The head of the largest U.S. government employer says there is still a long way to go to remove uncertainty for federal employees despite the end of the government shutdown.
"People have to have some confidence that they have a job that they can rely on," Defense Secretary Chuck Hagel told reporters at the Pentagon on Thursday. "We can't continue to do this to our people, having them live under this cloud of uncertainty."
With a $680 billion budget, the Pentagon has the highest payroll of any federal agency as it supports 7.4 million active duty forces and 718,000 civilian workers.
Hagel said the civilian defense workforce was hit hardest during the 16-day shutdown that ended on Thursday.
The Pentagon estimated at minimum a $600 million loss of productivity due to the furlough of about 400,000 civilian workers during the first four days of the shutdown before Congress and President Barack Obama agreed to bring some of them back in.
And with only a temporary reprieve before another budget and debt ceiling deadline early next year, Hagel did not strike an optimistic tone about the long-term prospects toward a more stable fiscal environment.
"I don't know if a compromise can be reached, if some kind of an agreement can be reached to deal with these issues," Hagel, a former Republican Senator from Nebraska, said. "That's part of the uncertainty."
The recent impasse has also shaken confidence in the United States on the international stage, Hagel said.
He noted several people asked him on a recent trip to Asia whether the country would be able to keep its commitments.
Added to the concern over the size of future budget packages, the looming threat of another round of forced spending cuts in January, known as sequestration, is also likely to have an effect on both the size and readiness of the country's defense capabilities.
Hagel told reporters that the current round of sequestration, which took effect last March and requires $1 trillion in domestic and defense cuts by 2021 -- has already led to a reduction in some training and long term investments in equipment.
"That adds to impact on our readiness, and, sure, that eventually will present capability issues for us," Hagel said.
Robert Hale, the Pentagon comptroller, told reporters at the same press conference, there would consequences all across the Pentagon if another round of sequestration goes forward.
"We are going to get smaller," he said. "I just can't tell you how much."