Air Force Tech Sgt. Shale Norwitz climbs to perform an upgrade in the legacy antennas at Schriever Air Force Base. (Andy Cross, The Denver Post)

The specter of $500 billion in automatic defense cuts beginning next year hangs heavily over the country's aerospace industry and particularly so in Colorado, which ranks second nationally in aerospace employment and has four military commands.

Even the threat of the cuts has the state's aerospace and economic development communities concerned.

"If something doesn't get done, there will be a slowdown through the fall," said Gen. William Shelton, commander of the Air Force Space Command at Peterson Air Force Base in Colorado Springs.

A slowdown, which some argue already is happening, could include layoffs, no new resources for existing programs, no new programs, no new hires, renegotiated contracts, canceled orders and general stagnation, several experts said.

"It's ominous," said Tom Clark, executive vice president of the Metro Denver Economic Development Corp. The across-the-board spending cuts referred to as a sequester could total 10 percent for defense, something Clark called "pretty much a sledgehammer approach."

Sequestration is what could be triggered under the Budget Control Act which last year reduced the defense budget by $487 billion after a congressional supercommittee failed in November to hammer out a deficit-reduction agreement.

If Congress doesn't find ways to repeal or forestall the sequester, or doesn't find a budget-deficit compromise, the automatic cuts go into effect Jan. 2.

Members of Colorado's congressional delegation are well aware of what sequester could mean to the state, said Dick Hinson, senior vice president of Aurora Economic Development Council.

Everything, he said, is still in play as work for a solution continues behind the scenes on Capitol Hill. Hinson said he sees signs that the two political parties aren't quite as at odds as they have been.

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Colorado's Aerospace Industry Foresees Slowdown Prior to Defense Cuts