As the federal government inches closer to another shutdown, the D.C. region is in a precarious position — a point that economic experts said is unlike any previous shutdown.
“I don’t think we’ve seen anything like this before. So no, this is in many respects unprecedented. We’re charting new territories,” said Terry Clower, director of the Center for Regional Analysis at George Mason University.
Clower pointed to a troubling convergence of factors: 18,000 federal jobs lost this year, a decline of 8,500 jobs in professional and business services and a sluggish tourism sector. These stressors, he said, make the region especially vulnerable.
“All of these things make this to where the impact of the shutdown will be felt more severely,” he said.
While federal employees typically receive back pay after shutdowns, contractors and service workers often do not. Many are still recovering from earlier rounds of government cutbacks.
“If they’re in survival mode now, it’s going to make surviving even harder because they may not have those cash reserves,” Clower said.
What makes this shutdown different, Clower added, is the uncertainty stemming from messaging by the Office of Budget Management, which he said is suggesting the shutdown could be used as a pretext for mass firings.
“It makes it just a lot more uncertain about how long it would last, and what the net impacts would be on the federal workforce.”
If layoffs do occur, they could further strain the job market. For those workers let go, finding another job won’t be easy and retraining programs often only kick in after formal unemployment, leaving many in limbo.
“It’s not just like you can stop being an administrator in the federal government and just go find a job that’s equivalent in the private sector,” Clower said.
The shutdown could also impact community organizations and nonprofits. Clower warned it may push more residents into financial stress and food insecurity, with already limited resources available to help.
“This is going to put some more people into financial stress … and how do we respond to the need? Because, again, we don’t know exactly how it’s going to play out,” he said.
As Congress remains gridlocked, Clower said the region is bracing for impact while still hoping for a swift resolution.
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