A U.S government shutdown is potentially on the horizon and hundreds of thousands of federal employees could soon feel its impact. The federal government will officially close as of 12:01 a.m. on Friday if lawmakers do not come to an agreement by the last day of the fiscal year (this Thursday).
This Congressional shutdown is looking more realistic since the blocking of a bill by senate republicans on Monday night. This said bill was set to not only suspend the debt ceiling, but also fund the government at their current rates.
“Every shutdown is different — there is a lot of discretion in the agencies about what they can continue to do,” said Marc Goldwein, senior policy director at the CRFB. “Everything that’s not essential has to stop, but there are different definitions of essential work.”
These questionable definitions bleed into the COVID-19 equation, wondering whether work on COVID-19 vaccines at the Food and Drug Administration and the Centers for Disease Control and Protection is deemed essential. On Tuesday, Pfizer released a statement claiming it had sent data to the FDA on its clinical trials for vaccinating children ranging from 5 to 12 years old.
While this would cause national parks to likely shut down, and mortgage and other loan applications would be delayed due to the inactivity of the IRS, federal services that are listed as essential, safety and national security from agencies like border protection and air traffic control, would resume regardless of a shutdown.
Ultimately, the strongest impact will be felt by hundreds of thousands of federal workers who are likely to be furloughed if a shutdown occurs.
“You have 2 million civilian employees that are working hard across the country,” Max Stier, president of Partnership for Public Service, said in a statement to news sources. “You have told all of them that there may be a shutdown — that means that they have to actually stop working on things like the [Montana] train crash or dealing with the economic calamity caused by the pandemic.”
This would be a full shutdown because Congress has yet to pass a single funding bill. The last closure was only a partial shutdown, which went from December 22, 2018, to January 25, 2019 (35-day record). This partial shutdown was responsible for a massive blow to economic growth at the time, causing an estimated loss of $3 billion in the last three months of 2018, according to a Congressional Budget Office estimate.
Committee for a Responsible Federal Budget projects that this full shutdown will almost certainly impact more federal workers than the prior partial shutdown in 2018.
In 2013, about 850,000 of 2.1 million non-postal federal employees were furloughed. In 2018, around 380,000 federal workers were furloughed.
Furloughed federal workers do not get paid during their time of separation, but would eventually receive back pay once the shutdown is concluded. While this alone is damaging to the federal workforce and their families, the lack of pay during the shutdown could have a wider economic impact.
“It’s not only the federal employee who suffers when there’s no paycheck on payday — their landlord doesn’t get paid,” American Federation of Government Employees public policy Director Jacqueline Simon said in a statement, “The credit card company doesn’t get paid, the utilities don’t get paid. They don’t go to the grocery store and buy groceries a lot.”
Fortunately, Social Security, Medicare and Medicaid are mandatory spending programs, which means they aren’t subject to annual appropriations.
The U.S. Postal Service, as in previous shutdowns, would continue its operations, as it does not depend on federal tax dollars for its operation. The shutdown however would likely slow down the transit of mail.
“Mail traveling the greatest distances will be most affected, with a day or two of transit time added for some first-class mail and periodicals,” USPS said.
Stay tuned this week for more updates on the impending shutdown, and become a member today to access everything we have to offer here at Federal Benefits Service.