The nation's capitol and nearby Virginia and Maryland will likely feel the worst of the impact. States heavily-reliant on federal spending - as far away as New Mexico - are also in for some rough weather.


With half of the roughly $85 billion in cuts targeting the Pentagon, the impact will be heavily concentrated in D.C., Virginia and Maryland, where defense spending accounted for about 10 percent of the three states’ combined economies in 2010, according to a report last month from Wells Fargo economists Mark Vitner and Michael Brown.


“Cuts in nondefense outlays would likely trigger significant furloughs, layoffs at civilian contractors and generally less business for supporting services, including law firms, caterers, airlines and hotels,” the report said.

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Virginia, where many defense contractors have set up shop near the federal money spigot, is squarely in the cross-hairs of the impending budget cuts. The state is home to 174,000 federal workers, 19 military facilities (including both the Pentagon and the country’s largest naval base in Norfolk), 90 federal offices, 550 federal government-leased or -owned properties, and 25,000 federal government contractors.