Sequestration hits Friday, and your small business may not be spared from the effects.
Big Budget Cuts Coming Friday: Will Your Business Take a Hit?
At this stage in the negotiations, it appears almost certain that a deal to avert sequestration will not be reached in time to prevent $85 billion in budget cuts from going into effect on Friday. Congress and the Executive Branch are too far apart on how to ameliorate these cuts, and each party believes the other will suffer more politically from sequestration.
In the real world, the mechanism will have a significant impact among small-business owners, workers and consumers. While $85 billion may only be a small percentage of the federal government’s overall budget, many of these cuts will be felt in key areas including:
- Staff and budget reductions at primary schools and high schools
- Reduction in funds available for financial aid and work-study programs
- Reduction in the number of students with access to Head Start early education programs
- Reduction in job-search assistance programs
- Military expenditure reductions and hundreds of thousands of civilian jobs furloughed
- Justice assistance grants for law enforcement curtailed
- Child care access eliminated for thousands of students
- Reduction in development funds for vaccines for children
- Reduction in funding for public health programs
- Reduction in nutrition assistance for seniors
Small businesses that operated as contractors and subcontractors to government programs will lose access to their funding. Many government services that directly touch small-business owners will also be affected. The TSA, which manages airport security, will be hit by significant furloughs. This means your next business trip may require a two- or three-hour wait in security lines.
Who is Mike Periu?
Mike Periu is the President of Proximo, LLC, a company that markets education and training programs to small business owners, entrepreneurs and consumers.
Mike Periu has been interviewed over 500 times for broadcasters including CNN, NBC TVE, RTE and others. Mike is a contributing author to OpenForum, Yahoo! Finanzas and the Huffington Post.
Mike graduated from Georgetown University in Washington, DC. His degrees are in Finance and International Business. In addition to his work Mike is also on the Board of the Council for Economic Education.
