EY‑Parthenon: Shutdown Could Cost $7B Per Week, CBO: $400M/day in Furloughed Pay
With funding set to lapse Oct. 1, 2025 if no deal is reached, EY‑Parthenon chief economist Gregory Daco estimates each week of a shutdown could shave about 0.1 percentage point off GDP and cost roughly $7 billion. The Congressional Budget Office says the government would pay about $400 million per day in back pay to furloughed employees once funding resumes — a reminder that roughly 800,000 workers missed pay in the Dec. 2018–Jan. 2019 shutdown, which trimmed about $11 billion from GDP.
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🔍 Key Facts
- Funding deadline: federal funding expires Sept. 30, 2025; funding could lapse on Oct. 1, 2025.
- EY‑Parthenon chief economist Gregory Daco estimates each week of a government shutdown would cost roughly $7 billion and shave about 0.1 percentage point off GDP growth.
- The Congressional Budget Office (CBO) estimates the federal government will pay roughly $400 million per day in back pay to furloughed employees once funding resumes.
- Historical precedent: the Dec. 2018–Jan. 2019 shutdown left about 800,000 federal workers unpaid and reduced U.S. GDP by roughly $11 billion overall.
- The key estimates and projections cited come from EY‑Parthenon (Gregory Daco) and the CBO, as reported by CBS MoneyWatch and CBS News.
📰 Sources (2)
How much could a government shutdown cost the economy and taxpayers?
New information:
- EY‑Parthenon chief economist Gregory Daco’s estimate that each week of the shutdown could cost about $7 billion and shave 0.1 percentage points off GDP growth
- CBO estimate cited that the federal government will pay roughly $400 million per day in back pay for furloughed employees once funding resumes
- Contextual consolidation of prior CBO finding that the 2018–19 shutdown reduced GDP by about $11 billion overall
Here's what economists say about the impact of a government shutdown
New information:
- Shutdown deadline: Sept. 30, 2025; funding could lapse Oct. 1, 2025
- Economic cost estimate: roughly $7 billion per week (Gregory Daco, EY‑Parthenon)
- Labor impact precedent: about 800,000 federal workers missed pay during the Dec. 2018–Jan. 2019 shutdown