Manufacturers: Automatic Defense Cuts Will Cost 1 Million Jobs

Posted June 21, 2012 at 12:33pm

The National Association of Manufacturers today unveiled a report that it plans to use as its key lobbying tool to fight potential big cuts to the defense budget.

The main message: If Members of Congress allow automatic defense cuts known as sequestration to take effect, then more than 1 million private-sector jobs will disappear in 2014, including 130,000 in manufacturing.

NAM officials said they will deliver the study to Capitol Hill this afternoon in a closed-door session with Sens. John McCain (R-Ariz.) and Kelly Ayotte (R-N.H.) and other Members.

“These cuts will not just cut into an executive’s bonus,” said Della Williams, president & CEO of the 92-employee Texas defense contractor Williams-Pyro. “They will put companies like mine and thousands of skilled workers out of business.”

Williams, who said she was in town to “put a name and a face” on the issue, spoke to reporters at a briefing before heading up to the Hill. She said that while most attention is focused on the big defense contractors such as Boeing Co. and Lockheed Martin Corp., the cuts will devastate smaller firms. Local communities and service-sector jobs also will take a hit, NAM officials noted.

“I urge Congress and the Defense Department to go back, sharpen their pencils,” she added. “Sequestration is surgery with a chain saw.”

Brett Vassey, president and CEO of the Virginia Manufacturers Association, and Virginia Chamber of Commerce President Barry DuVal said the commonwealth would suffer because so many jobs are connected to the defense sector. “It would take a decade or more to recover,” DuVal said at the press briefing.

The NAM analysis concluded that Virginia’s economy would experience the second most job losses, behind only California. Texas came in third.

“This will become our major advocacy document,” said Aric Newhouse, NAM’s senior vice president for policy and government relations. “This becomes the major messaging point. The impact is very clear, and it’s about jobs.”

Newhouse added that NAM wants to work with Members on both sides of the aisle. But the issue is already caught up in partisan politics.

McCain and Ayotte have warned their colleagues not to allow the automatic defense cuts to take place, and the pair is part of a group of GOPers trying to force Democrats and the White House to come up with an alternative. So far, they haven’t convinced Senate Majority Leader Harry Reid (Nev.), who told a reporter last month: “I am not going to back off the sequestration. That’s the law we passed … to now see the Republicans scrambling to do away with the cuts to defense, I will not accept that.”