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Benefits of Being a Defense Contractor in San Diego

government contracting news and events Feb 14, 2024
Woman reading a report

If you’re a defense contractor in San Diego, I have a question for you: Are you a defense contractor because you live in a military town, or do you live in a military town because you’re a defense contractor? While you pause to think about it, I will sum up why (regardless of cause or effect) it’s a good thing you’re here!

In October, the San Diego Military Advisory Council (SDMAC), in collaboration with UC San Diego's Rady School of Management, released the 2023 Military Economic Impact Report (MIER). Based on academic research and comprehensive data analysis, this report calculated the impact of military dollars on our region’s economy. It concluded that defense-related spending contributed $56.5 billion to San Diego county economy in FY 2023. That's 23.6% of San Diego gross regional product. Of that amount, an estimated $19 billion was specifically allocated to defense contracting (i.e., Funds Obligated) to the more than 1,700 large and small businesses that support the U.S. Navy, U.S. Marine Corps, U.S. Coast Guard, and other DoD organizations around town. According to the MIER’s findings, the top 10 companies who took the biggest pieces of the $19 billion pie were:

  1. General Atomics (18.6% – $3.5B)
  2. General Dynamics (15.7% – $2.9B)
  3. Northrop Grumman (9.4% – $1.78B)
  4. BAE Systems (2.9% – $551M)
  5. Booz Allen Hamilton (2.7% – $513M)
  6. Aevex Aerospace (2.6% – $494M)
  7. Continental Maritime (2.3% – $437M) 

The top 10 types of programs these defense contracting dollars funded in the area were:

  1. Cargo and Tanker Vessels (12.7%)
  2. Professional Services: Engineering/Technical (11.3%)
  3. Non-nuclear Ship Repair (9.9%)
  4. Maintenance/Repair/Rebuild (Aircraft and Airframe Structural Components) (7.9%)
  5. Unmanned Aircraft (7.3%)
  6. IT and Telecom – Business App/App Development Support Services (2.6%)
  7. Professional Services: Program Management/ Support (2.4%)
  8. National Defense Research and Development (R&D) Services; Experimental Development (2.0%)
  9. Support – Management: Logistics Support (1.7%)
  10. Aircraft Launching Equipment (1.7%)

This year’s report highlighted the region’s Defense Innovation Economy. San Diego has world-class research institutions near major installations and is home to established tech companies such as Qualcomm and Viasat. Over the years, this has positioned the region as a leader in defense technology. As more local companies (established or start-up) and government programs continue to focus on research and development, technology transfer, etc., San Diego is sure to secure its place as a top Defense innovation hub in the country.

And with more than 354,000 people currently employed in defense-related jobs in the region (111,000 active duty service members, 7,000 Reservists, 26,000 civilian employees, and nearly 206,000 defense contractors), there is no shortage of local talent to fill the wide array of labor category (LCAT) requirements these Defense programs are (and will be) looking for.

As we can see, San Diego has a strong and resilient Defense/Military economy for you to build your business and offers a stabilizing effect you can rely on. The reason is (in large part) that defense-related spending tends to be programmatic in nature; that is, it’s intended to build and maintain the Force required to deter foreign aggression and counter threats over the long run. And with a growing emphasis on technology innovation, this future-focused economy is guaranteed to stay strong and resilient in the years to come.

2023 Report Indicators for the Future

How does this translate to Trident’s work in Capture and Proposal Management? I see several promising indicators for business success in this local industry we proudly serve:

  1. $19 billion equates to a lot of contract awards, which means a lot of opportunities for business growth.
  2. The top 10 program types listed above indicate a demand for varied skill sets, products, and services, which means the Defense programs here are probably looking for whatever you’re selling.
  3. Defense Innovation is likely to attract more talent and more investment into the region, which means more economic growth in the region, which means (you guessed it!) more opportunity for business growth.
  4. With so many locals currently employed in the industry, there is already a large pool of qualified and experienced personnel to staff your contracts.
  5. With 1,700 companies in the region, there are a lot of opportunities for teaming, mentorship, Joint Ventures, etc. If you’re a small business, I would try to establish strong ties (maybe even mentorship) with any of the top 10 vendors listed above (based on relevance and alignment).
  6. And last but not least, it just so happens that the place of performance is America’s finest city! 

If you’re interested in pursuing bids in the San Diego area, our team of capture and proposal experts would like to be part of your planning conversations. Contact us today!

Written by Alexis Romero
Alexis is our Business Intelligence Lead, Orals Coach, and a capture and proposal expert at Trident. She brings extensive experience in defense contracting, proposal management, business and pipeline development, orals coaching, and UI / UX to our clients. Based in San Diego, she supports clients around the world as part of our globally dispersed team.

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