Sequestration portends ominous future for some feds

The automatic budget cuts slated to kick in Jan. 2, 2013 could have a devastating impact on the job market in shedding more than 2 million jobs, many of which belong to key federal employees, new analysis shows. 

"The results are bleak but clear-cut," said Stephen Fuller, professor and director for regional analysis at George Mason University, who conducted the research with Chmura Economics and Analytics on behalf of the Aerospace Industries Association.

The findings conclude 2.14 million U.S. jobs could be eliminated if the Budget Control Act's sequestration directive takes place and budget cuts of $1.2 trillion occur throughout the federal government. Fuller said the unemployment rate will rise above 9 percent and decrease projected economic growth in 2013 by two-thirds. 

“An already weak economy will be undercut as the paychecks of thousands of workers across the economy will be affected from teachers, nurses, construction workers to key federal employees such as border patrol and FBI agents, food inspectors and others,” he said.

The spending cuts affecting defense and non-defense discretionary spending in the first year of implementation will trim down the nation's gross domestic product by $215 billion. Personal earnings of the workforce will decrease by nearly $110 billion, according to the analysis. California, Virginia and Texas are expected to see the largest potential job losses.

In responding to the bleak numbers in the report, Sen. Kelly Ayotte (R-N.H.), said the analysis emphasizes sequestration “will also crush our economy, devastate our defense industrial base, and put tens of thousands of Americans out of work.” 

“Republicans and Democrats must work together now to find alternate spending reductions that will not add a national security crisis to our fiscal crisis,” she said.


 

About the Author

Camille Tuutti is a former FCW staff writer who covered federal oversight and the workforce.

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Reader comments

Wed, Jul 18, 2012

I am a federal employee. My paycheck goes right back into the economy. I buy the same items as the private sector. Food, clothing, cars, computers, etc. Just think what is being said here. Unemployment is already high and a lot higher than the numbers being touted in the press. Do you know what doesn't get counted in those numbers? The people who ran out of unemployment benefits and those that have dropped off the unemployment grid. Actual numbers are reported to be as high as 20 percent or higher. Now lets damage the economy further by removing another 2.14 million jobs?!?! That is the same thing as you having shot yourself in one foot and thinking that by shooting yourself in the other foot will just make it all better! The country needs as many people working as it can. The smart thing to do is to get more and more people back to work. If people would just pay attention, they would see the dismantling of this country step by step, day by day!

Wed, Jul 18, 2012 buljos San Diego

Government spending is certainly not "...simply pooled collective resources to accomplish things that are either not profitable to private business, or too large in scale to be handled by small private collectives." If that were simply the case, there would be no justification for socioeconomic categories of small businesses (e.g. HUBZone, SDVO, 8(a), 8(m)) to support with targeted "pooled collective resources" to do very profitable things. Government spending ought to simply accomplish things that are inherently governmental, and nothing else. Leaving it to the government to decide what's not profitable for private businesses (as if they could figure that out anyway) or is too big to accomplish by small companies, and as a result of that decision remove yet additional "pooled collective resources" from the marketplace in order to create yet additional government institutions to do that work themselves is obviously and definitely not in the country's best interest.

Wed, Jul 18, 2012 Peter

@MBA: Not nonsense, and I am sure that anyone involved with building roads, law enforcement, fighting wildfires, protecting this country, delivering health care to veterans, doing medical research at NIH, etc would vehemently disagree that their paychecks they turn around and spend on food, tolls, gas, clothes, etc are useless. Sounds to me like your "MBA" is a bit useless!

Wed, Jul 18, 2012

I think it's high time that we exercised our perogative to vote ALL of the incumbants out of office, sending a clear message to both political parties that they need to either be a part of the solution, or get out of the way.

Wed, Jul 18, 2012

I agree. This is a bit like the misconception that reigned at the time when Adam Smith wrote Wealth of Nations. At the time many nations thought they created wealth by stealing gold and silver from other lands. Adam Smith set them straight - business enterprises create wealth. We have forgotten the lesson and now believe that government jobs somehow create wealth and prosperity.

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