Economic growth will cool to a 1.5 percent annualized pace in the second quarter after growing at a 2.5 percent pace in the prior three months, according to a Bloomberg survey of economists from April 5 to April 9.
Executives at staffing firm Kforce Inc. said they saw the impacts of sequestration rippling through their business. The Tampa, Florida-based company earlier this week reported first- quarter revenues that were lower than a year ago.
“The sequestration was an issue to us,” Chief Executive Officer David Dunkel said during an April 30 earnings call. “Frankly, we didn’t expect to see the ripple effect to commercial clients that we’re doing business with, with other government clients, subcontract business, and even state and local business.”
The government spending cuts could lead to 400,000 to 600,000 job losses and another 1.5 million furloughs this year, according to Bank of America Corp.’s Joshua Dennerlein. The cuts should begin to escalate in June and July and could affect the manufacturing and professional and business service industries, the New York-based economist said.