The National Council on Compensation Insurance (NCCI) published a new brief that explores the potential impacts of the 2025 shutdown on the economy and on workers’ compensation.

Comparing government shutdowns to natural disasters, the NCCI noted that government shutdowns impact certain people, locations, and industries more than others. Also, like natural disasters, the immediate negative impacts at the micro level are often short-lived and can reverse after the fact, resulting in only minor impacts to the economy on a macro level.

After the 2018 government shutdown, real GDP decelerated in the 4th quarter while workers were furloughed and paychecks held. But GDP immediately rebounded in the first quarter of 2019 upon resolution of the shutdown. Consumer spending likewise declined sharply in December 2018 before rebounding in early 2019, fully recovering from the decline by March 2019. Additionally, no lasting impact can be seen in the data as consumer spending and economic growth continued to accelerate throughout the year.

The timing of the 2025 shutdown is also noteworthy because the resolution came early enough in the quarter (November 12) that official statistics may not show as large of an impact on the economy as we saw in 2018. With back pay checks reaching workers and disruptions to travel diminishing ahead of the important holiday period, the economic impact of the shutdown may be concentrated within a single quarter and be even less visible in the data.

Although the 2025 government shutdown was the longest in history, the NCCI has concluded that for workers comp the temporary furloughing of workers with collected back pay has minimal impacts on employment and wage trends.