The Longer It Lasts, the More a Shutdown Could Hurt the Economy<br />A separate report from the Bureau of Economic Analysis, part of a larger analysis by the Congressional Research Service, found<br />that lost hours worked by federal employees over the two weeks of the shutdown in 2013 accounted for a 0.3 percentage point drop in quarterly growth — by themselves.<br />As a whole, shutdowns cost the economy at least 0.1 percentage point of growth per week,<br />and probably much more, the Congressional Research Service surmised in a report in 2014.<br />“A shutdown affects not only Washington and its employees,<br />but also has ripple effects across sectors throughout the country — from shopping malls to national parks, from contractors to hotels,” said Beth Ann Bovino, chief United States economist at S.&P.<br />President Trump’s Council of Economic Advisers estimates<br />that every week of furloughing federal workers would reduce annual economic growth by 0.2 percentage point.<br />The longer the government is shut down, the bigger the economic impact — and this time, the bigger the chances<br />that the economy’s recent growth spurt could stall, at least temporarily.<br />A 16-day shutdown in October 2013, for example, may have cost $20 billion in output, cutting 0.5 percentage point<br />off the annualized economic growth rate in the fourth quarter, according to the securities rating firm Moody’s.<br />“We face a very real risk of a national hiring hesitation, with recruiters putting plans on hold,<br />and job movers opting to sit tight for the foreseeable future,” said Doug Monro, a founder of the global job search engine Adzuna.
