US set to lose 2 million jobs
The Aerospace Industries Association released the findings of a report on Tuesday that suggest that the automatic cuts in federal spending slated to kick in on January 2 have the potential of being far more damaging than imagined. The author of the report, Dr. Stephen Fuller of George Mason University and Chmura Economics and Analytics, suggests that while the Obama administration-endorsed sequestration goes about as scheduled, more than 2 million Americans will see their jobs eradicated in just 2013."If they are allowed to occur as currently scheduled, the long-term consequences will permanently alter the course of the U.S. economy's performance, changing its competitive position in the global economy," the report warns.The expected cuts are touted as a necessary means to adjust the country’s growing deficit by way of decreasing Defense Department spending. This latest analysis reveals, however, that it isn’t just those with direct ties to the Pentagon who will be jobless. While the future of the Aerospace Industries Association — a trade group with close ties with the Pentagon — is obviously at stake, Dr. Fuller’s report says that it will be more than just military men and women made jobless by the cuts. In addition to lay offs coming to defense contractors and others with close DoD ties, the study suggests that as many as 600,000 federal workers will lose their jobs. Dr. Fuller adds that the automatic cuts, if triggered next year, could cause the US to see it’s gross domestic product drop by $215 billion in 2013, in turn plummeting consumer confidence and perhaps paving the way for years of irreversible damage. As the Associated Press reports, however, the federal government has not outlined specifics of the sequestration plan, suggesting that there is indeed some degree of uncertainty in the AIA released report. Later this week, the US House of Representatives is expected to vote on a measure that, if passed, could force President Barack Obama to put forth specific details about where the cuts will occur."The federal agencies haven't said what they would cut back," Dr. Fuller tells the AP. "They don't have too many choices because most of their budget is payroll, where the Defense Department has more choices because most of its budget isn't payroll."