Nondefense agencies may be forced to cut as many as 150,000 jobs -- with some heavy layoffs coming as early as this Christmas -- over the next two years under President Reagan's twin attacks on federal spending.
The double-whammy cutbacks could hit as many as 30,000 U.S. workers here. In the "worst possible" scenario arising from the jobs-dollar cutbacks, some agencies, heavy with people and light on uncuttable programs, might have to slice up to 20 percent of their work force with major cuts beginning shortly.
Reagan has excused Defense, VA and portions of Immigration and Naturalization Service, IRS, FBI, State and Customs from the announced two-year, 75,000-job cutting exercise and an even tougher dollars cut. Impact of the two separate reductions, one in jobs the other in dollars, could translate to 150,000 jobs. The bulk of both sets of cuts will be taken by major departments like Energy, Education, HHS, Transporation, and independent and regulatory agencies.
On top of the announced job cuts which have gotten most media attention, Reagan wants nonexempt agencies to take 12-percent spending cuts this fiscal year. Some can do it in large part by trimming programs. But agencies that spend most of their money on payroll will have to take the lion's share of the 12 percent whack out of their S&E (that is salaries and expenses) funds. That means jobs. People.
The 12 percent action is to be taken this fiscal year, which ends Sept. 30, 1982. Because of the heavy short-term costs associated with RIFs (reduction-in-force) agencies that must make the reductions from S&E accounts will have to act quickly. (Workers who get RIFfed can get up to one-years' severance pay plus unemployment compensation -- all of which comes out of the firing agency's budget.) To make a RIF "cost effective" layoffs must be made early in the fiscal year. And right now is early in the fiscal year!
Reagan aides say they hope the cuts mandated by new lower job ceilings (the 75,000 spread over two years) can be handled largely by attrition. That means that if enough people die, resign or retire, agencies can slim down over two years. But the 12 percent spending cut that must be made this fiscal year is a different ballgame. If agencies cannot cut programs, they will have to come up with the savings by firing people. And because of the heavy first-year costs of each RIF, many will have to start sending out 30-day RIF notices -- soon.
There are two things that could minimize the impact of the 12 percent cuts on nonexempt agencies:
* If Congress balks at having pet agencies and programs slashed it could direct the administration to leave them alone, and vote more money than Reagan wants to spend. He could still make the cuts, but at a heavy political price.
* If agencies can find significant savings in other areas, they could absorb major portions of the 12 percent cut. This would work best in larger agencies where programs -- rather than people -- could be dropped or curtailed. It would not work in agencies where most of their money is spent on payroll-associated costs. They could be forced to make chops in the S & E account.
It is too early to predict with any accuracy the extent of the personnel cuts coming. Lots can happen. Things change. But if the worst happens -- and it sometimes does -- the 75,000 job cut over the two years the administration spoke of could balloon to double that amount. That would mean much heavier cuts are coming, and coming a lot sooner than anyone expected in big federal centers like Washington, New York, Philadelphia, Chicago, San Francisco, Denver, Dallas-Fort Worth, St. Louis, Boston, Los Angeles and Seattle.