NSC releases updated sequester analysis.

February 19, 2013

On February 18, NSC released an updated version of Disinvesting in the Skills of America’s Workforce: The Potential Impact of Sequestration on Key Federal Employment and Training Programs, along with updated state-specific sequestration fact sheets.  These new reports reflect changes made to sequestration by the January fiscal cliff deal.

The January fiscal cliff agreement delayed sequestration until March 1. This two-month delay in sequestration required a down-payment of $24 billion, which was split equally between revenue and spending cuts (achieved by reducing the discretionary spending caps devised by the Budget Control Act by $12 billion over the next  two years – divided equally between defense and non-defense), reducing the total cut for FY 2013 to $85.33 billion.

In FY 2013, approximately $16 billion of the non-defense sequestration cuts will come from entitlement programs, totaling about a 2 percent cut to non-exempt programs.  The remaining $26.4 billion in non-defense cuts will come from an estimated 5.1 percent across-the-board cut in funding for discretionary programs.  

The fiscal cliff deal only reduced the size of the sequesters for FY 2013. In FY 2014-2021, the total cut will rise to $109 billion. In the remaining years, those cuts will be made by lowering the spending caps established under the Budget Control Act.  

Despite a smaller cut to non-defense programs in FY 2013, NSC estimates the cuts will still be devastating for workforce programs. If sequestration occurs, in FY 2013 alone nearly 2 million individuals will lose access to critical employment and training programs.  

Federal workforce development programs cannot afford these cuts. Since 2001, federal investments in workforce education and training have declined by more than 30 percent – with more than $1 billion in cuts coming just since 2010 – and sequestration could mean billions more in cuts over the next decade.

NSC has urged Congress to avoid sequestration, and instead adopt a balanced approach to deficit reduction. In December, National Skills Coalition joined with 200 organizations urging no further cuts to workforce programs. More recently, NSC joined 3,200 organizations representing the discretionary community to urge Congress to adopt a balanced approach to deficit reduction that does not include further cuts to discretionary programs.

NSC will continue to weigh in with policymakers as they consider alternatives to sequestration.