From Shipyards Comes Seapower: Revitalizing Naval Shipbuilding
Introduction
Since the fall of the Iron Curtain, the U.S. Navy’s acquisition of new ships maintains a troubling pattern. Reforms based upon accountability, design before production, and a reformation of the naval shipyard workforce will lay the groundwork for a resurgence in naval shipbuilding. The Zumwalt class destroyers, designed to fulfill the concept of the 21st Century Destroyer, were truncated after per ship costs increased by more than 80 percent over initial projections. The Italian FREMM Constellation-class frigate has suffered delays and cost growth due to U.S. Navy design requirements, raising concerns that it may resemble previous acquisition failures. The FFG(X) program may also rely on legacy U.S. Coast Guard cutters for certain missions. However, these vessels cannot mount vertical launch system (VLS) cells, limiting their air-defense and strike capabilities.
The History of American Shipbuilding Struggles
Brian Potter’s analysis in “Why Can’t the U.S. Build Ships?” outlines the historical struggles of American shipbuilding, which is crucial in understanding how historical trends paved the way for current issues. The start of World War I revealed an ugly truth to the American shipping industry. The reliance on foreign ships for international trade quickly faded away when hostilities opened, as foreign nations recalled and requisitioned their own ships for their war efforts. The Shipping Act of 1916 birthed the U.S. Merchant Marine Fleet, resulting in the U.S. accounting for around 20% of all the world’s shipping after the end of the Great War. The arrival of the Great Depression forced many shipyards to close, crippling the ability to produce ships prior to the start of World War II. The outbreak of the war was essentially a repeat of the Great War, with the U.S. once again hard-pressed to revive a shipbuilding industry for a total war. The construction of over 2,700 liberty ships was a testament to the quickness and scale at which America amassed ships during the conflict, and by the war’s conclusion, America possessed nearly 60% of total tonnage in the entire world.
American shipbuilding dithered for decades during the Cold War. Japan overtook both the United States and Britain as the largest shipbuilding industry in the world, and infrastructure developments through highway systems and railroads continued to eat away at the efficiency of commercial shipping within domestic movements. The Oil Crisis in the 1970s dried up demand for new ships that were built through the Merchant Marine Act of 1970. The Act brought in money to modernize shipyards as well as multiple Japanese shipbuilding firms to bring training and techniques to American companies. However, American companies had extreme difficulty adopting the Japanese practices, and efficiency was not at the levels that Japanese advisors expected it to be.
In the modern day, shipbuilding is defined by two circumstances: high cost of labor and steel as compared to foreign countries, and a production culture optimized for low-volume construction rather than serial efficiency. Compared to countries like Korea or Japan, American labor costs and steel costs are extremely high (approximately four to six times greater than Asian industries), making American shipbuilding industries extremely unattractive due to higher costs for production. Due to this, the U.S. accounts for only 0.1% of global commercial shipping tonnage today. In regards to culture, a single crucial factor reinforces the stagnation in American shipbuilding. The Jones Act insulates U.S. shipbuilders from foreign competition, ensuring only American vessels are used for domestic shipping. This in turn ensures American shipbuilding does not constantly evolve in order to deal with international competition, as the commercial base is shielded from foreign competition through the act.
Current Issues With U.S. Navy Shipbuilding
With a clear explanation of the historic struggles of commercial and naval shipbuilding, a groundwork of the current issues facing U.S. Navy ship programs can be explained in depth. A glaring fault is a systemic breakdown in the acquisitions process of shipbuilding. Over the past three decades, designs have been implemented before they had matured, constantly shifting requirements were seen as the norm, and in-production changes drove up costs. The Government Accountability Office (GAO) reviews prove that major ships enter the construction phase without achieving stable and complete functional design prior, a practice inconsistent with shipbuilding standards.
In 2025, the GAO released a report with concern regarding the Constellation-class frigate, “In May 2024, we found that the Navy and the shipbuilder for the Constellation-class frigate program were struggling to stabilize the ship design and, consequently, ship construction had effectively stalled. These problems contributed to an estimated delay of 3 years…expecting to exceed the contract ceiling price.” The delay of the FREMM frigates has been exacerbated due to U.S. Navy specific design requirements, making procurement exponentially more expensive and slower.
The GAO also reports that, “In October 2024, the Navy reported 759 metric tons of weight growth from initial estimates—nearly a 13 percent increase—due in part to the underestimation of applying Navy technical requirements to a foreign ship design.” The exposure of the issues plaguing the construction of the Constellation-class highlight the vicious cycle of acquisitions: unexpected cost growth, delivery delays measured in years due to design changes, and platforms delivered late and under planned build numbers. These overruns persist despite budgets, indicating that increased funding has not led to increased capability. The Navy has placed itself in a position where ships are built like prototypes, and not as part of a stabilized line of production.
Role of the Jones Act in Naval Shipbuilding
The Jones Act has zero impact on U.S. Navy shipbuilding, but it plays an indirect role in regards to the decline of naval shipbuilding. Commercial shipbuilding is not inclined to develop export competitiveness and block production practices, as they are shielded from foreign competition. Since a majority of these shipping companies are also contracted to produce naval shipping, these gaps transfer when building navy ships. Korea and Japan have proved that to build warships efficiently, a country has to build commercial ships efficiently first. Another critical issue of American shipbuilding culture that specifically affects U.S. warship production is the low production numbers. Navy shipyards that build destroyers can typically be contracted to complete 1-2 ships per year, and coupled with frequent design modifications, peak efficiency is rarely achieved by the shipyard. Compared to Japan or Korea, where shipyards rely on block production of standardized hulls, efficiency can be achieved due to the absence of modifications. U.S. shipbuilding emphasizes single designs with limited acceptability for error, while Asian shipyards prioritize standardized production that favors speed, cost control, and replaceability. Repeal of the Jones Act would force the industries to scale production to become competitive internationally, indirectly improving naval shipbuilding. Colion Grabow in War on the Rocks describes how the Jones Act unintentionally affects national security, “Perhaps more important than this relative disparity is the country’s inability to build new Navy ships and maintain existing ones. Decades of uncompetitive shipbuilding have degraded the industrial base to the point where there isn’t sufficient shipyard capacity to meet U.S. national security needs.”
Reversing decades of failure in shipbuilding requires more than process reform or increased funding.
The following three pillars outline a reasonable plan: enforce accountability, design before construction, and a domestic workforce.
Pillar 1: Accountability
The most pervasive issue facing naval acquisitions is the absence of accountability when programs predictably fail. Over the last 20 years, the shipbuilding budget has doubled in size, but the production and efficiency of shipbuilding have not matched a vastly increased budget. However, in FY2023, the Navy delivered only 7 of 13 ships required to maintain its annual requirement as dictated by planned force structure objectives. The Government Accountability Office (GAO) analyses attribute this failure to cost overruns, changes in design during building phases, and immature program baselines.
Addressing accountability in shipbuilding requires structural reforms that directly align outcomes of production to leadership authorities. Senior acquisition officials must be required to personally certify designs, cost projections, and requirement stability, with such certifications carrying profound legal significance. By linking these approvals to program performance, the acquisition system would introduce meaningful career consequences for knowingly approving unrealistic plans. In addition, cost and schedule overruns should automatically trigger an independent investigation through an Inspector General, placing a greater emphasis on the importance of accurately reporting changes in a program throughout its cycle. It is crucial to ensure that accountability enforcement can delineate between unintentional friction and deliberate fraud or waste.
Pillar 2: Design Before Construction
The second pillar of reformation is the enforcement of a design-complete policy. U.S. naval ship programs routinely begin construction with unstable designs, guaranteeing costly rework and delays. Commercial shipbuilders and successful foreign naval producers treat design maturity as a prerequisite for ship production. Instituting a requirement for a complete certification of a design prior to steel being cut would save the American taxpayer remarkable amounts of money.
This concept would require a deliberate separation of prototype from production in navy shipbuilding practices. The GAO states, “Attaining design stability helps assure that a product will meet cost and schedule targets, and programs that entered construction without stable designs did experience cost growth.” Once a design for a ship is frozen, production must start without significant changes to the original plan. As shown by numerous GAO reports, modifications during construction have driven up costs and delayed delivery of lines. Waivers to modify during production should be a rare occurrence, independently reviewed, and carry career consequences for approving officials, which will enforce personal accountability. Without strict design control, no workforce or funding on this planet can overcome the pains of design modifications during production.
Pillar 3: National Shipbuilding Corps
The third pillar is a revitalization of the domestic shipyard workforce. A GAO report regarding domestic shipyards states, “The Navy’s shipbuilding plans have consistently reflected a larger increase in the fleet than the industrial base has achieved…The shipbuilders have infrastructure and workforce challenges that have made the Navy’s goals difficult to accomplish.” This is largely what resulted in the Navy delivering only 7 of 13 vessels in FY 2023, leaving the force under operational capacity. CRS testimony also states, “Workforce challenges appear to be a central factor in projected delays and capacity constraints. These challenges include difficulties in recruiting and retaining sufficient numbers of production workers at shipyards and supplier firms…and limited numbers of ship designers.” The workforce present in the United States simply is not enough to keep up with the demands of naval shipbuilding, and civilian industries offer more lucrative opportunities for workers. America has suffered the loss of industry and jobs, crushing our ever-shrinking blue collar workforce for far too long. To revitalize our shipyards, our nation must incentivize work through career pipelines, recruitment drives, and educational programs.
The creation of a Naval Shipbuilding Corps that emulates the spirit of the Civilian Conservation Corps would provide a mechanism to grow the domestic shipbuilding workforce. The NSC would only recruit U.S. citizens, with its primary demographics as young adults and dispossessed workers, and place them into service contracts that come with the structure of paid employment, official trade training, and apprenticeships feeding directly into local shipyards. Workers would be pipelined into skills such as welding, electric work, quality checks, and naval architecture work as aligned with Navy certification benchmarks. Training pipelines would center around local community colleges, trade schools, maritime colleges, and union apprenticeships, ensuring that worker skills transfer seamlessly between civilian and government sectors.
NSC personnel would be allocated to shipyards facing the greatest workforce shortages. Federal funding would cover initial labor costs to reduce any risk for employers while onboarding the initial workforce. Unlike a majority of hiring, the NSC would have planned manpower flows that are directly related to Navy shipbuilding schedules. This empowers shipyards to scale production and personnel as needed. The NSC would include benefits such as wages matching commercial positions, making this employment competitive to civilian alternatives. Governance and maintenance of the NSC would be jointly led by both the Department of the Navy and the Department of Labor, ensuring that acquisitions and workforces are aligned under both “chains of command” needed to execute proper shipbuilding. By making a national workforce that feeds into shipyards, the NSC would dutifully address the labor issues identified by the GAO in numerous reports.
Conclusion
Naval power has always depended on the ability to build, outnumber, repair, and replace ships faster than one’s adversary.
The heart of the U.S. Navy’s power projection depends upon the ability to efficiently produce quality ships in order to align with the goals of the National Defense Strategy and fleet modernization goals. The historical trends of American shipbuilding show that despite periods of decline and struggle, our industry is able to be revitalized in times of conflict. Three crucial solutions that can improve shipbuilding are enforced accountability, complete designs prior to production, and the creation of a National Shipbuilding Corps. If the United States intends to deter conflict in the First Island Chain, shipbuilding must become a national effort, and not another GAO report that is disregarded months after its publication.
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