Pentagon explains Panetta’s warning that sequestration would cost 1.5 million jobs

Defense Secretary Leon Panetta surprised everyone when he contended in September that the sequestration trigger would result in a 1 percent increase in the unemployment rate, costing 1.5 million jobs in defense and other areas. Nearly seven weeks later, the Pentagon has an explanation.

Pentagon spokesman George Little said in an email that the Defense Department worked with the University of Maryland to examine possible effects of various spending reductions. Officials plugged some numbers into an established forecasting model -- the Long-Term Interindustry Forecasting Tool -- and the data were applied to a simulation of the U.S. economy hit with across-the-board spending cuts.

One big caveat, however: The model doesn't factor in the tens of billions of dollars in war spending, known as overseas contingency operations, that the Pentagon counts outside of the regular defense budget.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by eSignLive by VASCO

    Mobile E-Signatures for Government

    Learn 5 key trends that accelerate government demand for mobile signing.

    Download
  • Sponsored by Management Concepts

    SPONSORED: Successful Change Management Practices in the Public Sector

    How governmental agencies implement organizational change management.

    Download
  • Sponsored by Kronos

    Solving the Workforce Compliance Challenge

    Download this eBook to learn how data and automation can help state and local agencies.

    Download

When you download a report, your information may be shared with the underwriters of that document.