The Congressional Budget Office (CBO) reports that the ongoing government shutdown, lasting nearly a month, will permanently reduce U.S. GDP by at least $7 billion due to irrecoverable lost productivity from furloughed federal employees. This figure could rise to $11 billion if extended two more weeks or $14 billion if until November 26. While most economic effects—like delayed paychecks totaling $9 billion so far (potentially $23 billion after four more weeks) and $24 billion in postponed agency spending—will largely reverse upon reopening, the non-recoverable output loss will have lasting impacts. CBO estimates a 1% GDP dip this quarter, followed by a 1.4% rebound next quarter. The report assumes furloughed workers will receive back pay, contradicting the Trump administration's position, as echoed by legal experts and a Justice Department attorney in court.
Read more: https://www.govexec.com/workforce/2025/10/shutdown-furloughs-will-permanently-cost-economy-least-7-billion-cbo-says/409156/
