Who Gets Hit Hardest by a Government Shutdown?

By: Eliana Sagarin

Federal employees, vacationing families, future homeowners and tax payers are likely to be affected by the latest government shutdown so that includes just about everyone.

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Federal Employees

If you’re a federal employee, a government shutdown can have a huge knock-on effect on your paycheck. If everything goes according to plan, the government ends up paying the real price in the end. During the 16-day government shutdown in 2016, 850,000 federal employees were furloughed per day. When those employees came back to work, they were retroactively paid $2.2 billion according to the White House’s Office of Management and Budget, a significant loss in funds and lost productivity.

While government employees will likely be paid for their time in the end, there are many “essential” government employees who still have to go to work without compensation this holiday season. Homeland security, TSA agents and FAA flight controllers must show up during the year’s most hectic and stressful travel season.

If you’re going through an airport during the shutdown, an extra “thank you” to the government employees keeping us safe and moving can add some joy to someone’s difficult day.

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Much More than a Walk in the Park

Are you hoping to stroll through the majesty of a national park with your family this holiday season? Because many park employees will be furloughed during the shutdown, citizen access to the parks will be significantly restricted. Families who planned entire holiday vacations and road trips around visiting national parks, monuments and seashores have been forced to completely rethink their travel plans, losing thousands of dollars in the process.

Businesses such as hotels and restaurants that thrive on tourists visiting national sites might not be federal employees, but they might as well be “shut down” when parks aren’t fully operational – and they won’t get government reimbursement either

While parks like Yellowstone and Yosemite will remain open to the public, services like trash removal, restrooms, snow removal, and non-essential visitor centers would be closed

Seth Zaharias offers tours of Joshua Tree National Park in California through Cliffhanger Guides. He told The Guardian the effects of the shutdown will only truly be felt if the shutdown drags on beyond the holidays:

“It’s going to come down to environmental degradation. It’s going to be trash; it’s going to be human waste; it’s going to be people driving around on the land.”

 If you do take a little trip in a national park this season, bring along a garbage bag to clean up along the way and do your part to make sure the shutdown doesn’t degrade the environment.

How will the Government Shutdown Impact my Personal Finances?


During the 2013 shutdown, about 1.2 million people applying for a mortgage were delayed when the IRS couldn’t process their paperwork. If you’ve applied for an FHA loan recently, you can bet that, this winter, the government shutdown has grinded the process to a screeching halt. Your FHA application won’t be processed until non-essential government offices are up and running.

While the government shutdown is an inconvenience for most citizens, for those of you hoping to become homeowners in 2019, there’s a potential unexpected bonus: In anticipation of a slowing economy, mortgage interest rates might drop to attract more borrowers. If you see an attractive rate on a home loan, now is the time to leap at the opportunity.


During the 2013 government shutdown, $2.2 billion in tax refunds were delayed, but Washington policy analyst Raymond James for Marketwatch seems optimistic that it won’t be the case this time around, “It seems extremely unlikely a government shutdown will have an impact, especially as the issue likely gets resolved before most people will receive their W2s.” A delayed tax refund could have a deep impact on consumers who are anxious to pay off holiday debt and other expenses.

Perhaps this goes without saying, but the longer the shutdown, the greater the financial impact on the federal and individual level. Staying prepared and informed is the first step to ensuring this holiday government shutdown doesn’t leave you out in the cold.