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TUCSON - Cuts to defense spending are on the table for those in Congress and some local companies are watching the issue closely.

Kevin Garcia is the CEO of Breault Research, an optics company. "It's unknown to us right now if any of those projects would be affected by the sequestration."

The company employees 34 people, its only site is in Tucson. "So we're working on wide variety of optical systems which can range from automotive headlamps to zoom lenses in cameras," he explained.

According to Garcia Breault Research has several projects funded by the Department of Defense, he said they are spread across different branches of the military.

The director of engineering for Breault Research Mark Fink said, "if you have a huge cut in the defense budget you have aerospace companies then laying off engineers, technicians, other support people. That's the first order affect. Those people are then not buying furniture, stereos,TVs, getting their cars fixed in the local economy."

Fink said Breault Research could avoid layoffs because the company is diversified with commercial, government and other military type projects.

It's a similar story at Paragon Space Development Corporation, the company develops life support systems for extreme environments, "the major impact really comes in our ability to bring out the next generation of technology," said Taber McCallum. He said if sequestration were to happen the company could also avoid lay offs. The company employs approximately 70 people and has sites in Arizona, Colorado and Texas.

Arizona's defense industry employs nearly 40,000 people and pays more than $4 billion in wages.