It's not all bad news when it comes to the health of the U.S. space industrial base.

• Author: Magnuson, Stew
• Position: Space

EL SEGUNDO, Calif.--Craig Cooning, vice president and general manager of Boeing space and intelligence systems, showed off the factory where some of the nation's most secretive spy satellites are built.

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The facility, which began its life as a car factory, then an aircraft plant for legendary aviation pioneer Howard Hughes, now produces satellites for a variety of customers.

Its enormous equipment is designed to replicate the harsh space environment. Giant shake tables and sonic blasters ensure spacecraft can survive the rigors of being launched. A massive thermal vacuum chamber subjects them to temperatures ranging from plus or minus 125 degrees Celsius.

The facility employs about 5,500 workers.

Traveling northeast about 100 miles, at the Mojave Air and Space Port, Roderick and Randa Milliron are developing a multistage rocket called the Neptune that they believe will take micro-satellites that weigh about 1.65 pounds into orbit. They are working in a "temporary" building constructed by the Marine Corps' aviation branch during World War II. Their company, Interorbital Systems, has five full-time employees, plus a roster of other experts they call in when needed.

"It's really like an old style rocket team rather than a top heavy contractor," said Roderick Miliron, co-founder and chief engineer, and a former aerospace worker at a major defense company.

The two companies couldn't be more different other than the fact that they are both part of the nation's space industrial base.

The health and welfare of the companies that produce spacecraft, payloads, rockets and ground stations for everyone from NASA to intelligence agencies has been the source of much hand-wringing during the past few years. The general consensus is that the space industrial base is in a state of decline.

There are many causes for alarm, several reports have noted. Baby boomer generation engineers who pioneered the field during the 1960s space race and subsequent Cold War are retiring, and few technical experts are in the wings to replace them. Strict trade controls on commercial satellites imposed in the late 1990s resulted in business being lost to foreign companies. NASA can no longer be counted on to keep legions of engineers, middle managers and technicians employed. The space shuttle is retiring, which will result in hundreds of layoffs, and pundits complain that the agency has no direction.

Yet Cooning said the Boeing facility in 2010 had a banner year. Commercial, civilian, and spy satellites have kept the factory humming. But he worries about what comes next.

"On one hand, I can say, 'yeah, we look okay,' But on the other hand, I'm concerned about what we can do in the future."

With contracts for GPS, NASA, commercial communication satellites--and a few other classified programs he can't talk about--there are no problems keeping the production workers occupied. That's not the case for the highly specialized engineers tasked with creating the next-generation of spacecraft.

"If you look at the size of the business, I have people involved in the developmental business right now, but I don't have a lot of developmental business walking through the door," Cooning said.

He once employed 40 engineers who specialized in designing digital satellites. He's now down to five.

Addressing the perceived woes of the industry was one of three strategic objectives spelled out in the recently released Defense Department National Security Space Strategy.

The goal of the department will be to "energize...