Government shutdown costing the economy billions of dollars each week

The ongoing U.S. government shutdown, now on Day 38, is taking a significant toll on the national economy, with experts warning of a visible and permanent loss of economic activity. Estimates of the economic impact range from $7 billion to $16 billion per week, with the White House’s Council of Economic Advisers forecasting a weekly loss of $15 billion. A recent CBS News poll found that 54% of Americans are very concerned about how the shutdown is affecting the economy.

One of the hardest-hit groups by the shutdown are federal workers, with hundreds of thousands going without pay. The Bipartisan Policy Center estimates that at least 670,000 federal workers are furloughed and roughly 730,000 are working without pay. The reduction in hours worked by furloughed federal employees alone could cost the economy $14 billion by year-end if the shutdown continues.

Consumers are also feeling the impact, particularly those enrolled in the Supplemental Nutrition Assistance Program (SNAP), as food stamp benefits have been interrupted. This, coupled with other financial strains such as a spike in Affordable Care Act health insurance rates, is temporarily sapping consumer spending.

Small businesses, which rely on government loans and business from federal agencies, are also feeling the pinch. The shutdown is preventing the Small Business Administration from distributing $170 million in federally guaranteed loans per day, leading to a total loss of $4.5 billion in capital for more than 8,300 small businesses.

Federal contractors, including millions of contract workers, are also being impacted by the shutdown, with many private businesses facing revenue losses. Around 5.2 million federal contractor workers stand to be impacted, with the risks greater for small business contractors.

The travel industry is feeling the impact as well, with the Federal Aviation Administration ordering airlines to cut thousands of flights across the U.S. As of Wednesday, the industry had already lost roughly $5 billion in travel spending, just weeks before the busiest travel period of the year.

Overall, the government shutdown is expected to take a toll on U.S. gross domestic product (GDP), with the Congressional Budget Office estimating a reduction in annualized GDP growth in the final three months of the year by 1 to 2 percentage points. While most of the decline in growth is expected to be recovered once the government reopens, there is still a forecasted permanent economic loss of $7 billion to $14 billion.

In conclusion, the government shutdown is having far-reaching effects on the economy, impacting federal workers, consumers, small businesses, federal contractors, travel companies, and overall economic growth. As bipartisan congressional talks to end the shutdown continue, the economic consequences are becoming more pronounced, with a long-lasting impact on the nation’s economy.