White House analysis: NYS economy will lose $1.2 billion each week of shutdown

WASHINGTON — White House economic advisers are warning that New York State could lose $1.2 billion of economic activity for each week the U.S. government remains shut down — or $5.3 billion per month.

Unemployment in the state would jump by about 2,600 workers a month, according to an analysis by The Council of Economic Advisers, an agency that advises the president. A fact sheet also notes there are around 115,000 federal workers in New York, or about 1.2% of the state workforce, and most federal workers will be furloughed or required to work without pay.

"CEA analysis indicates that a shutdown may have wide-ranging economic effects that reduce the prospects of New York constituents through lower growth, higher unemployment and disruptions to Social Security and nutritional support to women with infant children," the impact sheet states.

Friday was the third day federal agencies have been shut down, and there remained no sign of any imminent reopening. Competing spending bills from Republicans and Democrats to restart funding for the government both failed to advance in the Senate, each for the fourth time.

Asked for a response to the White House’s shutdown damage projection, Senate Minority Leader Chuck Schumer’s office pointed out the Trump administration announced this week it had frozen $18 billion in funding for two major infrastructure projects in New York City — which has potentially significant impacts on the city's economy, construction jobs and commuter transit.

“The government remains closed,” Schumer (D-N.Y.) emphasized on the Senate floor earlier in the day, “because Donald Trump and Republicans insist on raising Americans’ health care premiums and kicking millions off their insurance.”

Rep. Nick LaLota (R-Amityville) accused Democrats of gambling with the economy to score points.

"The president’s economic team is right — every week of a shutdown costs New York billions and puts thousands of jobs at risk," LaLota said.

Other projected impacts of a prolonged shutdown on New York State listed by the council include:

• Funding reserves for the Women, Infants and Children program could run out by the end of the first week of the shutdown, becoming reliant on "very limited local contingency funding." In New York, there are approximately 438,000 WIC recipients who rely on the program for nutritional support for themselves and their children, the CEA states.
• Supplemental Nutrition Assistance Program benefits will continue through October but could be disrupted in a prolonged shutdown. In New York, there are around 2,963,000 total enrollees in SNAP, and an estimated 1,150,000 whom are children. ;
• Social Security benefits are likely delayed for those that get their money by check instead of direct-deposit, the CEA states. In New York, there are approximately 25,600 seniors that receive their benefits by check.
• Small businesses would face delays worth about $140 million under a monthlong shutdown of the federal government.

"Combining this with federal employees going unpaid, consumer spending from lost wages will fall by an estimated $1.2 billion in New York each month the government shut down extends," the document states.