As the headquarters of another Fortune 500 company pulls up stakes to leave Los Angeles, some in the local business community are asking: Were those who are responsible for business outreach asleep at the wheel?

When Northrop Grumman Corp. announced Jan. 4 that it would plant its corporate flag in the Washington, D.C., area, it was a surprise to the Los Angeles County Economic Development Corp., the organization responsible for recruiting and retaining local companies. Officials with the city and the Los Angeles Area Chamber of Commerce also appear to have been taken aback by the announcement.

In a way, the announcement was not a surprise. There has been a trend of major aerospace and defense companies relocating to the Washington area in recent years, including Lockheed Martin Corp. and General Dynamics. Moreover, Northrop’s new chief executive, Wesley Bush, is from West Virginia, and it’s not unusual for a new CEO to move a company headquarters where he wants.

“We should never be surprised at something like this, and the reason we are surprised and the reason this happens is because we don’t really have a consistent outreach program for corporate America,” said Larry Kosmont, a local economic development consultant and the head of L.A.-based Kosmont Cos. “This is a structural failure at all levels for Los Angeles County.”

Bush announced that Northrop would relocate because he wants his executives closer to lawmakers on Capitol Hill, and officials with the military and intelligence communities, which make up the vast majority of Northrop’s business. The company hasn’t picked a location yet, but expects the move to be complete by summer 2011.

About 300 employees from Northrop’s Century City office are expected to make the move. The company will still have about 30,000 employees in California, the majority of them in the L.A. area in plants that build fighter jets, satellites and unmanned airplanes.

Officials charged with doing outreach to local businesses acknowledged losing Northrop was a blow, but said there wasn’t much they could have done to prevent it.

“You had a new CEO who wants to make his mark on the company and moved it on his first day on the job,” said Bill Allen, president and chief executive of LAEDC.

Allen said his agency regularly does outreach to large local companies such as Northrop. He had met with Northrop’s chief administrative officer most recently in the summer or early autumn, and that no indication was given that the company was thinking about relocating.

Decline of aerospace

The loss of Northrop is galling because Los Angeles has long been regarded as the cradle for aerospace companies, which drove Southern California’s economic engine during the Cold War.

But since then, they’ve greatly diminished their local footprint. Lockheed Corp. uprooted its headquarters to Bethesda, Md., after it merged with Martin Marietta to form Lockheed Martin. It also shifted some of its local manufacturing to Georgia. The company formerly known as Hughes Aircraft left Los Angeles for Alexandria, Va. Northrop was the last great aerospace company that called Los Angeles home.

At the same time, there has been a trend of large companies leaving the county. In 2007, there were 17 Fortune 500 headquarters in L.A. County. In 2009, there were 14. DaVita Inc. announced its departure in summer 2009, so there will be two less when Northrop moves.

And at least one other Fortune 500 departure happened under similar circumstances to Northrop: In 2008, Computer Sciences Corp. moved from El Segundo to Falls Church, Va., the hometown of its newly incoming chief executive, Michael Laphen.

But local officials were still surprised when Bush decided to move Northrop closer to his home state. Allen said he had not scheduled a meeting with Bush before he took over the company Jan. 1 because he did not want to be seen as going over the head of the chief administrative officer or Ronald Sugar, the former chief executive.

“It’s pretty unusual to do outreach to someone before they’re on the job,” he said.

Gary Toebben, president and chief executive of the Los Angeles Area Chamber of Commerce, said he wasn’t aware of any efforts to lobby Bush before he took over. But Toebben added that such activities wouldn’t typically fall to the chamber.

Officials with the Mayor’s Office did not return a request for comment. But Councilman Bernard Parks, who is seen as a business-friendly elected official, said he didn’t think Northrop’s move could be blamed on any one person or organization.

“I don’t know that we had that level of insight to see this coming,” he said.

Fresh worries

Still, Northrop’s move has raised fresh concerns about L.A.’s business environment. The region’s reputation has already been soured by the cost of doing business locally and a bureaucracy that can make the permit process a multiyear ordeal. Businesses also feel that local leaders aren’t receptive to their concerns.

“We’re dealing with a city where business is an afterthought,” said David Fleming, an attorney at Latham & Watkins and the founder of Los Angeles County Business Federation. “Many times I’m approached by large corporations that want to relocate to Southern California, but not to Los Angeles.”

The Mayor’s Office, City Council and county board of supervisors have taken steps in recent months to try and rectify that perception. In December, the supervisors adopted a countywide economic development plan. Last Wednesday, the council and Mayor Antonio Villaraigosa launched a nine-member panel called the Business Tax Advisory Committee that is to recommend business tax reforms; the aim is to attract and retain jobs.

But it’s unclear if those steps will prevent corporate headquarters from leaving in the future. Local business leaders have said Northrop’s relocation should be a wake-up call for Los Angeles to step up efforts to hold on to local companies.

“Some pretty decent efforts are being made, but they need to be accelerated,” said Robert Maguire, the founder and former chief executive of Maguire Properties Inc., a publicly traded real estate investment trust.

Allen said a “major priority” of LAEDC in coming months will be to meet with Northrop executives to talk about the roughly 21,000 people the company still employs in Los Angeles. They want to make sure those jobs don’t jump to Washington, too.