As reported on The Hill, the nonpartisan Congressional Budget Office on Thursday estimated that keeping the spending cuts from sequestration in place through fiscal 2014 would cost up to 1.6 million jobs. Cancelling the cuts, would increase employment, according to the report, entitled, How Eliminating the Automatic Spending Reductions Specified by the Budget Control Act Would Affect the U.S. Economy in 2014.
Canceling the cuts, on the other hand, would yield between 300,000 to 1.6 million new jobs, with the most likely outcome being the addition of 900,000, the CBO said. “Those changes would increase the level of real (inflation-adjusted) gross domestic product (GDP) by 0.7 percent and increase the level of employment by 0.9 million in the third quarter of calendar year 2014 (the end of fiscal year 2014) relative to the levels projected under current law,” the report states.
The report was requested by Representative Chris Van Hollen of Maryland, whose district is populated with federal workers who have faced furloughs since the sequester went into effect, as described in The Hill.