A renowned economist has relaxed her predictions of how much Virginia's economy will be affected by federal sequestration.
Chris Chmura, president of a quantitative research and economic development consulting firm based in Richmond, Va., said across-the-board spending cuts will hurt the commonwealth more than most states, but she still expects to see modest job growth.
Chmura said sequestration will affect the state's defense contracts more than the non-defense sector, and the Northern Virginia and Lynchburg areas could be most at risk. Hampton Roads also relies heavily on government contracts, but has decreased its dependence on them.
Although it's not easy to transition from being a defense consultant, areas with a highly-educated workforce could rebound more easily from potential cuts, according to Chmura.
"In some of the alternative markets that we're seeing right now -- cyber security, unmanned vehicles, environmental issues -- are areas that I think the private sector is able to transition to, which really helps the Virginia economy overall," Chmura said.
A revival of Virginia's housing industry also will help, said Chmura. The finance sector's continuing recovery is particularly beneficial to the Richmond area. Chmura added that some skills of veterans and Department of Defense personnel could be re-purposed for IT or research jobs that are in high demand.