ORLANDO, Florida — On the Monday morning of Memorial Day, Randy Tejada arrived at a picket line outside Lockheed Martin’s enormous missile factory here, joining about 40 of his colleagues as they stood on a grassy median nearby, holding signs and waving at the passing cars. The missile factory, strangely, was nestled between Disney World and Universal Studios; a giant Ferris wheel loomed across the street from the picket line, creating an almost festive atmosphere. But Tejada had a serious look about him, like a soldier taking up watch duty. He wore a tee-shirt that said: “Grumpy Old Vet. I do what I want.” The air was sweltering, but Tejada said he wasn’t bothered.
“I can stay here as long as I need to,” he said. “I’ve got experience in standing around for hours.”
He was citing his past career in the military: Tejada is a 32-year-old retired U.S. Army helicopter mechanic who joined Lockheed Martin in 2022 on the assembly line. But this spring, after two years of going back and forth with management over problems with his pay, Tejada, along with several hundred of his Orlando colleagues, decided he’d had enough. Wages weren’t keeping pace with inflation; between late 2020 and mid-2022, for example, workers got a 3 percent pay bump as inflation rose by 12 percent. Their health care plans were expensive, the pensions enjoyed by older workers had vanished and the cost of rent in Orlando was skyrocketing. When Lockheed Martin offered the labor union a new contract this spring, the union asked for double-digit pay increases to cover higher costs. The company offered about 3 to 4 percent instead. On May 1, the employees walked off the job and went on strike. For nearly a month, they left empty the workstations where they once assembled missile components, surveillance systems and other defense equipment. The striking workers heard that Lockheed Martin was employing managers, engineers and contract workers to keep the factory going.
The Lockheed strike was part of a wave of labor unrest that swept America’s military-industrial complex over the past year. On May 1, about 4,000 workers went on strike. Nearly 1,000 of them worked for Lockheed Martin, both at Tejada’s facility in Orlando and at another complex in Denver. It was the first labor strike at the Orlando factory since 1963. Another 3,000 employees went on strike in Hartford, Conn., against Pratt & Whitney, which makes engines and other critical components of Lockheed Martin’s F-35 fighter jet. In mid-May, about 2,500 employees of General Dynamics nearly went on a strike at a nuclear submarine factory, before reaching a last-minute deal that kept them on the factory line. Last fall, 33,000 workers went on strike at Boeing, affecting production of both commercial and military aircraft and winning a 38 percent pay raise after seven weeks.
Something is going wrong on the assembly lines of America’s arsenal of democracy, and it’s happening at a moment of crisis. The White House, Pentagon and America’s overseas allies are all demanding that defense companies ramp up production to meet the needs of a dangerous geopolitical moment. America is running short of missiles, munitions and battleships. Allies are waiting years for deliveries. Even the Pentagon has to stand in line and wait for delayed shipments of major weapons, like Hellfire missiles, Javelin rocket launchers and sophisticated air defense interceptors. America is trying to surge its military capacity to produce more munitions, missiles and ships, but to do so, it must rely almost entirely on a group of five Fortune 500 defense companies. And none of these companies seem to be on war footing.
Instead of hiring more workers and paying workers more in an effort to retain them, these companies are far more focused on meeting the demands of Wall Street, trying to entice investors and boost their stock price by cutting costs, as well as using billions of dollars in revenue to pay handsome dividends and buy back shares of stock. Last year, for example, Lockheed Martin gave $6.8 billion in buybacks and dividends directly to its shareholders, which amounted to nearly 10 percent of the company’s total revenue and was larger than the $5.3 billion it kept in profits. The same year, RTX (formerly called Raytheon) paid $3.7 billion to shareholders, General Dynamics paid $3 billion and Northrop Grumman paid $3.7 billion. The billions of dollars they send back shareholders each year means that there is less money to go toward paying, hiring or retaining their employees.
As a result, jobs in defense manufacturing are becoming less and less attractive at a time when they need to be getting far more attractive. Many workers are leaving the field or declining to enter it. A survey by the job recruiting firm Acara found that annual turnover in the defense and aerospace industry hit 13 percent in 2023, compared to an average U.S. rate of 3.8 percent. And this is happening just as the need for those skills is rising. Demand for advanced manufacturing skills in the sector is outpacing the number of trained employees, and 75 percent of defense companies are struggling to find qualified employees, the survey found.
Take Tejada. He is exactly the kind of employee that the Pentagon desperately wants companies like Lockheed to hire. He’s experienced. He’s patriotic, with military experience. And he wants to build a career in the defense industry. His union in Orlando represents more of those kinds of workers. A lot of the employees in it attended a local community college industrial training center where they learned how to assemble complex circuit boards and to run ultra-high-precision machining tools. And many of them have worked at Lockheed Martin for years, if not decades, building the type of expertise that is currently in such high demand.
On the afternoon of May 1, those employees closed up their workstations, put away their tools and decamped to a grassy median along the west side of the Lockheed missile factory. They set up tents and folding chairs and unfurled large banners with inflammatory declarations about corporate greed and unfair labor practices. The several hundred members of UAW Local 788 launched a campaign that day that would, over the next few weeks, turn into a long and grinding campaign.
For the Pentagon, it should have also been a flashing red light — the latest in a long-simmering labor conflict that, from another angle, is also a growing national-security problem.
The landscape around the strikers was surreal in a particularly American way. Back when the missile factory was first opened in 1957, Orlando was a small town surrounded by cattle ranches and citrus groves. It has since transformed into the Mecca of American escapism. The missile factory is surrounded by Universal theme parks, Walt Disney World and a host of busy hotels and convention centers. On rainy nights along the picket line, the fireworks from Disney World could be heard crackling in the clouds while below, the UAW workers held their positions around the clock. They sat in chairs through the nights and waved their signs in the morning, determined to outlast Lockheed in a battle of attrition.
Historically, in the fight against their bosses, unions have had only one real weapon to wield: their numbers. The primary goal of a labor strike is to blockade production and inflict pain on the company so that it will negotiate better terms. But in Orlando, it was hard for the union to enlist enough workers for the fight. Florida is a “right to work” state, meaning that union membership is optional. Workers in an organized factory are free to return to their stations and get back to work, leaving everyone else on the picket line to fight for a contract that would eventually apply to everyone.
The burden of maintaining a successful picket line rested on the shoulders of hourly workers like Gideon Spence, a 37-year-old machinist at the missile factory who constructs finely honed components of weapons systems for the F-35 and Hellfire missiles. Spence is a burly guy with a thick red beard and bright blue eyes who is obsessively focused on his craft. He operates something called a Computer Numerical Control machine, or CNC for short, that shapes raw metal into precision weaponry, with a margin of error that is measured in the millionth of an inch. Spence is on the younger end of the Lockheed workforce, a member of the new generation of workers that military contractors are trying to attract and train. Lockheed Martin, like other contractors, has suffered a wave of retirements over the last decade as the skilled workforce it built up during the Cold War aged out into retirement, draining the best-trained and most experienced employees. This “experience drain” is a key concern for the Pentagon, which it has primarily addressed through education, such as with vocational programs at community colleges or other centers outside the defense companies themselves. But people like Spence are entering the field and quickly discovering that it’s very different from the one described by industry veterans at the union hall.
Unlike his elders, Spence doesn’t have a pension, he has to pay for more of his health insurance out of pocket, and his pay raises have fallen far behind the rising cost of rent, auto insurance and grocery bills. Spence lives about an hour away from the factory because he can’t afford a place in Orlando. Spence also belonged to a generation that often sees labor unions as a relic of the past. In the 1950s, labor unions represented about 30 percent of private-sector workers in the United States. When Spence joined Lockheed, they represented about 6 percent.
The weakness of the union made it a vulnerable target. On the first day of the strike, just hours after workers took up their picket signs, Lockheed Martin’s labor relations team launched a series of precision strikes that seemed aimed at breaking the union’s resolve. On the first day of the strike, union members received an email from Lockheed’s human resources department, sent to their personal accounts at 1:14 p.m. The email’s subject line read: “Procedure to Resign from the Union and Cross Picket Line.”
The text of the email laid out how anyone could file a letter of resignation from the union, notify their manager of the decision and be back on the job at full pay the next day. The email included carefully written statements pointing out that the H.R. team wasn’t recommending that anyone should do this, which might be a violation of labor law, but was simply explaining how to do it should anyone want to.
Lockheed Martin declined to comment in detail for this story. The company issued a statement in response to several detailed questions, pointing out that it engaged in good faith bargaining with the labor union throughout the strike. “These negotiations reflect our shared commitment to supporting the highly skilled workforce that drives our business and advances our national security mission,” the statement said.
On May 23, after three weeks of the strike, a spokesman for the Pentagon’s Missiles and Space Program Office said the Department of Defense had not yet seen an interruption in delivery for Hellfire and so-called JAGM Missiles, important munitions that are designed in Orlando, although full production is spread across several plants. Both missiles were currently on backorder with multi-year wait times, but it didn’t appear the strike would significantly extend those waits. He added: “We will continue to monitor very closely.”
The history of labor unions and the military-industrial complex can best be described as long and tortured.
There has always been an affinity between the two camps. One of the primary promises of an expanded defense industry is that it provides well-paying jobs around the country, a fact that companies like Lockheed Martin heavily promote. Since the 1950s, labor unions have seen the defense industry as a key lifeline to advanced manufacturing jobs, a trend that only accelerated after deindustrialization swept America starting in the 1970s. The weapons industry has now become one of the last vibrant islands of sophisticated manufacturing work in the United States.
Defense jobs account for about 10 percent of America’s manufacturing output, and the bulk of those jobs are high-end, advanced manufacturing that require a lot of skill and training. Lockheed Martin’s F-35 factory in Fort Worth, Texas, for example, contains a mini-factory within it where engineers and production experts build new robots to automate and streamline more parts of the assembly line. The assembly line itself is staffed by workers who painstakingly install expensive sensors and components into every tiny niche of the plane’s body.
But in important ways, the interests of unions and the defense industry have also always been at odds. Defense contractors and the Pentagon have an overarching interest in making weapons as cheaply as possible, which means keeping labor costs low.
These tensions intensified in the aftermath of the Cold War. In 1993, Secretary of Defense Les Aspin called a group of major defense industry CEOs to a dinner that became known as “the last supper.” The companies were encouraged to merge with one another to reduce their output in an age of shrinking military budgets after the Cold War. They did, consolidating control within five firms. Not even a full decade after those mergers came 9/11, after which military budgets exploded, but the same five firms dominate the market, receiving about one-third of all Pentagon contracts and contributing to about 74 percent of all major weapons systems, according to a 2024 report from the Congressional Research Service. Today, Lockheed is the biggest of all these contractors. It received $313 billion dollars of the $2.4 trillion that went to defense contractors over the past five years, more than twice as much as the next biggest company, RTX, according to a new report by the Quincy Institute for Responsible Statecraft and the Costs of War project at Brown University. Lockheed’s F-35 program is the single largest weapons program at the Department of Defense.
These defense companies had tremendous leverage when negotiating with the Pentagon during the War on Terror, according to Frank Kendall, who was the Air Force secretary from 2021 to 2025 and who previously served as head of acquisitions from 2011 to 2017. “With size comes power, and the Department’s experience with large defense contractors is that they are not hesitant to use power for corporate advantage,” Kendall wrote in a 2017 book on the acquisitions system. This meant that the companies would stubbornly bargain for months at a time for higher contract payments or better terms on project upgrades, for example, even when the Pentagon was eager and ready to move forward.
Kendall, while he criticized the companies, also reflected a widespread sentiment inside the Pentagon that the companies also had an imperative to earn profits in order to remain healthy: “Profit isn’t optional for businesses,” he wrote. The key was to make sure that the profit motive could be well-aligned with Pentagon priorities.
But the years after 9/11 would show how difficult it was to align these priorities. During the 2000s, the big defense contractors worked relentlessly to expand their profit margins, make their production lines as lean as possible and boost their annual sales. Raytheon’s stock price nearly quintupled from 2001 to 2021 while Northrop Grumman’s rose nearly 700 percent. Lockheed Martin did exceptionally well between 2001 and 2022, when the company’s stock price rose more than tenfold from $34.68 to $389.13 a share. The profitability came, in part, because Lockheed was focused on keeping labor costs low and supply lines trim.
In Orlando, the factory was running at high production during the War on Terror, said Billy Masters, a missile machinist who was the local union president until 2024. “We couldn’t make enough Hellfire missiles. As soon as we were shipping them, the paint was drying, and they were shooting them off,” Masters recalled during an interview in the local union hall in 2022. Employees felt like they were falling behind, especially in the later years of this long span, from about 2015 to 2022. Masters said in 2022 that many of his employees could barely afford apartments in the Orlando area, and one of his new hires was sleeping in her car. That year, an entry-level employee at the factory earned a minimum of $15.45 an hour, which was less than some service-sector jobs in the area. In 2025, a local Buc-ee’s gas station advertised wages for “restroom crews” starting at $20 an hour and car wash employees at $21 an hour.
A lot of people joined Lockheed because they thought it would provide a good long-term career path, but Masters said they found it difficult to live off the wages as they worked their way up the ladder.
“We cannot keep people!” Masters said. “They bring them in on the low end of the pay scale. … They want cheaper wages. They want to keep the wage down. We’re up against profit over anything else.”
This system delivered plenty of profits and munitions over 20 years of the War on Terror, but it seemed to hit a breaking point after Russian President Vladimir Putin invaded Ukraine in 2022. The following years of grinding trench warfare created a bottomless appetite for munitions that the United States was suddenly giving or selling by the thousands to its allies. America expended vast reserves of everything from Howitzer shells to advanced missile systems, first in Ukraine and then in Israel after the Hamas attack of 2023.
These conflicts were marked departures from the War on Terror, when the United States was mostly conducting anti-insurgency operations in the developing world. Putin’s invasion marked the first conflict with a “near peer” nation, meaning an industrialized country with deep reserves of industrial capacity. Tensions had also already been rising with another near peer country, China, which fueled worries of future munitions shortfalls. This means that Lockheed and its peers had to focus on producing more missiles at a faster rate than it did during the War on Terror.
The companies, and the Pentagon, did not seem up to the task. Spending constraints since 2011, triggered by debate over the debt limit, have led Congress to issue budgets largely through annual continuing resolutions, which undercuts efforts to begin multi-year commitments and contracts necessary that would allow companies like Lockheed to boost missile production. The current wait time for a new Hellfire missile is between two and three years from the time it’s ordered, according to the Department of Defense. The wait for a Javelin missile is about three years.
All of this has saddled Lockheed Martin and other companies with two mandates that are in opposition: If it wanted to dramatically increase its missile output and speed up deliveries, the company would need to invest billions of dollars to boost supply chains and hire workers. But this would cut into free cash flow and could hurt its profits, making the company less attractive to investors. The company might be incentivized to boost production if the Pentagon paid all the upfront costs for expansion. But the Pentagon has not done that, nor has it resorted to using more radical measures like forcing increased production through authorities like the Defense Production Act. This has left companies like Lockheed to work with what they have, trying to satisfy both the Pentagon and its investors at the same time.
The tensions were on stark display in 2023. That year was a good one for Lockheed — the company earned $6.9 billion in profit, up 21 percent from the year before. It also had $6.2 billion in free cash flow, meaning the cash it had available after covering costs for operations and capital investment. The company was in a flush position.
But Lockheed also needed to keep its investors happy. The company’s stock price had been lagging in recent years in large part due to chronic delays on F-35 deliveries, which has suffered from software problems. Boosting dividends and buybacks was an easy way to entice investors. In 2023, Lockheed gave $9.2 billion directly to its shareholders, spending $4 billion to buy back shares of its own stock, and then distributing more than $5 billion in the form of direct cash dividend payments. By contrast, Lockheed spent $3 billion that year on research and capital investment. At the same time, Lockheed sought to trim its operations further to boost its profit margins. The company announced it would cut 1 percent of its workforce during 2024 through hiring freezes and voluntary separations. It implemented a new cost-cutting program called “1LMX” to streamline operations and factory production. In Orlando, factory workers like Spence and Masters said they were repeatedly asked to make their operations more “lean,” which often meant taking on more responsibilities and tasks, along with doing smaller things like keeping tools closer at hand or using special plastic trays where spare parts were grouped in clusters for quicker access.
During a public conference call with investors in early 2024, a stock analyst pointed out that even in the face of these improvements, Lockheed’s profit margins were lower than they had been a decade earlier, during the War on Terror. The Missiles and Fire Control division, which includes the Orlando factory, enjoyed profit margins of 18 percent 10 years ago, the analyst pointed out, but profitability had fallen across most of Lockheed’s divisions by about 2 percent by 2023. This happened in part because the Pentagon was trying to keep overall prices low and limit how much it paid to contractors, forcing Lockheed to keep its own costs low in response, even as production costs were rising.
Lockheed’s CEO, Jim Taiclet, said the company was aware of the problem, and would take action.
“We are taking the shareholders’ interest into account and all the things we talked about, which should help improve our margins,” Taiclet said, adding: “Even though it may result in some difficult discussions with some of the customer base.”
The customer base, of course, was the Department of Defense and foreign governments who were frantically asking for more missiles produced on a faster timeline. These needs needed to be met, but so too did the shareholders’.
The shareholders did well. During 2024, Lockheed gave another $6.8 billion back to them in the form of stock buybacks and dividends.
About a year after that call, in May of 2025, the company’s labor relations team sat down in Orlando to negotiate a new five-year contract for workers. Cherrie Bowen, the local union chairwoman, said her negotiating team asked for a raise of 18 percent during the first year of the contract, helping compensate employees for the previous years of high inflation. Lockheed countered with a raise between 3 and 4 percent, she said. The union came back with an offer of 12 percent but made no headway. Bowen and her team presented this offer to their members, and the members voted to go on strike.
Three weeks later, just before Memorial Day weekend, Lockheed agreed to negotiate again. The company said it wanted to meet at a hotel in Phoenix, Arizona, so it could negotiate in tandem with the Orlando union and their counterparts in the Denver local.
Bowen was shocked by the proceedings. She had believed that Lockheed might have been chastened by the strike, and hurt by a slowdown in production. But the company’s offers were essentially unchanged.
Bowen believed that the company was stalling, and she was worried that it would work. The union held down defections over the previous week, but Bowen was worried more people would fold if she came back to Orlando with nothing, perhaps enough to have the local Orlando union chapter decertified. Bowen and her team decided to present Lockheed’s newest offer to its members. The new offer would bump up the minimum wage at the factory from $15.45 to $20 an hour and the top wage from $36.28 to $41.75 an hour, giving everyone a quick raise, if not as much as they’d hoped for. Annual raises were included for each year, beginning with 4 percent the first year, then 3.5 percent the next two years and finally 3 percent for the final year. A company summary of the offer said it would boost total compensation by 41 percent over five years, when all wages and benefits were accounted for.
There was dismay along the picket line when news of the new offer was made public. The terms were substantially similar to the one they’d already rejected. Three weeks of fighting seemed to have won them only a few feet of territory. The raises were similar to what they had at that time — between 3 and 4 percent a year, rather than the 12-to-18 percent first-year increase the union had asked for.
A vote on the contract was set for Friday, May 30.
As the union debated, another labor union claimed victory in their own dispute. The 3,000 workers at Pratt & Whitney in Connecticut voted to accept a new contract from the company after three weeks on the picket line. That union, called the International Association of Machinists and Aerospace Workers, or IAM, achieved some major victories during its walkout. The union won a 6 percent raise in the first year of the contract from their current rate, and it won important job-security promises to stop Pratt & Whitney from shifting jobs to new factories in right-to-work states. This was read as an encouraging sign for other labor organizers.
On May 30, the union in Orlando voted to reject Lockheed’s proposal by a margin of 144 to 99, according to a vote tally shared by an employee. But that wasn’t the end of the matter. Orlando’s vote was tallied along with the union in Denver. When that union’s votes were tallied, the total included enough “yes” votes to ratify the contract. Orlando had been outvoted.
The picket line was taken down over the weekend, and workers were told to return to the factory the following Monday.
The alarm bells are ringing.
In April, the prestigious policy journal Foreign Affairs published a clarion call, highlighting the shortfalls in America’s missile supply chain, of which Lockheed Martin’s Orlando factory is a key component. “The American military suffers from munitions shortages across almost every weapons category,” wrote Michael Brown, the former director of the Pentagon’s Defense Innovation Unit.
Also in April, an Army Lt. Colonel named Sandra Thomas published an essay in the magazine National Defense, urging lawmakers to pass sweeping reforms that might invigorate America’s military-industrial complex and restore its capacity to meet the Pentagon’s needs. She said the current defense industry — the largest and most expensive in American history — is now “too small to surge,” leaving U.S. armed forces and allies short of the materiel they need. It’s a startling statement considering that the five top U.S. defense companies reported a combined $216.7 billion in revenue in 2024, according to the trade magazine DefenseNews.
Thomas was the division chief of a team at the Joint Chiefs of Staff office that studied the defense industrial base and its potential to mobilize more production. She has a background in logistics, and spent much of her time wading through reports and data collected by other staffers and outside think tanks, including surveys of military branches and defense contractors. The findings were sobering. One major survey showed that even the biggest defense companies could not significantly increase production of certain munitions unless they were given, in some cases, billions of dollars and several years to complete the task. The manufacturing base had stripped down to the point that it was running full tilt, meeting most of the Pentagon’s current needs but with no room to grow.
“They were just comfortable,” Thomas said of many big defense contractors. She stressed that she was sharing her personal opinion, and not that of the Joint Chief’s office. But Thomas felt that when the government potentially needed more output from the prime contractors, those companies seemed risk averse to making the investment. “That hurts their bottom line,” she said.
A lack of skilled employees is one of the most important barriers to the industry’s expansion. In mid-January, just before Trump’s inauguration, the Joe Biden administration released a 59-page strategy aimed at reshaping the defense industry to prepare it for a new era of higher production. The strategy had four pillars. It sought to expand the defense supply chain while making it more resilient, reform the Pentagon’s acquisition process and write new trade deals that could stimulate the U.S. defense industrial base.
The fourth pillar was developing a workforce that could actually build the weapons. The strategy report stated the problem bluntly: “The labor market lacks sufficient workers with the right skills to meet domestic production and sustainment demand.” To solve for this problem, the strategy focused on ways to expand the pipeline of trained employees who could apply for jobs at places like Lockheed’s Orlando factory. It recommended investments in job training programs and apprenticeships, along with a $300 million program to connect defense contractors to community training programs that focused on science and manufacturing skills.
While this might increase the number of capable employees in the defense sector, the strategy had very little to say about what might happen to them after they were hired. There was no mention of organized labor, worker pay, benefits, working conditions or other factors that might keep young people in these jobs once they attain them. There was also no mention of the powerful incentives on Wall Street that might dissuade companies from extra hiring, on-the-job-training or major wage increases to attract manufacturing talent.
On June 2, just a month after the strike began, the employees at Lockheed Martin returned to their stations inside the missile factory. Gideon Spence, the machinist, said that many of his tools were in disarray and his machine had been poorly maintained. He suspected that a manager or engineer had been running it with little training. It took him a few days to get everything back in order. He had very little to show, economically speaking, for the weeks he had spent on the picket line. He would get a small raise and a $3,000 “signing” bonus for ratifying the contract, but he and other employees felt like they were returning to work almost back where they had started.
“Honestly, a lot of us feel like it was kind of a defeat,” he said.
Saroj Mayes, a Lockheed employee who assembles circuit boards and single mother living in an extended stay hotel in Orlando, said that her first two weeks back at work were unusually hectic. While Lockheed claimed that production was virtually unhindered by the strike, it appeared to her that there was a large backlog of work to catch up on. She works on a special component for a weapons system (many employees are hesitant to get too specific about their jobs, citing national security concerns). Usually she is asked to complete 20 pieces in a week; on her second week back she was asked to complete 100 pieces. Like Spence, she didn’t gain much ground thanks to the strike. She said her pay was increased from $18.06 to $20. She was wondering if it might be enough to put her over the top in her effort to rent an apartment. She was going to keep trying.
“Supposedly, by the end of this year I’ll be making close to $23 an hour. So with that, I should be able to afford something and be OK. But we’ll see,” she said. “Maybe next year.”
Randy Tejada, the Army veteran, said that his assembly station was in good shape upon his return, other than a few expensive tools that had been broken. He said he had been prepared to stay on the picket line for six months, the amount of time he believed it would take to wring true concessions out of Lockheed. But he had been outvoted. When Tejada joined Lockheed, he was attracted to the idea of building a career there. But now he thinks his talents might be more valued elsewhere. He would consider a transfer within Lockheed, but was also thinking about getting a job from a different company, maybe outside the defense sector.
“I’m definitely looking for other options,” he said, “since I see this company doesn’t take people that serious.”
