The federal government shutdown has finally ended, and billions of dollars in federal funding are flowing again. While the economic impact of the six-week disruption was significant, experts say the long-term effects will be relatively modest.
During the shutdown, millions of Americans faced food insecurity, flight delays, and cancellations, leading to a decline in consumer sentiment. However, with Congress voting to restore funding, many federal employees are expected to receive back pay, and much of the harm is expected to be undone.
Maryland, which relies heavily on federal dollars for jobs and defense spending, has been particularly hard hit. Lawmakers must close a budget hole of $1.4 billion, and hundreds of thousands of federal workers were furloughed during the shutdown.
While some economists say the shutdown’s impact will be short-lived, others warn that it could have lasting consequences, particularly for small businesses and low-income families. “The business impact of SNAP cuts could be immediate and severe,” said Comptroller Brooke Lierman.
As the economy begins to rebound, experts caution that ripple effects remain. The loss of food assistance or a business missing out on a federal contract can have profound, localized consequences. Restaurants like Jersey Mike’s, which saw revenue decline by 20% during the shutdown, may struggle to regain footing in the coming months.
The impact of the shutdown will likely be felt for years to come, particularly for those who lost their jobs or are fearful of losing them. As Professor David Kass said, “But this is still, in many people’s lives, for those who lost their jobs or are fearful of losing their jobs, it is catastrophic.”
Source: https://www.thebanner.com/economy/ripple-effects/federal-government-shutdown-economic-impact-maryland-JJACIE4TKRD5LKZV2YWLU2C5FA