Southern California defense contracting sees massive growth

Military contracting is experiencing significant growth in Southern California. An analysis by CalMatters and The Markup reveals that the total value of defense contracts won by companies in Los Angeles County has more than doubled over the last decade when adjusted for inflation.

While much of the $15 billion in contracts awarded in L.A. County last year went to established defense contractors like Boeing, there is a notable shift toward startups. These newer companies are increasingly securing contracts for advanced technologies, including drones, low-cost missiles, surveillance satellites, and artificial intelligence tools. In 2025, ten startups in the Los Angeles area reached “unicorn” status, with most operating in the aerospace or defense sectors.

This expansion is being fueled by a surge in venture capital and private investment. The shift toward specialized technology is evident in California's contract distribution; the share of the top 100 defense contracts focused on drones or space rose from 14% in 2015 to 21% by 2025.