Defense Contractor Nervous About Spending Cuts That Loom

By Jeff Neumeyer

July 16, 2012 Updated Jul 16, 2012 at 5:16 PM EDT

FORT WAYNE, Ind. (Indiana's NewsCenter) --- The head of a key Fort Wayne defense contractor is keeping a close eye on Capitol Hill this week, concerned that looming defense cuts may hurt his company's bottom line.

It means nervous times for Raytheon and other firms in that same category.

Defense industry leaders will be addressing the House Armed Services Committee on Wednesday, where they are expected to warn Congress how devastating threatened defense spending cuts could be to that industry's fiscal health.

Raytheon held an event Monday, turning over $5,100 to the Veterans Administration.

It’s money that was raised by employees of the Fort Wayne operation.

The threat of $500-billion in defense cuts could take cash out of the pockets of companies like Raytheon.

A local manager says some pain is already being felt.

Jeff Miller/Raytheon Site Executive: " We've been in a hiring mode for several years now and obviously, this year that's turned around and we're not hiring. We've been fortunate to not have any significant layoffs at this point, but again, we're not immune from the cutbacks in defense. If these get more severe through sequestration, that would obviously be more of a challenge for us, but right now we're holding steady."

Sequestration is a term used to stand for automatic cuts.

The Budget Control Act offered a “super committee” a chance to identify $1.2 trillion in cuts to hold down the national debt.

Because that process didn't produce results, sequestration is set to kick in, which means automatic cuts across the board, including ones for defense.

Raytheon now has about 950 workers in Fort Wayne, down from a little over a thousand last year.

Hopefully, the payroll doesn't diminish further, due to defense spending reductions.

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