A party directive issued in September spelling out layoffs in 26 ministries and state-owned enterprises made no mention of the Interior Ministry or armed forces, El Nuevo Herald of Miami reported.
Vladimiro Roca, a dissident and former air force pilot, told the Herald by phone from Havana, "They are set on maintaining the repression at a very high level."
Police are recruiting officers, the military and security budgets are increasing and the government has bought riot-control and light military equipment abroad, the report said.
The new gear could be designed to "put down ... rioting in the event the Raul Castro government's experiment in economic liberalization goes awry," said Armando Mastrapa, a Cuban-American academic expert on the Cuban military.
Ukraine reportedly sold military equipment to Cuba in 2004, China sold it vehicles and Spain exported riot equipment to Havana in 2008.
A well-equipped riot squad made its public debut in September, quelling Pakistani medical students who were complaining about the quality of their training and limited Internet access, the Herald report said.