As a result of the U.S. Congress missing Friday’s sequestration deadline, a series of large automatic spending cuts are set to take place for federal programs. Over the next nine years, US$1.2 trillion in cuts will take place – with US$85 billion in automatic spending cuts occurring by the end of this fiscal year.
The American Hotel & Lodging Association said the cuts will have wide ranging affects, particularly relating to the travel industry:
- Government travel will likely be the first item cut as federal agencies seek to reduce budgets. Hotels can expect to see meetings postponed, travel bookings shortened, and government planners delaying contract signings as they await a congressional solution.
- The Federal Aviation Administration estimates it will have to furlough the majority of its 47,000 employees, forcing the nation’s busiest airports to close runways and eliminate certain shifts for control towers. This will result in widespread flight delays and cancellations.
- Secretary of Homeland Security Janet Napolitano recently stated that the sequestration-prompted furloughs for the Transportation Security Administration will “substantially increase passenger wait times at airport security checkpoints.”
- National parks will be closed. The impacts of this step have been seen before, during the previous government shutdown in 1995, as the National Park Service shuttered 368 sites, turning away 7 million visitors, while national monuments and museums were closed to another 2 million visitors.
- The Department of Homeland Security estimates it will have to furlough 5,000 border patrol agents.