A ‘disaster’ nears: Millions of federal workers’ paychecks would be on hold in a shutdown

More than 38K civilian federal employees work in Colorado

By: - September 20, 2023 8:02 pm

A view of the U.S. Capitol, April 4, 2023. (Jennifer Shutt/States Newsroom)

WASHINGTON — More than 3.5 million federal employees and military personnel — many in the Washington, D.C., area but also scattered across the states and around the globe — are bracing for another partial government shutdown, as U.S. House Republicans struggle to produce a short-term plan to fund the government past the end of the month.

Most of the workers will be furloughed and go without paychecks in a shutdown. Some will have to work without pay because of the nature of their jobs, like members of the military, law enforcement officers, air traffic controllers and TSA officers. Those federal employees would get back pay once the shutdown ends under a law enacted in January 2019.

Lawmakers would not be personally affected — members of Congress would continue to get paid, as well as President Joe Biden and federal judges, though the judicial branch could see its funding run low.

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In the D.C. area, Virginia is home to an estimated 140,000 civilian federal workers, who for some unknown period would go without pay and would be forced to draw on savings or other assistance, according to a federal employee database. Maryland has an estimated 139,000 civilian employees.

The economic impact could be broad, because the funding lapse this year would hit much harder than the 35-day partial government shutdown that took place during the Trump administration and reduced GDP by billions of dollars. This time, a partial shutdown would affect more than 1.4 million uniformed members of the military and 1 million additional civilian federal employees at the Pentagon, Department of Health and Human Services and several other agencies, as well as congressional staff.

Speaker Kevin McCarthy, a California Republican, has repeatedly warned his own members against forcing a funding lapse, saying it won’t help the party to achieve its goals.

But that hasn’t stopped especially conservative Republicans from halting work on full-year spending measures and opposing the short-term stopgap bill that’s needed to give lawmakers more time to work out a deal.

American Federation of Government Employees National President Everett Kelley said in a written statement that a “government shutdown would be a disaster for the American people and the federal employees who keep our government running.”

“Shutdowns hurt local communities across the country, deny Americans access to government services, and do significant damage to the overall economy,” Kelley said.

Congress, Kelley said, “needs to do its job and pass a continuing resolution to keep the government funded at current levels while continuing to negotiate a final budget. Nothing less is acceptable.”

AFGE represents more than 750,000 federal and D.C. government employees.

Here’s a look at why the federal government might shut down by Oct. 1, what agencies are impacted and what isn’t affected.

Why would the government have to shut down?

Congress is supposed to pass 12 government funding bills each year before the start of the new fiscal year on Oct. 1, but lawmakers haven’t completed all of their bills on time since 1996.

Instead, every year the House and Senate pass at least one stopgap spending bill, or continuing resolution. This keeps funding levels and policy mostly flat for a few weeks or a couple of months, giving the Appropriations committees more time to work out bipartisan bills and for leaders to hold floor votes.

Congress sometimes has to pass several short-term funding bills lasting for months, or even the entire fiscal year, if agreements on new, full-year spending bills can’t be negotiated.

If Congress doesn’t approve all dozen full-year government funding bills, or pass a short-term stopgap bill, by midnight on Sept. 30, then a funding lapse begins and government departments begin implementing a partial shutdown.

What happens during a shutdown? 

Federal civilian employees are broadly categorized as either “excepted” or “non-excepted.” During a partial government shutdown, excepted federal workers continue to work without pay while everyone else is furloughed — which means they are on an enforced vacation and their pay is on hold until the government resumes operations.

Employees that deal with “the safety of human life or the protection of property” often work without pay until Congress approves some sort of spending measure.

What federal departments and agencies are involved? 

Any federal department or agency without a full-year appropriations bill would need to implement its shutdown plans if Congress doesn’t approve a spending bill before Oct. 1.

Congress has yet to pass any of its dozen annual funding bills for fiscal 2024, so all of the departments and agencies funded through the annual appropriations process would be impacted.

That includes the departments of Agriculture, Commerce, Defense, Education, Energy, Health and Human Services, Homeland Security, Housing and Urban Development, Interior, Justice, Labor, State, Transportation, Treasury and Veterans Affairs.

Smaller federal agencies would also be affected, including the Environmental Protection Agency, Food and Drug Administration, NASA and the Smithsonian Institution, among dozens of others.

The entire legislative branch, including the U.S. House, U.S. Senate, the Capitol Police, the Congressional Budget Office, Government Accountability Office and the Library of Congress, among others, would be partially shut down.

Each department and agency has its own guidance for implementing a partial government shutdown, which is posted on the Office of Management and Budget’s website.

What federal operations escape?

Spending on mandatory programs like Medicare, Medicaid and Social Security does not go through the annual appropriations process, so those three programs are mostly exempt from the impact.

How many federal employees would be furloughed?

The federal government employed just under 2.2 million civilian employees earlier this year, according to its database. There are another 1.4 million members of the U.S. military, according to numbers from the Office of Management and Budget. The Legislative Branch employs more than 31,000 employees and the judicial branch has about 33,000 employees.

About 745,000 of the civilian employees work for the Department of Defense, with another 449,000 at the Veterans Affairs Department. The Department of Homeland Security — which houses Customs and Border Protection, Immigration and Customs Enforcement, and the Federal Emergency Management Agency — employs more than 216,000 federal employees.

A state-by-state breakdown of where civilian federal employees work shows that the nation’s capital has the most federal employees, with 161,000 working in the District of Columbia.

California has the second-highest population of civilian federal employees with 142,000. Texas holds nearly 123,000. Colorado has 38,089.

More than 636,000 federal employees are veterans.

Federal employees will get back pay after the shutdown ends, though that hasn’t extended to federal contractors.

Does anyone get paid during a partial government shutdown?

Yes. The president, members of Congress and judges.

Article II, Section 1 of the Constitution “forbids the salary of the President to be reduced while he or she is in office, thus effectively guaranteeing the President of compensation regardless of any shutdown action,” according to the Congressional Research Service.

Members of Congress would receive pay for several reasons, including that they have a permanent appropriation for their salaries, a section of the Constitution addressing lawmakers’ pay and the 27th Amendment, according to the Congressional Research Service.

Article I, Section 6 of the Constitution says that U.S. lawmakers “shall receive a Compensation for their Services, to be ascertained by Law, and paid out of the Treasury of the United States.”

And the 27th Amendment notes that “No law, varying the compensation for the services of the Senators and Representatives, shall take effect, until an election of Representatives shall have intervened.”

Judges and the judiciary would “likely be able to continue to operate for a limited time using funds derived from court filings and other fees and from no-year appropriations,” according to a report from CRS.

How many funding lapses have there been?

Congress has failed to fund the government three times since 2000.

In 2013, there was a 16-day shutdown amid calls from several hardline Republicans, including Texas Sen. Ted Cruz, to defund the Affordable Care Act, or Obamacare.

While none of the 12 full-year government funding bills were law when that shutdown began, it didn’t fully impact the Pentagon.

Just before the funding lapse began, Congress passed a bill to provide pay for troops, Defense Department civilian employees and certain contractors working for either the Defense Department or the Homeland Security Department, according to the Congressional Research Service.

There were two funding lapses during the Trump administration, one of which was relatively short and one that lasted for 35 days.

The 35-day partial government shutdown began after five of the dozen annual spending bills became law, reducing the number of federal employees and operations impacted.

The Departments of Defense, Education, Energy, Health and Human Services, Labor and Veterans Affairs weren’t affected. Congress also wasn’t impacted, having passed its own funding bill.

What is the economic impact of a partial government shutdown?

Federal employees were furloughed for a total of 6.6 million days during the 2013 partial government shutdown, bringing the total “lost productivity” to about $2 billion, according to an analysis from the White House budget office.

The 2019 partial government shutdown reduced real gross domestic product by $3 billion during the fourth quarter of 2018 and by $8 billion during the first quarter of 2019, according to analysis from the nonpartisan Congressional Budget Office.

That shutdown, CBO said in its report, “dampened economic activity mainly because of the loss of furloughed federal workers’ contribution to GDP, the delay in federal spending on goods and services, and the reduction in aggregate demand (which thereby dampened private-sector activity).”

What’s the Biden administration saying?

The White House released a memo Wednesday rebuking House Republicans for approaching the end of the fiscal year without a bipartisan plan to fund the government.

The administration said it’s clear that “if extreme House Republicans fail to ram through their radical agenda, they plan to take their frustration out on the American people by forcing a government shutdown that would undermine our economy and national security, create needless uncertainty for families and businesses, and have damaging consequences across the country.”

The memo says a funding lapse could affect dozens of federal programs, including eliminating some spaces in Head Start, slowing down new loans at the Small Business Administration and forcing the FDA to “delay food safety inspections for a wide variety of products all across the country.”

The Occupational Safety and Health Administration, or OSHA, could have to reduce the number of inspections, “denying workers a key protection against safety risk, and Americans who are owed back pay for their hard work would face delays due to the majority of Department of Labor investigations being suspended.”

Air travel could also be impacted since TSA employees and air traffic controllers would be working without pay, the White House memo says.

“These consequences are real and avoidable — but only if House Republicans stop playing political games with peoples’ lives and catering to the ideological demands of their most extreme, far-right members,” the White House memo says. “It’s time for House Republicans to abide by the bipartisan budget agreement that a majority of them voted for, keep the government open, and address other urgent needs for the American people.”

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Jennifer Shutt
Jennifer Shutt

Jennifer covers the nation’s capital as a senior reporter for States Newsroom. Her coverage areas include congressional policy, politics and legal challenges with a focus on health care, unemployment, housing and aid to families.

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