NEW YORK (Reuters) - The government’s effort at cutting spending across the board is hurting a population once considered among the most financially stable - dual income families where both partners are government employees.
Starting on Monday, employees at agencies such as the Federal Aviation Administration and the Office of Management and Budget will be required to take unpaid days off - a consequence of the U.S. government’s sequestration budget cuts. These forced furloughs come on top of the first round of cuts that began on March 1, and they will reduce some workers pay by as much as 12 percent a month.
The cuts, which include decreased work hours for federal employees, hiring and pay freezes and layoffs, hit hard couples like Laurie and Jack Swensen, FAA employees in Kansas City, Missouri. When they both start furloughs next week, the couple will earn $1,900 less every month. The cuts come just as they were making moves to buy a house, said Laurie Swensen.
With six family members, including their eldest son and his pregnant wife, living in a two-bedroom rental home, the Swensens were eager to move. But the furloughs and subsequent pay freezes have forced the family to reconsider.
A Reuters analysis of Census Bureau data from the Minnesota Population Center in March 2012 shows that about 400,000 employed Americans were part of a husband-and-wife team where each worked for the federal government in civilian or military roles.
Civilian personnel will be the first to be affected by the furloughs.
The cuts are expected to have wide-ranging consequences, experts said. Besides destabilizing families that rely on government salaries for both partners, they may undermine loyalty and cause some in-demand and highly qualified workers to leave.
“They’re not taking into consideration what they’re doing,” Laurie Swensen said, referring to Congress and the president. “When you take that big of a chunk of people’s budget, that’s going to put people into bankruptcy. It’s going to put them back where they were just three or four years ago.”
U.S. President Barack Obama proposed sequestration as a political ploy to push Congress to reach an agreement to reduce government spending. When March 1 came and went without an agreement, $85 billion of automatic spending cuts went into effect, pushing federal agencies to furlough employees whether they be meat inspectors or military vehicle mechanics.
The FAA will furlough almost all of its 47,000 civilian employees for a day per pay period to meet its mandatory $637 million budget cuts.
The Department of Defense said it will have to furlough almost all of its 780,000 civilian employees to reduce its budget by $41 billion. Those furloughs will likely start in mid- to late June, and will require employees to take 14 days unpaid leave sometime between the start date and September 30, according to the department website. This is the equivalent of a 12 percent pay cut.
“We’re hearing from a lot of communities that the cutback is already starting,” said Joyce Raezer, associate executive director of the National Military Family Association, an advocacy group. “They’re already deciding ‘I’m not going to buy a new car. I’m going to cut back on my cable bill.’”
Heather Barlow and her husband, Chris, both work at Letterkenny Army Depot in Chambersburg, Pennsylvania.
Heather Barlow lost her job in Letterkenny’s data logistics division in March after the first round of sequestration cuts eliminated her position. The same day, Chris received word from managers and union representatives that employees in his aviation and missile command department could expect to be furloughed one day a week.
Chris, who has not yet been furloughed but was informed by managers and union leaders that it is likely, is selling his Harley Davidson motorcycle to ensure his family has a financial cushion.
Heather, meanwhile, has stocked their freezer and pantry with about two months of non-perishable groceries, something, she said, that makes her feel more in control.
Many conservatives argue that there is plenty of fat in the federal budget that could be trimmed. But, when it comes to sequestration, which is more of an axe than a scalpel, they find they have some common ground with the affected federal employees.
“The one positive thing I could say about (sequestration) is it is cutting spending and these are the only spending cuts we’re getting out of Congress these days,” said Patrick Louis Knudsen, senior budget analyst at the Heritage Foundation, a conservative think tank. “However, it’s not a good way to budget. It leaves a lot of people up in the air.”
Mattie Duppler, director of budget and regulatory policy at Americans for Tax Reform, a conservative, taxpayer advocacy group, agreed saying, “Sequester is definitely an inelegant and possibly the worst way to cut spending. There is plenty of extraneous spending going on at these federal agencies.
“Why are the workers the first to feel the cuts?”
While layoffs and furloughs impact families’ budgets immediately, they also lower morale and loyalty long term, said Paul Light, New York University Professor of Public Service and an expert on civil service and bureaucracy.
The cuts make no distinction between high performers and mediocre ones - everybody goes, he said.
The government does not calculate the impact lower morale has on productivity the way other businesses do, so there is no way to know the economic impact, Light said. But the furloughs may lead to a brain drain of highly skilled workers leaving for more lucrative, private-sector jobs.
“It has a pernicious effect on loyalty to the federal government,” Light said. “The people who will leave are the wrong people to leave — they’re highly skilled workers who can go elsewhere. The people who are staying are staying because they have nowhere else to go or they have no choice.”
Sequestration cuts will also strike specialized workers who are often tied to contracts that prohibit them from leaving.
Chris Lloyd, a contract worker in high security at White Sands Missile Range, the largest military installation in North America, expects to be furloughed beginning in May or June at about the same time he plans to marry co-worker Stephanie McDonald.
The furloughs will mean four-day work weeks for each of them until September 30, about the equivalent of 12 percent of their paychecks.
White Sands, which is also home to a nuclear reactor, employs more than 9,300 people, including 2,459 civilian Department of Defense employees. Almost all of those civilians will be furloughed, but the agency is unable to give more specific information about the start, said Monte Marlin, spokesperson for White Sands. That leaves employees in a holding pattern.
Bill and Christine Mounger, two furloughed FAA employees at the Mike Monroney Aeronautical Center in Oklahoma City, Oklahoma, are turning to sports to make up for the $800 they are losing each month. He will be officiating at as many as three football, softball or baseball games per day
were able to dodge that rule by capitalizing on a talent Bill learned in high school that has nothing to do with his aeronautical engineer work.
To make up some of the $800 they’ll be losing each month, Bill Mounger will be officiating as many as three football, softball or baseball games per day this summer for $18 a game.
Reporting by Elizabeth Dilts; Editing by Chelsea Emery and Leslie Gevirtz