"About 1.25 million federal workers haven't been paid since Oct. 1. Thousands of flights have been canceled, a trend that is expected to continue this week even as Congress moves toward reopening the government. Government contract awards have slowed and some food aid recipients have seen their benefits interrupted. Most of the lost economic activity will be recovered when the government reopens, as federal workers will receive back pay."
""Short-lived shutdowns are usually invisible in the data, but this one will leave a lasting mark," Gregory Daco, chief economist at accounting giant EY said, "both because of its record length and the growing disruptions to welfare programs and travel." The Congressional Budget Office estimated that a six-week shutdown will reduce growth in this year's fourth quarter by about 1.5 percentage points."
About 1.25 million federal workers went unpaid since Oct. 1, and thousands of flights were canceled with more disruptions expected even as lawmakers move to reopen the government. Government contract awards slowed and some food aid recipients experienced interruptions in benefits. Most lost activity should be recovered via back pay, but some canceled travel, missed consumer spending, and postponed purchases will be permanently lost. A six-week shutdown is estimated to reduce fourth-quarter growth by about 1.5 percentage points and erase roughly $11 billion in economic activity. The shutdown compounds sluggish hiring, elevated inflation, and tariff-driven uncertainty, though few economists foresee a recession.
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