News / USA

Sequestration Budget Cuts Hitting Defense Contractors

Sequestration Budget Cuts Hitting Defense Contractorsi
X
March 08, 2013 5:20 PM
The U.S. budget cuts known as Sequestration are projected to reduce government spending by $1.2 trillion over 10 years. The cuts are already being felt by U.S. defense contractors. VOA’s Brian Padden visited eastern Virginia, site of the country’s largest naval base and an area that could sink into recession if these cuts stay in place, and he filed this report.
Brian Padden
The U.S. budget cuts known as Sequestration are projected to reduce government spending by $1.2 trillion over 10 years. The cuts are already being felt by U.S. defense contractors.

Davis Interiors is a small company in Norfolk, Virginia that makes specialized furniture and fixtures for U.S. navy ships.  Administrator Whitney Metzger says the firm is already feeling the impact of sequestration.  

“We have had to cut back on employee hours. Almost everyone in this company has had to go down to a four-day work week. Some employees have had to go down to a three-day work week. We are anticipating lay-offs, probably soon,” said Whitney.

Davis Interiors is one of the many private contractors in Eastern Virginia that service the nation’s largest naval base and other military installations.  All together, they employ more than 40,000 people.

The Defense Department’s plan to furlough almost 90,000 employees has not yet impacted the regional economy. But the cancellation of maintenance contracts for 11 ships based in Norfolk is already causing pain to contractors like Davis Interiors.

David Williams has worked for Davis Interiors for 25 years. He says this is the second time in two years that government budget cuts have caused sudden work slowdowns.  

“I am very concerned about it because, I mean, I am still trying to recover from the last time this happened, and you get behind on your bills, and you struggle,” he said.

Whitney Metzger says with foreign wars winding down, defense contractors in the area know that military spending will be reduced, but the sudden sequester cuts are too severe and could put them out of business.

“We don’t know what is going to happen.  We have contracts that we have been awarded that we will be able to see through, but after those, because of sequestration, no new contracts are being issued to anyone," said Metzger.

Defense contractors in this region are the first to feel the impact of the sequester, and, if they remain in place, economists predict the entire state of Virginia will soon spiral into recession.

You May Like

Scotland Vote Raises Questions of International Law

Experts say self-determination, as defined and protected by international law, confined narrowly to independence movements in process of de-colonization More

Video Whaling Summit Votes to Uphold Ban on Japan Whale Hunt

Conservationists hail ruling as a victory, but Tokyo says it will submit revised plans for a whale hunt in 2015 More

Annual Military Exercise Takes on New Meaning for Ukraine Troops

Troops from 15 nations participating in annual event, 'Rapid Trident' in western Ukraine More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Russian Economy Reeling After New Western Sanctionsi
X
September 18, 2014 2:28 AM
A new wave of Western sanctions is hitting Russia’s economy hard. State-owned energy firms continue to bleed profits and Russia’s national currency plunged to a new low this week after the U.S. and the European Union announced new sanctions to punish Russia's aggressive stance in eastern Ukraine. But as Mil Arcega reports, the sanctions could also prove costly for European and American companies.
Video

Video Russian Economy Reeling After New Western Sanctions

A new wave of Western sanctions is hitting Russia’s economy hard. State-owned energy firms continue to bleed profits and Russia’s national currency plunged to a new low this week after the U.S. and the European Union announced new sanctions to punish Russia's aggressive stance in eastern Ukraine. But as Mil Arcega reports, the sanctions could also prove costly for European and American companies.
Video

Video Belgian Researchers Discover Way to Block Cancer Metastasis

Cancer remains one of the deadliest diseases, despite many new methods to combat it. Modern medicine has treatments to prevent the growth of primary tumor cells. But most cancer deaths are caused by metastasis, the stage when primary tumor cells change and move to other parts of the body. A team of Belgian scientists says it has found a way to prevent that process. Zlatica Hoke has more.
Video

Video Mogadishu's Flood of Foreign Workers Leaves Somalis Out of Work

Unemployment and conflict has forced many young Somalians out of the country in search of a better life. But a newfound stability in the once-lawless nation has created hope — and jobs — which, some say, are too often being filled by foreigners. Abdulaziz Billow reports from Mogadishu.
Video

Video A Dinosaur Fit for Land and Water

Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Video

Video Iraqi Kurdistan Church Helps Christian Children Cope find shelter in churches in the Kurdish capital, Irbil

In the past six weeks, tens of thousands of Iraqi Christians have been forced to flee their homes by Islamic State militants and find shelter in churches in the Kurdish capital, Irbil. Despite U.S. airstrikes in the region, the prospect of people returning home is still very low and concerns are starting to grow over the impact this is having on the displaced youth. Sebastian Meyer reports from Irbil on how one church is coping.
Video

Video NASA Picks Boeing, SpaceX to Carry Astronauts Into Space

The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video Future of Ukrainian Former President's Estate Uncertain

More than six months after Ukraine's former President Viktor Yanukovych fled revolution to Russia, authorities have yet to gain control of his palatial estate. Protesters occupy the grounds and opened it to tourists but they are also refusing to turn it over to the state. VOA's Daniel Schearf reports from Mezhigirya, just north of Kyiv.
Video

Video China Muslims Work to Change Perceptions After Knife Attacks

China says its has sentenced three men to death and one woman to life in prison for a deadly knife attack in March that left more than 30 dead and 140 injured. Beijing says Muslim militants from China's restive western region of Xinjiang carried out the attacks. Now, more than six months after the incident, residents in the city are still coping with the aftermath. VOA's Bill Ide has more from Kunming.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid