The hardest part of running a defense and aerospace contractor is rarely winning the work. For Margarita Howard, the founder and chief executive of HX5, the binding constraint sits one step earlier, in the supply of people allowed to perform it.
HX5 supports Department of Defense and NASA in research and development, engineering, information technology, and mission operations. Almost none of that work can be done by someone without a security clearance, and the pool of cleared, technically qualified professionals has never been deep enough to satisfy demand.
Now the rules governing how those people are vetted, and how quickly they can move from one employer to another, are being rewritten at the same time the shortage is tightening. A governmentwide overhaul of personnel vetting is roughly two years into a multiyear rollout. For a mid-tier prime such as HX5, that changes the nature of the problem. The question has become both how to locate cleared engineers and how to assemble a workforce that keeps moving while the machinery underneath it is being rebuilt.
Rebuilding the Vetting System Is Being Rebuilt
The reform program, known as Trusted Workforce 2.0, was set in motion when the Office of Personnel Management and the Office of the Director of National Intelligence finalized its core policies in July 2024. Its central move is to replace the old rhythm of periodic reinvestigations, conducted roughly every five years, with continuous vetting: ongoing automated checks against public and government records that flag concerns as they arise rather than on a fixed calendar.
The Defense Counterintelligence and Security Agency has now enrolled more than 3.7 million clearance holders in continuous vetting, effectively the entire national security population.
A second change matters more for how staff move between jobs. Agencies are now expected to honor existing favorable adjudications through reciprocity, and to complete qualifying transfers in as little as three days, so a cleared professional changing employers doesn’t restart the investigation from zero. In principle, that should make cleared talent more fluid across the industry.
In practice, the transition is uneven. A Government Accountability Office review released in May 2025 surveyed 45 federal agencies and 626 contractors on their experience with the new system. Among contractors, an estimated 45% said the reforms had not changed their ability to manage risk when onboarding new personnel, while about 22% reported an improvement. Roughly 98% of agencies said adapting their vetting technology to the new requirements had been at least somewhat difficult. The reforms promise faster movement, but the day-to-day reality is still catching up.
HX5’s Pipeline
Margarita Howard’s recruiting model at HX5 concentrates on the two channels where the required traits, an active clearance and genuine familiarity with government programs, already tend to overlap.
The first is veterans, who make up more than 30% of the HX5 workforce. Many arrive already holding clearances and already fluent in how defense and space agencies operate, which compresses the time between hiring and contribution. HX5 has participated in the Defense Department’s SkillBridge program and the Hiring Our Heroes Corporate Fellowship since 2021, and it received the 2025 HIRE Vets Gold Medallion from the Department of Labor.
The second channel runs through universities, and it operates on a longer clock. “One of our most valuable partnerships has been with academic institutions,” Howard says. “Collaborating with the universities on research initiatives has helped us stay ahead of emerging technologies, and also can help foster a pipeline of talented graduates that may come to work for us or contribute on a short-term basis.”
A graduate student working alongside a defense agency accumulates government-adjacent experience before entering the job market, which means clearance eligibility can begin to take shape years before a first paycheck.
Geography follows the same logic. Where HX5 establishes a presence is driven partly by proximity to the agencies it serves and partly by where the right people already are. “We look for talent access,” Howard says. “Where we can find top-tier talent is a big driving force. Some regions have specialized expertise that aligns very well with our projects.”
Sequencing the Work Around the Wait
The defining operational challenge is timing. Even a strong candidate can’t begin cleared work until their clearance comes through, a process driven largely by the background investigation, which still routinely runs for months. A firm that staffs only to its current headcount stalls the moment a program ramps up, because the people it needs are sitting in a queue.
The standard response among contractors like HX5 is to treat the wait as something to be managed rather than endured: bringing qualified people in earlier, assigning them to unclassified preparatory work, and studying program requirements in detail before the clearance is granted.
Howard describes the same discipline she applies when HX5 enters an unfamiliar program area. “We always study the requirements first and foremost, and discuss them with the leadership team,” she says. When the work demands expertise the company does not yet have, the answer is deliberate rather than improvised: “We really had to lean heavily on subject matter experts, find them, and hire them, and rely on their expertise and knowledge.” Sequencing work so that teams can absorb adjudication timelines, rather than being blocked by them, is what lets a mid-tier prime hold a contract steady through the gap.
Policy is moving in the same direction. The House version of the fiscal 2026 defense authorization bill would let companies build a deeper bench of staff to work on classified programs while those employees move through the clearance process, an acknowledgment in law of the workaround contractors have already been forced to engineer. The Senate version, separately, would extend how long a departing service member or Defense Department employee remains eligible for classified work, lengthening the window in which already-vetted talent stays usable.
Keeping the People You Clear
Reciprocity cuts both ways. The same rules meant to let firms like HX5 hire a cleared engineer more quickly also make HX5’s own cleared engineers easier for others to recruit. That turns retention into the second half of the strategy. A cleared professional with a decade of program history is an asset the open market can’t quickly replace, and holding onto that person is its own form of capacity.
Howard attributes the company’s low turnover to deliberate choices about management and knowledge.
“We have our mentorship programs where senior employees mentor newer hires, ensuring that knowledge transfers happen quickly and consistently from within,” she says.
That kind of pairing can both move hard-won institutional understanding from veterans of a program to its newer members, and give those newer members a reason to stay.
What HX5 cannot match on every front is commercial compensation, and Howard doesn’t pretend otherwise. Her recruiting argument rests on the nature of the work. “You have to get up in the morning and be excited about the particular program you’re supporting,” she says. “Let’s get to the moon, let’s accomplish this mission overseas.”
The pitch seems to be landing: many HX5 employees have stayed with the company for more than a decade, Howard says, unusual in a sector where contract turnover routinely scatters staff.
The number of cleared, credentialed professionals is not growing fast enough to meet sustained demand, and the vetting reforms now underway will take years to deliver their full promise. HX5’s approach treats a cleared workforce as something built and held over years rather than acquired the moment a contract is won. Veterans and university partnerships supply the front of that pipeline, disciplined sequencing carries the middle, and retention holds the back.