Close observers of the US Navy were befuddled when, on March 11, the service released its budget proposal for 2025.
The $258-billion budget ask includes $26 billion for six new front-line warships: a Virginia-class attack submarine, two Arleigh Burke-class destroyers, one Constellation-class guided-missile frigate, one San Antonio-class amphibious transport dock and one medium landing ship.
The $26 billion also includes partial funding for a pair of Gerald R Ford-class aircraft carriers and a Columbia-class ballistic-missile submarine.
For any other navy, $26 billion and six powerful new ships would be an unprecedented windfall. But for the US Navy – by the measures that count, the world’s most powerful fleet – it represents a profound shipbuilding collapse. The US fleet has been trying to grow from today’s 293 warships to 350. Since most ships last just 30 years or so, the Navy must buy a dozen new ones every year, on average, to grow to 350 hulls and stay there. It needs ten a year, roughly, just to stay the size it is.
The 2025 budget would buy just half the requirement. And now we know why. Put simply, the US naval shipbuilding industry is so short of skilled workers that it can barely build the ships it already has under contract – never mind adding ships to the backlog.
That’s the startling conclusion of an intensive shipyard review that US Secretary of the Navy Carlos Del Toro ordered back in January. The US defence press got ahold of the review’s findings on Tuesday – and the Navy promptly confirmed the details.
The industry’s seven major shipyards – Bath Iron Works in Maine, Electric Boat in Connecticut, Newport News in Virginia, Austal in Alabama, Huntington Ingalls in Mississippi, Fincantieri in Wisconsin and NASSCO in California – are years behind schedule on major shipbuilding programs.
The main problem is people. The yards are losing skilled workers faster than they can hire them. And the Navy itself is struggling to staff its design bureau, which feeds blueprints to the yards. The shipbuilding workforce is heading “in the negative direction in multiple regions,” Nickolas Guertin, the Navy’s top shipbuilding official, told reporters.
The chaos inflicted on the industry by the Covid response is the main reason for the manpower crisis, Guertin said. The rate of loss of skilled workers – a function of shipwrights quitting or retiring while too few newly trained shipwrights replace them – has “doubled from where it was at the beginning of the pandemic,” according to Guertin. “In other cases, it’s more than that.”
But Covid can’t be the only reason the yards are losing people. It’s worth noting that unemployment in the United States is extremely low: just 3.9 percent as of February. The US economy is thriving, and lots of industries – not just naval shipbuilding – are desperate to hire.
With too few workers, the yards are falling behind schedule on the 88 ships that the Navy has ordered in recent years – and is still waiting for the yards to complete.
Delivery of the first Constellation-class frigate – under construction by Fincantieri – has slipped from 2026 to 2029. The first Columbia-class submarine, built by Electric Boat and Newport News, has slipped from 2027 to 2028 or even 2029. Two batches of new Virginia-class subs, also from Electric Boat and Newport News, are up to three years later. The next Ford-class carrier from Newport News is two years late.
With so many shipbuilding efforts falling behind as the shipbuilding workforce shrinks, it’s no wonder the Navy is reluctant to pile more new contracts onto the struggling industry. What good is it to order a new warship if no one can actually build it?
It’s also no wonder that the Navy is eager to spend so much of its 2025 budget rebuilding the industrial base and shoring up the workforce. The budget ask includes a $7-billion investment “in the health and supply chain of the industrial base,” according to the Navy. More than half of that is going to the two yards that build submarines.
The Navy seems to appreciate that it needs to solve its industrial problems now in order to grow later. Fleet planners are projecting a sharp increase in ship orders in the coming years: 11 in 2026, 14 in 2027 and 13 each for the next three years.
In that context, 2025 represents a shipbuilding pause, during which the Navy orders fewer ships in order to spend more on fixing the supporting industry – so that the industry can handle the huge amount of work that could be coming its way starting in 2026.
If the industrial revamp fails, and the shipyards can’t hire more workers than they lose, the long-term impact on US naval readiness could be extremely serious. The American fleet is already smaller than the Chinese fleet in terms of hulls.
Chinese warships do tend to be much smaller and less heavily-armed than American ones. The United States on average builds fewer but more powerful ships than China builds. But every year that American industry struggles to complete any warships on time is another year for Chinese industry to close the tonnage and firepower gap.
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