Crane well positioned to leverage opportunities from shifts in federal budgets
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Government spending is under the microscope, and there is no doubt the federal government is going through an evolution, the likes of which we haven’t seen in modern history. News on budget cuts and staffing changes are now commonplace in headlines across the nation and will continue to be for the foreseeable future. Yet, the outcome may be a net boost for the area workforce and economy.
For most of us the changes may not directly impact our day-to-day lives, but with the third largest naval installation employing 6,500 people in our back yard, we cannot escape the conversation. In the past few weeks, a federal mandate to reduce government workforce of nearly 730,000 resulted in voluntary separation of more than 300 personnel at Crane. In addition, a hiring freeze is now in place.
This is not the first time we’ve seen this headline at Crane or within the DoD. In fact, hiring freezes and early retirements are very routine for the federal government when spending cuts are mandated. These tactics have the least negative impact on current employees, and adjustments likely will be made both to the workloads of the remaining workers and subcontracting. DoD workers went through similar exercises in the 1990s because of the end of the Cold War and again around 2013 with the decline of fighting in the Global War on terrorism in Afghanistan and Iraq.
But the longer-term headline for Crane is different—the Missions at Crane are largely aligned with the current administration and Department of Defense top priorities. With the call for an 8% spending reduction across the DoD, there are 17 areas that have been identified as “protected” in the next few fiscal years –conservatively, over 70% of Crane’s workload maps to one of protected areas.
Those areas could even see increases in funding from budget savings in other areas, which vary across different budget models but are anticipated to be $50 – $70 billion for the DoD’s budget in the 2026 fiscal year. In April, the Trump administration announced its request for a $1 trillion defense budget, the largest in history, to rebuild and modernize the military. This bold request further solidifies the prioritization of DoD programs and their importance in the nation’s future.
Crane’s two largest commands, Crane Army Ammunition Activity and Naval Surface Warfare Center, Crane Division, both provide critical capabilities that are needed on that list of priorities. Their respective expertise will be an important fixture in the DoD’s new landscape.
From the list of 17 priorities Crane’s mission work is directly related to at least nine areas, some of which include Homeland Missile Defense, munitions, energetics, nuclear modernization, unmanned aerial systems and technology for Virginia-class submarines.
In theory, Crane could find itself next year with more work and fewer workers. Historically this has often triggered positive changes in the number of subcontracting opportunities for the private defense sector companies who support the DoD. Crane will likely investigate new methods of reallocating some of its mission workload to the many growing industry partners that surround the base.
Those industry partners are making their own headlines in and around the base including at WestGate@Crane Technology Park, home to more than 60 defense-related companies. New global companies, like NHanced Semiconductors, Kratos, Amentum, Reliable MicroSystems and CACI are setting up shop at WestGate and will bring millions in investment and hundreds of new, high-skilled jobs to the area. These new investments are a testament to the optimism felt toward Crane and the entire defense industry here in Indiana Uplands.
And the growth in the WestGate area is just beginning. The American Center for Manufacturing and Innovation (ACMI) recently announced 16 companies slated for its Munitions Campus, which is being built on a portion of ACMI’s National Security Industrial Hub (NSIH), a new 1,141-acre development adjacent to Crane and near WestGate in Bloomfield. These 16 companies such as Prometheus Energetics, Voyager Technologies and Kratos represent a wide range of advanced capabilities and specialties with defense applications including aerospace engineering, materials science, propellants, energetics, advanced manufacturing, uncrewed systems, artificial intelligence, and logistics. The construction and operation of the NSIH is expected to create thousands of high-quality private-sector jobs during the next five to 10 years and will stimulate an estimated $600 million in private investment—this strategic catalyst for innovation, resiliency and national security further reinforces the relevance and importance of the defense industry in the Uplands.
While none of us can predict exactly how government changes and global events will shape our country in the coming months and years, we can be confident in the tremendous importance of Crane and its impact on our region. Our focus should remain on the big picture impacts of the Defense work in our region as well as providing compassionate assistance to our colleagues who are being impacted by this evolution.