Pink slips being printed as Congress vacations, defense industry likely to cut thousands of jobs

He also noted that military spending cuts will hurt subcontractors: “A lot of our small businesses that we deal with, they’re needing a lot of the money upfront. It’s a trickle-down effect. As it affects us, it’s going to affect our subcontractors and business partners.”

Military leaders have said sequestration will force the Pentagon to lay off or furlough thousands of civilian workers; delay maintenance on ships, aircraft and vehicles; cancel contracts for new weapons; and postpone troop deployments.

The effects of such actions can rock the companies and the communities where they are located.

Budget uncertainty has forced the Army not to issue any orders for depot maintenance beyond January, an Army spokesman said.

Many of the depots are in small towns, such as the Letterkenny Army Depot at Chambersburg, Pa. According to the depot’s website, it is the largest employer in Franklin County, with more than 3,600 employees.

Gen. Raymond T. Odierno, Army chief of staff, told Congress last week that fewer orders at military depots would result in layoffs for 10,000 civilian workers across the country.

Loss of expertise, experience

Gen. Odierno said the Army would have to reduce purchase orders to more than 3,000 small companies and “our assessment tells us 1,100 of those are then at moderate to high risk of bankruptcy if we have to execute [defense cuts] this year.”

Defense contractors and military leaders say the effects of sequestration will extend beyond job losses.

If defense purchases of certain products that meet military specifications halt, the manufacturers of those items might have to discontinue making them, company officials say.

“I am concerned, and our industry partners are concerned, that some of them just aren’t going to make it, and then you don’t have a supplier for a critical component,” Mr. Carter testified last week.

Milwaukee Valve Co. Inc. of New Berlin, Wis., makes bronze valves for aircraft carriers and other ships that play critical roles in controlling the flow of water or fuel throughout vessels.

Two weeks ago, the Navy announced that it was delaying a major overhaul for the aircraft carrier USS Abraham Lincoln. Under sequestration, construction for the aircraft carrier USS John F. Kennedy would be delayed.

“Carriers are just massive and need lots and lots of pipe,” Milwaukee Valve President Rick Giannini said, adding that one carrier requires as many as 10,000 valves.

Meeting Navy specifications requires time, testing and inspection, and lower-quality products could cause huge problems, he said.

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