What Happens During a Government Shutdown? Shocking Impacts on Workers, Services, and the Economy
Discover what happens during a government shutdown, how it affects federal workers, public services, travel, education, and the U.S. economy, with the latest updates from the 2025 shutdown crisis.
The United States is once again facing a government funding crisis, raising the critical question: what happens during a government shutdown? While the term may sound like a temporary pause, its effects ripple through nearly every sector of American life. From furloughed workers and stalled public services to delayed paychecks and travel disruptions, the reality of a shutdown is both disruptive and deeply personal. The current 2025 shutdown has introduced new layers of uncertainty, with the White House even signaling possible permanent layoffs—a move that intensifies both political battles and economic anxiety.
What Happens During a Government Shutdown at the Federal Level
When Congress fails to approve a budget or temporary funding, federal agencies are legally prohibited from spending money on non-essential functions. That means government departments must classify employees into two categories:
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Excepted (essential): Workers who must continue critical duties such as national security, law enforcement, and air traffic control, often without pay until funding resumes.
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Non-excepted (non-essential): Workers who are furloughed, meaning they are placed on unpaid leave and cannot work.
The scope of disruption varies by agency, but the pattern is clear—daily operations slow down, paychecks are delayed, and many public services halt.
Federal Workers on the Frontline of a Shutdown
Temporary Furloughs vs. Permanent Cuts
Traditionally, shutdowns have resulted in furloughs with a guarantee of back pay once the government reopens. However, in this year’s shutdown, agencies were instructed to prepare “reduction in force” plans, which could mean permanent layoffs for some non-essential positions. This marks a dramatic shift and has triggered lawsuits from labor unions challenging the legality of these threats.
Financial Strain on Households
The Congressional Budget Office estimates that up to 750,000 federal employees could be sidelined each day, with a staggering $400 million in lost compensation piling up as the shutdown continues. Even for those still working, paychecks are delayed, pushing many families into financial stress.
Key Facts for Workers
| Impact Area | Effect During Shutdown |
|---|---|
| Paychecks | Delayed until funding resumes |
| Job Security | Furloughs, with risk of permanent layoffs |
| Retroactive Pay | Guaranteed by law, but only after funding is restored |
What Happens During a Government Shutdown to Public Services
Health and Research
Agencies like the CDC and NIH face major staff furloughs, with up to 75% of employees placed on leave. This stalls medical research, slows disease monitoring, and limits oversight. Programs such as Medicare and Medicaid, however, remain active due to mandatory funding.
Education and Student Aid
Around 87% of the Department of Education workforce is expected to be furloughed, delaying grants and investigations. Loan servicing continues, but new initiatives are frozen.
Aviation and Travel
Travelers feel the pinch as the FAA prepares to furlough 11,000 employees. Air traffic controllers and TSA workers continue on the job but without pay, creating stress and potential staffing shortages that could lead to delays.
National Parks and Public Lands
While many parks remain open, staffing is severely reduced. Fee revenue is being used to support minimal operations, but services like trash collection and facility maintenance are suspended, raising concerns about visitor safety and environmental damage.
Programs That Continue vs. Programs That Halt
To make sense of the chaos, here’s a breakdown of what continues and what stops during a shutdown:
| Continues | Halted or Reduced |
|---|---|
| Social Security checks | Federal museum operations |
| Medicare and Medicaid services | Education grants and investigations |
| Veterans’ benefits | Food safety inspections |
| Law enforcement, military operations | Federal courts and immigration hearings (partially delayed) |
Broader Economic and Political Consequences
Ripple Effects on the Economy
Shutdowns don’t just affect federal workers—they ripple into local economies, especially in cities with large government workforces. Lost wages mean reduced spending, hurting businesses from restaurants to retailers. The travel industry alone could lose nearly $1 billion per week due to flight delays and tourism setbacks.
Political Fallout
Public opinion surveys show that a majority of Americans oppose shutdowns, blaming both parties for gridlock. This time, the administration’s push for permanent cuts has escalated tensions, with Democrats and labor unions challenging the move in court.
Why Duration Matters
The length of a shutdown is key. A short lapse may cause inconvenience, but as days turn into weeks, the damage spreads—backlogged court cases, stalled research projects, halted infrastructure repairs, and declining public confidence in government stability.
What Happens Next
The only way out is for Congress to pass a continuing resolution or full appropriations bills. Until then, agencies will run on contingency plans, and millions of Americans—from federal employees to travelers and students—will be left navigating the uncertainty of a government shutdown that feels far more disruptive than ever before.
