Engineers and technologists are generally thought to be critical to various aspects of our society, including national security, economic competitiveness, and the general welfare. This report asks questions and provides some answers about how employment of engineers in defense industries and laboratories affects employment in civilian industries and laboratories. The document contains: (1) an historical overview (including notes about significant events and policy initiatives); (2) an assessment of the current situation (providing an overview of the defense buildup, the market for engineers, and defense employment); (3) an identification of potential mechanisms that could be used in preparing for the future (including discussions on methods for anticipating supply and demand); and (4) a set of conclusions with suggestions of areas that need further study. A bibliography is included, along with extensive appendices which provide a set of papers commissioned for this study, related tables, and views of school placement officers. The commissioned papers include the following: (1) "Scientific and Engineering Personnel: Lessons and Policy Directions," by Eli Ginzberg; (2) "Modeling the Supply of Scientists and Engineers: An Assessment of the DauffenBach-Fiorito Work," by Michael S. McPherson; and (3) "What Can Demand and Manpower Requirements Models Tell Us about the Impact of Defense Spending on the Labor Market for Scientists and Engineers?" by W. Lee Hansen. Views of placement officers are expressed in a summary of a college relations discussion group meeting and in a paper by Robert K. Weatherall: "Defense and Nondefense Employment: The View from Engineering School Placement Offices." (TW)