Shutdown Could Cost $300 Million a Day

Oct 1, 2013 6:55pm
gty federal shutdown ll 131001 16x9 608 Shutdown Could Cost $300 Million a Day

(Frederic J. Brown/AFP/Getty Images)

WASHINGTON — The government shutdown comes with a hefty price tag — $300 million per day, according the economic consulting firm IHS Global Insight.

The figure translates to about $12.5 million an hour, or roughly $1.6 billion a week, while the government is closed.

The IHS analysis, shared with ABC News, accounts only for the lost wages and productivity from the nearly 800,000 furloughed federal workers. The calculation assumes an average annual salary per employee of $110,000 — essentially classifying that lost income as lost U.S. economic output (GDP) in the interim.

This is just one rough estimate, and an unofficial one at that. But it provides a ballpark look at the financial impact of the shutdown. The Government Accountability Office is closed today and unable to provide its analysis.

The Most Surprising Consequences of a Government Shutdown

How much did the last government shutdowns of 1995-96 cost us?

The Office of Management and Budget said at the time that the 26-day combined closure had a $1.4 billion price tag — or roughly $2.1 billion in today’s dollars, according to the Pew Research Center.

Needless to say, the bigger concern right now is the shutdown’s impact on the tepid economic recovery. IHS estimates a week-long shutdown would cut the 4th quarter economic growth rate by 0.2 percentage points, bringing its forecast of 2.2 percent growth down to just 2.0 percent.

SHOWS:
You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus