SALT LAKE CITY — Nearly 200 Utahns reported to work Thursday morning to learn they no longer had jobs, casualties of the federal budget cuts known as sequestration.
L3 Communication Systems-West announced it is laying off 4.2 percent of its workforce, or about 180 employees, including operations, administrative, engineering, technical and professional staff.
Camille Guth, vice president of human resources for the Salt Lake City-based defense contractor, said the layoffs were a response recent budget cuts to the Department of Defense.
The company said the "difficult but necessary action was taken after careful consideration to maintain the division's overall competitiveness and improve its ability to win and execute new business pursuits."
"It's really just because of the overall situation we're facing in this defense budget environment with uncertainties about the sequestration," Guth said.
The cuts were companywide, she said, but she declined to comment if some departments were facing more layoffs than others.
Tage Flint, president of the Utah Defense Alliance, said that the entire defense industry already was hurting because of last year's deep cuts to the defense budget.
I would think it would be difficult to find jobs in the same sector because the entire sector is facing the same problems.
"The sequestration is a second hit to the DOD," he said. "That's why you're seeing furloughs in the DOD sector and not in some other agencies."
Flint said he is concerned Utah will be hit particularly hard by the defense cuts because of the large percentage of the state's jobs in the defense industry, including those at Hill Air Force Base.
Employees laid off by L3 likely will have a hard time finding similar jobs elsewhere, he said.
"I would think it would be difficult to find jobs in the same sector because the entire sector is facing the same problems," Flint said. "These are highly trained, higher paid jobs, and those tend to be the ones that go away."
Marty Carpenter, executive vice president of communication for the Salt Lake Chamber, compared the sequestration cuts to a slow boil.
Initially, as people saw the deadline coming, there was a "Chicken Little" effect, Carpenter said. But after a few weeks, when the cuts did not have an immediate impact, they were somewhat dismissed.
Now, businesses such as L3 are feeling the impacts, he said.
"When you have to take cuts like that, there are going to be ripple effects, and sometime they're slower rolling waves," Carpenter said. "They do touch businesses."
Utah Department of Workforce Services spokesman Nic Dunn said the department has not seen a trend in layoffs in Utah resulting from the federal budget cuts, and he's confident the economy is growing in a way to absorb future impacts.
"Our economy is adding jobs at faster than historical norms. Our unemployment rate continues to drop, and our labor force participation rate is increasing," Dunn said, noting that department database currently has nearly 20,000 job listings. "When we look at those high-level metrics, we're optimistic."
The Department of Workforce Services is partnering with L3 to host a workshop for impacted employees at 1 p.m. Monday at the Salt Lake County Employment Center, 5735 S. Redwood Road.
L3 is offering laid-off employees separation payments and outplacement assistance.
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