“…at Portsmouth Naval Shipyard, the Navy is prepared to cut the pay of its civilian workforce by 20 percent, the result of a 22-day furlough …These jobs are not just a count of government billets, a macroeconomic statistic, or an unemployment rate fluctuation. These jobs provide financial security for our constituents and health insurance for their families.”
—Senator Susan Collins (R-ME), February 20, 2013 News Release
The most recent federal budget sequester cut funds to both defense and nondefense spending. New England, with its high concentration of defense contractors, such as the naval shipyard in Kittery, ME, will likely feel the effects of the sequestration for years to come. The New England Community Outlook Survey asked a series of questions about policy challenges to communities and the funding and capacity of respondents’ organizations. For each of these questions, respondents pointed to the sequester as a major issue that directly affects lower-income communities through job loss and said that it negatively impacts the organizations that provide much-needed services to the communities.
Just under half of the New England Community Outlook Survey respondents indicated there were specific policy challenges preventing them from fulfilling their mission. Of those that responded affirmatively, 65% specifically mentioned the sequester, budget issues, or lack of funding. Twenty-one respondents, about 13%, specifically mentioned the word sequester or sequestration in one of their open-ended survey responses. One-third not only saw their funding decrease in the previous six months but also expect funding to continue to decrease over the next six months. (Figure 7) At the same time, more than two-thirds of service providers saw the demand for their services increase and almost the same number expect demand to continue to rise in the next six months. (Figure 8) Amid the funding decline and increased demand, somehow service providers are finding ways to do more with less, with 78% of service providers reporting either unchanged or increased capacity over the past six months, and 69% expecting to maintain or increase capacity over the next six months. (Figure 9) But not every organization is likely to be able to do more with less in light of the dramatic cuts. According to the White House Office of Management and Budget, programs ranging from those supported by nutrition assistance funding to those supported by educational funding will be subject to severe budget cuts because of the sequester. In Maine, the Department of Education estimates the sequester will strip $7.3 million from its budget, with its special education and programs for low-income students being the hardest hit, losing $2.8 million and $2.6 million respectively.
Concerns about the sequester go beyond the financial shortfalls, with several service providers mentioning that along with less funding, less certainty about future budgets make it difficult to plan for the future. According to respondents, between cuts to service providers and direct losses of jobs, it appears the sequeaster hits lower-income communities the hardest.
Maine Department of Education, “Sequestration of Federal Funds Anticipated March 1,” http://mainedoenews.net/2013/02/27/sequestration-of-federal-funds-will-go-into-effect-march-1.
Top Three Challenges
1. Availability of Employment Opportunities