With defense budgets shrinking in the wake of Congressional spending cuts and a sharp reduction in U.S. forces abroad, NJIT has been given the opportunity by the federal government to examine the defense industry in New Jersey for its capacity to meet current and projected defense needs while also supporting company transitions into new markets.
Backed by a $5.67 million grant from the Department of Defense (DOD), the New Jersey Innovation Institute (NJII), an NJIT corporation, will work with aerospace and defense contractors in the state to bolster their market potential by assisting them in developing new products for existing markets and new customers for the products they already manufacture. These efforts are designed to benefit New Jersey's economy and protect its job base.
"The country's position as a world leader depends on the ability to support our soldiers and to make and supply our own gear at a time of need. We can't afford to put these capabilities at risk," said Donald H. Sebastian, president of NJII, which was created earlier this year to spur innovation and growth in a range of economic sectors, including defense and homeland security, by leveraging the resources of industry, government, and higher education.
"The technologies that allow us to keep our forces out of harm's way, including electronics, advanced materials, and information technology, are increasingly complex," Sebastian added. "Our specialized expertise can't be allowed to drift offshore."
NJIT has proposed to study and map the defense supply chain in New Jersey to help better align it with current and future market needs. Through visualization tools and web-generated information resources, companies that supply services and parts to defense and aerospace contractors will be connected to one another and given a ready grasp of defense supplier networks and contracts by geography, market trends, and key industry events, among other useful data.
The second step will be to help manufacturers broaden into non-defense markets to create business stability in the sector, boost the state's economy, and bolster its workforce. For example, a company producing infrared sensors for the defense market could build its capacity to supply sensors to commercial growth markets in Asia or in the oil and gas sector; a company specializing in precision machining of munitions could also supply the medical equipment market.
"Helping these companies find new ways to grow is critical for the state's economy, as well as for maintaining the viability of companies that form a supply chain that the Defense Department relies upon," shared Tim Franklin, NJII vice president and principal investigator for the project, known as MarketShift.
The aerospace and defense industry is particularly important in New Jersey, where the U.S. military is the second largest employer and an essential economic driver. New Jersey is home to seven major military bases including Picatinny Arsenal and McGuire-Dix-Lakehurst and major defense contractor facilities, including Lockheed Martin Naval Electronics and Surveillance Systems-Surface Systems, Exelis Electronic Systems, BAE Systems, and L-3 Communications Systems. DOD activities are responsible for more than 20,000 jobs here and $5.4 billion in direct revenue to the state's economy annually.
Looking forward, contractors face further cuts projected under the Budget Control Act of $1.2 trillion through 2021 in deficit reductions, with $500 billion to be absorbed by the defense sector alone. One of NJIT's first tasks will be to provide New Jersey and its localities an understanding of the regions and industries that would be adversely affected by cuts in defense spending.
In late summer, NJII began hiring staff and engaging contractors to lead and manage MarketShift's activities, to establish partnerships, and to form nine user groups, sector-specific companies that will help identify needed tools and services and work with the MarketShift team to develop them. These groups will engage 100 or more New Jersey companies, Franklin said. NJII will host an official kickoff with a symposium on October 31 at NJIT and will launch the user groups in January.
"With DOD contract levels in New Jersey reflecting significant federal budget reductions, not surprisingly, the state economy has been adversely affected. MarketShift offers programs to help companies diversify their markets, strengthen their product line, and employ a globally competitive workforce," Franklin continued. "The user group members will be able to tap a wide array of programs available at NJII and NJIT, and from MarketShift partners, including agencies and organizations across the state that provide training and other support around innovation and marketing services. Having government, the private sector, and higher education partnering together is the way economic development works best in this economy. Better jobs and more of them should be an important result."
"National and global suppliers can go wherever the clients are, but small businesses, which are less mobile, are more vulnerable," said Carmine Spinelli, a consultant and former technical director for the Picatinny Arsenal, a federally designated Joint Center of Excellence for Armaments and Munitions and supplier to the U.S. military. "The MarketShift team will help them transition to commercial products in some cases, while also training companies to better compete in the defense market. Homeland Security is a sector where defense contractors with expertise can compete commercially in areas such as safety, security and surveillance.
Spinelli, a member of MarketShift's defense user group who also sits on the New Jersey Council on Veterans' Affairs, noted that training will range from overall marketing strategy to specific work, such as writing a new business plan.
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To learn more about MarketShift, please contact Timothy Franklin at franklin@njit.edu.
To attend the MarketShift kick-off event on Oct. 31, please register at: https://www.eventbrite.com/e/nj-marketshift-defense-aerospace-project-kick-off-event-tickets-13394452167.
About New Jersey Innovation Institute
The New Jersey Innovation Institute (NJII) is an NJIT corporation that applies the intellectual and technological resources of the state's science and technology university to challenges identified by industry partners. Through its Innovation Labs (iLabs), NJII brings NJIT expertise to key economic sectors, including healthcare delivery systems, bio-pharmaceutical production, civil infrastructure, defense and homeland security, and financial services.
About NJIT
One of the nation's leading public technological universities, New Jersey Institute of Technology (NJIT) is a top-tier research university that prepares students to become leaders in the technology-dependent economy of the 21st century. NJIT's multidisciplinary curriculum and computing-intensive approach to education provide technological proficiency, business acumen and leadership skills. With an enrollment of more than 10,000 graduate and undergraduate students, NJIT offers small-campus intimacy with the resources of a major public research university. NJIT is a global leader in such fields as solar research, nanotechnology, resilient design, tissue engineering and cyber-security, in addition to others. NJIT ranks fifth among U.S. polytechnic universities in research expenditures, topping $110 million.