LOS ANGELES, OCT. 10 -- TRW Inc. employes will not be allowed to participate in American Red Cross blood drives at work because the aerospace giant does not want to bill the time it takes to the Pentagon, the Los Angeles Times reported today.

The move is one of the most extreme cases of cost-cutting that is occurring throughout the defense industry as it responds to critical federal audits and increasing Defense Department pressure, the newspaper reported.

American Red Cross officials here said they are concerned about TRW's decision because other aerospace companies might follow suit.

At least one-sixth of the county's supply of donated blood is collected from drives at aerospace facilities.

"It is a great concern," said Janeen Biehl, head of donor services for the Los Angeles Red Cross. "TRW employes {in Redondo Beach} donate 640 units of blood four times a year. At this moment . . . we don't have any place else to get that much blood."

A TRW spokeswoman confirmed Friday that recent blood drives have been canceled, but she said TRW hopes to resume them.

The pressures that led to the cost-cutting decision have increased with the revelations that a number of aerospace contractors have bilked the government. TRW pleaded guilty last month to felony charges of overbilling the Pentagon by $17 million.