The White House’s Council of Economic Advisers has released a report warning that the U.S. could lose as much as $15 billion in gross domestic product for each week the government is shut down.
A monthlong government shutdown could result in 43,000 additional unemployed individuals in the U.S., according to the CEA analysis published Wednesday.
Government Shutdown’s Disruption to Federal Workforce
The report noted that more than 1.9 million federal civilian employees could be subject to furloughs or required to continue working without pay during a government shutdown.
According to the analysis, federal contractors are not eligible for backpay once government operations resume, leaving many to experience lasting income losses throughout the funding lapse.
CEA estimated that a monthlong government shutdown could reduce consumer spending by roughly $30 billion nationwide. According to the analysis, about half of that decline would stem from unpaid federal employees and contractors and the other half would result from spillover effects across other sectors.
Impact of Government Shutdown on Benefit Programs
The report addressed the potential disruption of government shutdown to benefit programs, including the Women, Infants and Children program, or WIC, and the Supplemental Nutrition Assistance Program.
CEA noted that federal funding for WIC could run out in October and that carryover and contingency funds would be insufficient to sustain program operations amid a prolonged government shutdown.
According to the report, nearly 50 percent of CMS personnel would be furloughed under a government shutdown, which could result in longer wait times to talk to a Medicare customer service representative.
