WASHINGTON (AP) — At this time of year, John Sprinkle and his wife would normally be planning their summer vacation. Not now. Sprinkle, a furloughed federal employee, is about to miss his second paycheck since the partial government shutdown began just before Christmas.
With no end in sight to the longest shutdown in American history, Sprinkle and his family are postponing all manner of spending.
“We were thinking of getting a new computer, but that’s not going to happen,” he said. “We’re not really eating out like we normally would be. We are not going out to events like we would be.”
Multiply those decisions by 800,000 federal employees across the country and hundreds of thousands of government contractors who aren’t being paid either, and the shutdown looms as an accelerating threat to the wider economy.
The shutdown’s biggest effect on the economy is likely to be the cutback in federal spending. But consumer spending, which is critical to growth, is another important factor.
When government employees spend less, stores and restaurants that serve them suffer. So do landlords and lenders that do business with federal workers. Though spending and growth will rebound once the government reopens, most of the restaurant meals missed and hotel stays canceled will never be made up.
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