Businesses in military towns brace for budget hit

FAYETTEVILLE, N.C. (AP) — Small business owners who rely on the nation's military posts for their business say they are already bracing for a hit from the automatic budget cuts that took effect March 1.

Soldiers' salaries are exempt from the cuts, which total roughly $85 billion across the entire military. However, civilian employees who work on bases are expecting furloughs that could significantly slash their paychecks.

Near North Carolina's Fort Bragg, in Fayetteville, Mike Thomas is the general manager of Auto Express. Thomas says smaller paychecks mean fewer sales at his shop, which specializes in selling Jeeps, chrome wheels and sound systems.

Business owners in Virginia, Tennessee, Kentucky, Texas and Alabama that rely on bases are expecting a similar hit, saying people could wind up spending less on everything from haircuts to furniture.