The partial U.S. government shutdown is affecting more than government workers and contractors. While they are not getting paid—even though some of them are getting called in to work anyway—industries that rely on government permit approvals and data collection, and those that do business with now unpaid federal employees are feeling the stress as well.
According to The Hill, “The partial government shutdown has injected a fresh dose of uncertainty into an increasingly complicated economic landscape for the U.S.”
Writer Sylvan Lane cites:
Weaker consumer and business sentiment: “Furloughed employees and sidelined government contractors are looking for alternative ways to pay their bills and curtailing discretionary purchases.”
No government economic data: “Economists have been deprived of a massive trove of federal data that’s published on an almost-daily basis by the Commerce Department…. The department collects and analyzes figures measuring gross domestic product, price increases, wage growth, retail sales and international trade metrics that economists, traders and policymakers rely on for their analyses.”
Stress on financial sector: “Banks and credit unions are scrambling to help unpaid federal workers by deferring mortgage payments, offering free or low-cost loans and extending overdraft protections. Industry leaders say the financial sector can shoulder the burden for now, but lenders could face difficult choices if the shutdown rambles into February.”
SEC and SBA: “Some smaller firms are struggling to stay afloat without promised loans from the Small Business Administration, which is closed during the funding impasse. Meanwhile, larger corporations and startups are unable to file stock offerings and other mandated paperwork with the Securities and Exchange Commission (SEC) until the government fully reopens.”
More economic uncertainty amid global fears: “…analysts fear that an economic slowdown in China and emerging markets could weigh on the American economy.”
