Goldman Forecasts Mid-November End to Government Shutdown

An end to the government shutdown could be in sight, according to Goldman Sachs.

Increasing operational and political pressures could push lawmakers to striking a compromise, an analysis by the Wall Street bank said, per a report Monday (Nov. 3) by Seeking Alpha.

The analysis said that while the shutdown’s end is unpredictable, Goldman anticipates it to most likely conclude around the second week of November. Pressure could mount amid missed paychecks for air traffic controllers and airport screeners, which could cause air travel delays, especially before the second pay date in November.

The failure to pay food stamps benefits on time and the Nov. 7 congressional recess deadline could also help drive the agreement, Goldman analyst Alec Phillips said. Assuming the shutdown persists through Tuesday (Nov. 4) night, it will be the longest in U.S. history.

“The current shutdown looks likely to have the greatest economic impact of any shutdown on record. Not only is it likely to run longer than the 35-day partial shutdown in 2018-2019, it is much broader than prior lengthy shutdowns, which affected only a few agencies,” Phillips said.

If the shutdown does end in mid-November, Goldman expects the release of the September employment report a few days after reopening, though the November employment report may not arrive until early or mid-December. Phillips added that inflation data could also be delayed.

The report came days after the U.S. Chamber of Commerce said that the impasse over the shutdown was putting at risk $3 billion a week that would have been earned by 65,500 small business contractors.

“The Chamber is again calling on Congress to immediately pass the continuing resolution to reopen and fund the government,” Neil Bradley, the group’s executive vice president, chief policy officer and head of strategic advocacy, wrote in a letter to lawmakers.

“We also urge Congress to consider ways to help make federal contractors, especially small business contractors, whole.”

The shutdown has also impacted the Supplemental Nutrition Assistance Benefits (SNAP) program, with benefit payments not going out as scheduled Nov. 1. The White House said Monday it would use contingency funds to pay 50% of SNAP benefits.

With the program frozen last week, DoorDash announced an Emergency Food Response for SNAP recipients and Project DASH partners who could be affected by the loss of SNAP benefits, along with added contributions of food from DashMart locations. Another delivery platform, Gopuff, has said it will offer $50 in free groceries to SNAP recipients during November.