Government Shutdown Impact on Sectors - A partial government shutdown could disproportionately impact the defense and healthcare sectors due to potential delays in government contracts and approvals necessary for drug development [3] - Historically, most government shutdowns last only a few days, resulting in minimal impact on these sectors [4] Economic Growth Implications - A partial government shutdown may dampen economic growth as federal workers are not paid during the shutdown, leading to reduced household spending [5] - Current estimates for economic growth remain robust, with the Atlanta Fed's GDPNow model predicting over 3% annualized growth and the New York Fed's Nowcast estimating 2.5% [5] Essential Government Functions - Many essential government functions, such as Medicare, Social Security, and the U.S. Postal Service, will continue to operate during a shutdown, limiting the overall impact on essential services [6] Potential Layoffs - The Office of Management and Budget may consider additional layoffs during a shutdown, particularly in programs with discretionary funding lapses [8] Future Expectations - Prediction markets currently view a partial government shutdown as likely, with its duration being a critical factor for economic impact [9][10]
As Government Shutdown Risk Looms, Here's The Likely Market Impact
Forbes·2025-09-29 16:40