The Government Shutdown Cost The Economy $11 Billion

Stock Market News Today

The federal government shutdown cost the economy $11 billion

Ylan Mui | CNBC

The federal government shutdown cost the economy $11 billion, according to a new analysis from the nonpartisan Congressional Budget Office, reflecting lost output from federal workers, delayed government spending and reduced demand.

The report, which was released Monday, estimated a hit of $3 billion, or 0.1 percent, to economic activity during the fourth quarter of 2018. The impact was greater during the first quarter of 2019: $8 billion, or 0.2 percent of GDP.

government shutdown

Today’s Stock Market News

Although most of the damage to the economy will be reversed as the government re-opens and workers return to their jobs, the CBO estimated $3 billion in economic activity is permanently lost.

“Among those who experienced the largest and most direct negative effects are federal workers who faced delayed compensation and private-sector entities that lost business,” the report says. “Some of those private-sector entities will never recoup that lost income.”

The analysis does not incorporate some indirect effects of the shutdown, such as the halt in some federal permits and reduced access to loans. However, the report suggests that businesses were beginning to postpone investment and hiring decisions as a result of the shutdown and warned that the risks were becoming “increasingly significant” as the impasse dragged on.

Kocaso MX MX770 7-Inch 8 GB Tablet (Silver) – $55.63

The CBO’s annual report also looked at the impact of the administration’s trade policies on the economy. It estimates that new tariffs on imports and exports will shave an average of 0.1 percent from economic growth through 2029. It also forecast customs duties will rise from 0.2 percent of GDP in 2018 to 0.3 percent of GDP this year.

⇑⇓ Start Trading ⇓⇑ – CFD Service. 80.6% lose money

Overall, the CBO projected economic growth will slow this year to 2.3 percent, compared to the 3.1 percent rate last year, as the benefits of the new tax law begin to fade. Through 2023, growth is expected to average 1.7 percent, below the CBO’s estimate of the economy‘s potential.

Categories: Economic Indicators

Tags: , , , ,

7 replies


  1. Fed Signals Hold on Rate Increases. Officials voted to hold their benchmark rate steady for now – Today’s Stock Market News
  2. The Jobs Report Tops The List Of Important Economic News In The Week Ahead – Today’s Stock Market News
  3. U.S. New Home Sales At Seven-Month High – Today’s Stock Market News
  4. Disappointing U.S. Payrolls Report And Weak Chinese Export Data Add To Concerns About Global Economy – Today’s Stock Market News
  5. U.S. Retail Sales Unexpectedly Fell In February – Stock Market News Today
  6. New orders for U.S.-made goods fell modestly in February – Stock Market News Today
  7. Economic Growth Slowed In Second Quarter – Stock Market News Today

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: