What Are the Economic Effects of a Government Shutdown?

The government shutdown, which began Oct. 1, poses a serious threat to the U.S. economy, with analysts predicting a loss of $3 billion, according to MSN. This estimate draws from the 35-day shutdown in late 2018, which the Congressional Budget Office (CBO) reported cost the economy at least $11 billion. Current projections suggest each week of the shutdown could reduce GDP growth by 0.1 percentage points, equating to a $7 billion weekly impact. 

Key Takeaways

• Three important economic reports that were supposed to be released on Oct. 16 were not published as a result of the government shutdown. 

• Reinitiating and preparing for operations after a shutdown requires federal agencies to employ a significant amount of time and resources.

• According to Goldman Sachs economists, economic growth could “slow by 0.15 percentage points on a quarterly basis.

To read more, see this Investopedia article.

Source: Statista