of mergers among defense and aerospace companies. There also have been substantial layoffs in both merged and stand-alone companies, including some industry giants with major facilities in Maryland. Dr. Smith said APL has worked hard to control costs and avoid major layoffs, but that the current budget outlook leaves little choice. "Reductions in non-labor costs will not be sufficient," he said. "Reductions in the size of the staff will also be necessary." APL spokeswoman Dee Reese said the lab expects to lay off about 7 to 9 percent of its own full-time staff of about 2,750, and to cut the number of contractors' employees working at APL-- presently about 700--by about 19 to 21 percent. "Even though the size of the planned staff reductions is modest compared to many already experienced by other defense-related organizations, it is still a painful decision for us to notify even a single employee of such action," Dr. Smith said. APL, founded in 1942 and now located just south of Columbia, Md., is a major research and development center for the Navy, working on technology for weapons, command-and-control and other systems. It is also the largest private employer in Howard County. Though the Navy accounts for the bulk of APL's budget, the lab also does work for other government agencies--such as NASA and the Department of Transportation--and works on research projects in collaboration with other Hopkins divisions, particularly the schools of Medicine, Engineering, and Arts and Sciences. Notices will go to affected APL employees by the end of May; most of the reductions should take place by the end of August, Reese said. There will also be layoffs among part-time and temporary staff, but the extent of those cuts has not been determined. All lab departments will be affected, but not necessarily in equal proportion, Dr. Smith said. Decisions on which will be hardest hit will depend on which programs can be expected to continue to attract the funding needed to support them.
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