Defense cuts to hit contractors hard

Contractors are going to feel the bulk of the pain of the cuts that Defense Secretary Chuck Hagel announced this week, FedBiz reported.

The cuts are meant to reduce management headquarters budgets by 20 percent over the next five years. Hagel was quoted by FedBiz as saying that most of these cuts will be achieved through contractor reductions.

No specific amount has been named, but the reductions are expected to save at least $1 billion over the next five years, with roughly proportional cuts each year. These cuts are not tied to sequestration, FedBiz reported.