What will it take to bring back US naval production?

Years of budget shortfalls led to a decline in Navy force levels from a Reagan-era peak of 597 warships in 1987, to 293 battle force ships as of October 1 2025.

The fiscal 2026 budget plan for 19 new ships marked a serious reversal of that trend. The new fiscal 2027 budget adds 18 battle force ships and 16 non-battle force ships. The $66 billion shipbuilding and construction budget request is the highest since 1962. It represents a major attempt to yield a larger fleet which, as a result, will not suffer from the strain of long deployments that has become far too common today.

Despite the massive injection of funds into desperately needed ship construction, it is not at all clear that there will be a commensurate increase in the shipbuilding workforce to ensure that ships will be delivered on time. The U.S. Navy’s relatively small number of private and public shipyards have long suffered from a shortfall in skilled workers, notably electricians, fitters and welders.

As a February 2025 Government Accountability Office report stated, “All seven shipbuilders face workforce limitations — such as problems with recruitment, retention, or skill level — that affect their ability to meet the Navy’s new ship delivery goals. … The skilled workforce in the U.S. — such as for welding and electrical work — is aging and retiring, and fewer new workers are learning these skills to replace retiring workers.”

The report added that “the majority of shipbuilders  [will] need to hire thousands of skilled employees in the coming years, which will increase the number of inexperienced staff [and] will result in a smaller proportion of experienced skilled employees … it takes between three and five years for an employee to gain proficiency in the skilled trades. This will likely result in reduced shipyard efficiency in the near term.”

The Government Accountability Office released its report months before Congress approved the fiscal year 2026 Navy budget that funded more than three times as many ships as it had in the previous year. That increase, and the proposed increase in the fiscal year 2027 budget, will only aggravate the shortfall in skilled workers that the shipyards will confront. Indeed, Matt Evans, of the Navy’s new maritime industrial base program office estimates that the shipbuilding base will need about 25,000 new workers for each of the next 10 years to meet the Navy’s needs.

Pay is the main reason workers are reluctant to take shipyard jobs. Even increases in workers’ pay may not be enough to enable shipyards to eliminate the shortfall in worker availability, however. In particular, the seemingly insatiable demand for data centers to power the explosive growth of artificial intelligence will result in an estimated requirement for more than a half million electricians as well as plumbers and other tradespeople. Salaries can exceed six figures for newly trained workers, while the working environment is less harsh than at shipyards.

Companies and universities are investing considerable sums to train workers. For example, Black Rock is investing $100 million to train plumbers, electricians, air technicians and ironworkers. Baton Rouge Community College, in partnership with ExxonMobil have been providing no-cost training for electrical workers, pipefitters and welders since 2012.

Moreover, the April 2025 Executive Order for “Preparing Americans for High-Paying Skilled Trade Jobs of the Future“ should be a major stimulus for efforts to meet the demand for skilled trade workers. Nevertheless, there may not be a sufficiently large enough workforce to support both the civilian sector — especially the expanding artificial intelligence industry — and the Navy’s shipyards.

One possible solution suggested in a recent Center for Maritime Strategy study, would be to draw on allied shipbuilding expertise. The study points out, “America’s seafaring allies serv[e] as a source of best practices and lessons learned which can inform efforts to restore American seapower.”  Hanwha’s investment in the Philadelphia shipyard offers a powerful example. The shipyard workforce has increased to 2,000 workers as of March, and 150 new apprentices are currently being trained.

The Navy cannot continue to oversee a program that is chronically overbudget and behind schedule due largely to the inability of shipyards to retain and attract the workforce they need.

Once the full fiscal 2027 budget is released, it should include major funds for supporting training programs specifically designed and dedicated to meeting the needs of the shipyards. It should also call for more cooperation with foreign shipbuilders.

Only then will there be some reasonable assurance that last year’s shipbuilding budget increase and this year’s budget request will result in the timely and efficient delivery of ships to meet the Navy’s desperate need to support its many extended deployments across the world’s oceans.

Dov S. Zakheim is a senior adviser at the Center for Strategic and International Studies and vice chairman of the board for the Foreign Policy Research Institute. He was undersecretary of Defense (comptroller) and chief financial officer for the Department of Defense from 2001 to 2004 and a deputy undersecretary of Defense from 1985 to 1987.

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