A government shutdown primarily affects federal employees and the services provided by government agencies. Employees in non-essential roles are typically furloughed without pay, while essential workers continue to work but may not receive pay until funding is restored. Government contractors and businesses reliant on federal purchases also face economic consequences. Many government services such as processing passports, issuing loans, and maintaining national parks may be delayed or suspended. However, entitlement programs like Social Security, Medicare, and Medicaid generally continue to operate since they are funded through mandatory appropriations. Longer shutdowns can have broader economic impacts, including reduced GDP and effects on food assistance programs like WIC and SNAP.
Who Is Affected
- Federal workers in non-essential positions are furloughed (unpaid leave).
- Essential federal workers (e.g., law enforcement, border protection, air traffic controllers) work without pay during shutdowns but are paid retroactively.
- Government contractors and companies dependent on federal contracts can face financial hardship.
- Delays or halts in public services like passport processing, national parks maintenance, food safety inspections.
- Some safety and emergency services continue but may face disruptions.
Services That Continue
- Social Security, Medicare, and Medicaid payments continue without interruption.
- Military personnel remain active but may face delayed paychecks.
- Postal services continue as USPS operates independently of congressional funding.
- Critical public safety and national security work proceed.
Services Disrupted or Delayed
- Passport and visa processing may slow.
- National parks and museums may close or reduce services.
- Food assistance programs like WIC and SNAP may be affected if shutdown prolongs.
- FDA inspections and EPA environmental oversight typically halt.
- Various loan programs and federal housing assistance may be suspended.
Economic Impact
- A shutdown can reduce GDP and cause economic ripple effects beyond immediate government functions.
- Businesses dependent on government spending can experience reduced revenue and layoffs.
- Past shutdowns showed significant costs to taxpayers and the economy.
If a shutdown occurs, the first missed paychecks for federal employees and military members typically appear within weeks of the shutdown start.
