- Shutdown costing U.S. economy roughly $15 billion per week, Hassett says
- White House memo projects 43,000 new job losses if shutdown lasts a month
- Economists warn of lower GDP growth and reduced consumer spending
- EY-Parthenon and CBO estimates show long-term economic damage
- Hassett insists U.S. economy remains strong despite short-term hit
The ongoing U.S. government shutdown is taking a steep economic toll, draining an estimated $15 billion from the nation’s output each week, according to White House economic adviser Kevin Hassett.
Speaking Monday on CNBC’s “Squawk Box,” the National Economic Council director cited a report from the Council of Economic Advisers showing that the federal closure could reduce U.S. gross domestic product (GDP) by roughly a tenth of a percent per week.
“My friends over at the Council of Economic Advisers gave me a report at the end of the week that said that it costs the U.S. GDP about $15 billion a week for a shutdown, or about a tenth of a percent of GDP,” Hassett said. “If the shutdown continues for a long time, then there are going to be a lot of things that don’t happen, and it will show up in the GDP number.”
A White House memo, obtained by Politico, projected that a monthlong shutdown could lead to an additional 43,000 people unemployed and reduce consumer spending by $30 billion. Those figures do not include the 1.9 million federal civilian workers who are currently furloughed or working without pay.
Economic analysts echoed those warnings. A report from EY-Parthenon estimated that the shutdown could reduce GDP growth by $7 billion per week, citing disruptions in federal pay, procurement delays, and declines in demand across key industries.
The Congressional Budget Office (CBO) offered similar caution, noting that the last major shutdown during President Trump’s first term slashed economic output by $11 billion, with $3 billion in losses that were never recovered. The CBO further estimates that 750,000 employees could be furloughed daily in a prolonged closure, costing the economy around $400 million per day.
Despite the grim projections, Hassett sought to reassure Americans about the broader economic outlook.
“The good news is the economy is booming,” he said, pointing to strong GDP figures and rising retail sales. “There’s a lot of good news out there, and I think the government shutdown, in the end, is just going to be a footnote in history. But the Democrats need to come to the table, get the government open, and then if they want to negotiate over something, they can.”
While the White House remains optimistic, economists warn that the longer the standoff drags on, the greater the risk to growth, employment, and consumer confidence. For now, the shutdown continues to strain government operations and weigh heavily on an otherwise resilient economy.
