The Ripple Effects of a Government Shutdown: What You Need to Know

Congress finds itself in a familiar predicament: on the verge of a government shutdown without a definitive strategy to avert it.

Legislators are racing to establish a path forward after President-elect Donald Trump and his adviser Elon Musk dismantled proposals to advance a bill to finance the government until March 14 due to the bill’s size and the breadth of its other clauses. The legislation also contained essential items such as funding for agricultural producers and areas affected by natural calamities.

Lawmakers have until midnight on Friday to avert a shutdown. If an agreement cannot be reached, here’s what may transpire:

Federal employees facing furloughs, unpaid leave

Federal employees classified as ‘essential’ would continue working but experience delayed compensation, right before the holiday season. Hundreds of thousands of federal workers would be put on furlough — effectively suspended from their jobs.

Federal agencies began informing their workers of potential furloughs on Friday, White House press secretary Karine Jean-Pierre informed reporters.

“We believe there is still an opportunity for Congress to avert a partial shutdown,” Jean-Pierre stated. “However, in the interest of prudent preparation, we want to exercise caution here; agencies did start alerting their personnel of the possible furloughs today at noon.”

Agencies last revised their shutdown plans in the autumn of 2023. These plans specify how many employees would be furloughed in the event of a shutdown, and how many are exempt, such as jobs deemed vital for safety or related to the president’s constitutional duties and authority.

Some furloughs initiate only if a shutdown endures beyond five days.

“A government shutdown would deliver a catastrophic impact on diligent federal employees and the millions of citizens who depend on vital government services,” remarked Everett Kelley, president of the American Federation of Government Employees, which represents 800,000 civilian federal workers. “Over 642,000 of them are veterans of our armed forces. Allowing them to be without a paycheck during the holidays is intolerable.”

All active-duty military personnel remain on duty, but the Department of Defense employs more than 700,000 civilian workers, many of whom would be furloughed during a shutdown.

Most employees at scientific agencies like the National Institutes of Health would also face furloughs.

In prior shutdowns, the IRS prepared for approximately two-thirds of its personnel to be furloughed, meaning the agency ceased to respond to taxpayer inquiries or audit tax returns.

Federal contractors who are not directly employed by the federal government would go unpaid. While federal employees typically receive backpay once the government reopens, contractors do not. Those contractors include janitorial staff, food service employees, and other support personnel.

Closures, delays, and disruptions

Other alterations to anticipate during a shutdown comprise:

• Closure of national parks and museums, as has been the case during earlier shutdowns
• Delay in federal lending to businesses and individuals attempting to purchase homes
• A halt to new Pentagon contracts, although the Pentagon could still place orders for necessary supplies to safeguard national security
• Disruptions to Head Start, which provides education for 3- and 4-year-olds nationwide, and Meals on Wheels, which delivers food to elderly individuals. Last year, the White House announced that 10,000 children from low-income families would lose access to the Head Start program if a shutdown occurred
• No new loans from the Small Business Administration

Critical government operations continue

• Social Security beneficiaries would still receive monthly disbursements
• Medicare and Medicaid benefits would persist, but there could be delays in processing new applications
• Veterans would continue to obtain benefits
• The Supplemental Nutrition Assistance Program and other nutrition initiatives would carry on but might face interruptions during a prolonged shutdown
• Federal law enforcement bodies, such as the FBI, would remain operational
• Air traffic and airport staff would still report to duty, even if unpaid unless employees start calling in sick to work — as witnessed during the last shutdown
• Members of Congress would continue receiving salaries, but non-essential staff would be furloughed
• Postal services would remain active
• Automated tax collection would carry on