The U.S. federal government shutdown is starting to impact the nation’s economy, U.S. Treasury Secretary Scott Bessent said on Monday as the closure entered its 13th day.
“This is getting serious. It’s starting to affect the real economy,” he told Fox Business Network’s “Mornings with Maria” program, without offering more detail.
“We are having to shuffle things around. We are having to furlough workers here in DC and around the country,” Bessent said in the interview.
The U.S. federal government entered a shutdown on Oct. 1, after Congress failed to pass a budget or continuing resolution to fund operations for the new fiscal year. The shutdown was triggered by sharp political disagreements over health care funding, specifically Affordable Care Act subsidies, federal spending levels, and proposed rescissions to foreign aid and domestic programs.
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Roughly 1.6 million federal workers have been impacted, with approximately 900,000 furloughed and another 700,000 required to work without pay in essential roles, such as air traffic control, border protection, and military operations. As in previous shutdowns, Social Security, Medicare, and veterans’ benefits continue to operate, while most national parks, museums, and federal agencies offering discretionary services have closed or scaled back significantly. The Smithsonian museums and National Zoo in Washington, D.C., for example, are closed.
Economically, the shutdown is estimated to cost the U.S. about $400 million per day in lost productivity and delayed spending. Each week of continued closure could shave 0.1–0.2 percentage points off GDP growth. Delays in federal payments, contracts, and services are already affecting businesses and state-level operations.
Unusually, the Biden administration has indicated that back pay for furloughed workers is not guaranteed, a departure from past shutdowns. Additionally, some agencies have begun laying off employees rather than merely furloughing them, triggering legal challenges and union protests.
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Politically, the standoff is being driven by a deadlock between House Republicans, led by Speaker Mike Johnson, and Senate Democrats. Johnson has warned that this could become the longest shutdown in U.S. history, surpassing the 35-day shutdown of 2018–2019.
Negotiations remain stalled as of mid-October, and public frustration is rising. The shutdown’s duration and its broader economic and political impacts remain uncertain. Pressure is mounting on both parties to reach a resolution before long-term damage deepens.
Federal agencies are stretched thin, public institutions are closed, and uncertainty looms for both furloughed workers and the broader public. Treasury Secretary Bessent’s warning underscores the increasing pressure on policymakers to resolve the impasse.
With no clear path to resolution, public frustration is mounting, and calls for bipartisan cooperation are growing louder. The longer the impasse continues, the greater the strain on the systems and people that depend on functional governance, highlighting the high stakes of political brinkmanship in a divided Congress.