US shutdown will cost $15bn of GDP each week - Politico

GDP will shrink by 0.1% each week of the government shutdown

American edition Politico reports that, according to White House estimates, the long US government shutdown will cause losses to the economy of about 15 billion dollars a week. This amounts to approximately 0.1% of the country's GDP.

Who will suffer the most

• Federal employees - More than 1.9 million people may be left without pay or go on forced leave.

  Read also:

  1. Rheinmetall's new plant in Ukraine: what we know The German defence company Rheinmetall has announced the construction of a new plant for the production of artillery shells in the territory of...

• Government contractors, whose activities will be frozen indefinitely.

• Aviation industry, where flight delays and staff reductions are already causing disruption.

• Social programmes (WIC, Head Start, Medicare), whose funding may be suspended.

Economic consequences

• Each month of the shutdown - about 43 thousand unemployed.

• Consumer spending is expected to fall by 30 billion dollars.

• Half of the losses are related to the incomes of civil servants, and the other half are due to the «chain reaction» effect in the economy.

• The risk of a downgrade of the US credit rating and a decline in investment confidence.

The political dimension

The shutdown continues due to the lack of agreement in Congress on the budget.

• Some federal agencies have already been instructed to prepare for massive staff redundancies.

• Government workers' unions filed lawsuits accusing the administration of unlawfully demanding that they work without pay.

• Experts stress that a protracted conflict could lead to a systemic crisis in the public sector.