FILE- In this Monday, Jan. 14, 2019, file photo security lines at Hartsfield-Jackson International Airport in Atlanta stretch more than an hour long amid the partial federal shutdown. As the partial government shutdown moves through its fourth week with no end in sight, the economic blow is being felt not only by federal workers but also by business people, households and travelers across the country. (John Spink/Atlanta Journal-Constitution via AP, File)WASHINGTON – Delta Air Lines can’t get eight new aircraft in the air. Roughly a million government employees and contractors aren’t being paid. Some Americans who are trying to start small businesses face delays in obtaining the required tax identification number from the IRS.
As the partial government shutdown moves through its fourth week with no end in sight, the economic blow is being felt not only by federal workers but also by business people, households and travelers across the country. And while the hit to the overall economy so far remains slight, economist foresee real damage if the shutdown drags into February or beyond.
“Even if the shutdown is over by the end of the month, the hit to growth will be material,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a research note.
Shepherdson projects that after growing for nearly 10 years, the economy might even contract in this year’s first quarter if the shutdown lasts through March. Other forecasts are less dire. Mark Zandi, chief economist at Moody’s Analytics, thinks that if the shutdown extends that long, the economy would slow by 0.5 percentage point but would remain on solid footing.
On Tuesday, Kevin Hassett, a top economist in the White House, acknowledged that the shutdown was weighing on the economy more than he had previously estimated. Hassett, chairman of the Council of Economic Advisers, said the White House now calculates that annual growth is slowing by about 0.1 percentage point a week.