Updated: 7:08 p.m.

Staffers at the Government Accountability Office who had been bracing for layoffs were met with good news Wednesday that there would be no firings or office closures at the agency.

Still, agency head Gene Dodaro unveiled an ambitious plan to cut costs across its operations in advance of steep budget cuts from Congress.

Canceled programs, limited work travel and the elimination of contracted positions could change the way the GAO functions day to day.

“These are difficult times,” Dodaro said in a statement released Wednesday afternoon. “But I know that GAO has been through difficult times before. And when that happens, we work together as a community, help those who need it, focus on our core values and keep quality as our top priority.”

In a two-page statement, Dodaro announced that the GAO’s 3,000-person staff would be reduced by 375 over two years by attrition. Last year, the agency halted “all but the most essential replacement hiring,” and it will do so again over the next 12 months.

Reducing the size of staff would mark the first time in “modern history” that the agency has done so, Dodaro said, and the 12 percent reduction would yield $21 million in savings.

The GAO will, however, eliminate 47 contractor positions across the agency, with their duties either taken over by full-time staffers or ended entirely, according to spokesman Chuck Young.

Depending on the final fiscal 2012 budget allocation, Dodaro also said the agency could require each employee to take up to six furlough days.

“Shared sacrifice spread as evenly as possible across the organization would be better and actually less disruptive than choosing to shut down a field office or terminating a significant number of other positions,” he said.

The GAO employees’ union had previously recommended that management institute furloughs as an alternative to reducing staff, saying that if each employee took 10 to 12 unpaid days off, the GAO could save $15 million to $18 million in the next fiscal year.

On Wednesday, union president Ron La Due Lake said he and his colleagues were “thrilled” with the news.

“We really did expect there would be some layoffs. We just had no idea the degree or where they might be,” La Due Lake said. “We worked collaboratively with the agency, and we’re very heartened that the agency’s decisions involve shared sacrifice of all employees and tremendous value of our colleagues in the field.”

La Due Lake did acknowledge that the budget cuts present challenges. With announced plans to increase telework and video-conferencing to cut back on travel costs, staffers could have a harder time understanding the particular sites and programs that they are reporting on and auditing.

Staffers also will miss the support from contractors whose positions will be eliminated, he said, as they will miss the resources held within the GAO’s technical and law libraries that are slated to close to save money.

“We’re going to be challenged in the next few years in terms of achieving efficiencies in our work and providing essential information with fewer staff, fewer analysts, fewer auditors,” La Due Lake said.

He added that the one-year suspension of the Student Loan Repayment Program could hit younger and newer GAO employees hard. The union had initially recommended to management that it “temporarily [reduce] the scope” of this program as a way to achieve cost-savings without layoffs.

Often referred to as the Congressional watchdog, the GAO is an independent, nonpartisan agency responsible for holding the federal government accountable in its operations and use of taxpayer dollars.

Under the legislative branch spending bill for fiscal 2012 passed by the House in July, the GAO’s budget would be slashed by 6 percent from fiscal 2011. The Senate Appropriations Committee endorsed its own spending measure in September that slated the agency for a 7.6 percent reduction from the previous fiscal year.

Both chambers have yet to agree on a top-line number, but agency officials decided to act in advance of such an agreement.

In the meantime, several Congressional lawmakers have been lobbying senior appropriators to reconsider their conservative allocation.

Sen. Claire McCaskill (D-Mo.) said Wednesday that giving the GAO a larger funding level was a “wise investment,” as the agency produces reports that help the government save money.

“In cutting its budget, we’ll be biting our nose to spite our face,” she said.

John Hart, a spokesman for Sen. Tom Coburn (R-Okla.), who has also fought hard against GAO cuts, agreed.

“Instead of slashing spending for GAO, the committee should be focused on cutting the wasteful spending identified by GAO,” Hart said.