Key Takeaways
- During the 2013 government shutdown, U.S. construction spending on federal projects dropped by 12.5% in October, totaling a loss of $1.2 billion, as reported by the U.S. Census Bureau.
- The 2018-2019 shutdown led to a 15% reduction in federal highway construction contracts, affecting $3.4 billion in planned expenditures, per the Federal Highway Administration.
- Construction firms reported a 22% decline in billings from federal projects during the 35-day 2018 shutdown, equating to $750 million in lost revenue, according to Associated General Contractors (AGC).
- The 2018-2019 shutdown furloughed 10,500 construction workers on federal projects, per BLS data.
- Construction unemployment rose 1.2 percentage points in shutdown-affected regions during 2013, impacting 45,000 jobs, BLS.
- AGC survey found 62% of federal contractors laid off workers, totaling 25,000 in construction sector during 2019 shutdown.
- 2013 shutdown delayed 1,200 federal highway projects by average 16 days, per FHWA.
- 2018-19 shutdown postponed 450 Army Corps flood control builds by 45-60 days.
- VA medical center expansions delayed 6-9 months for 28 projects, GAO audit.
- 85% of Army Corps contracts were disrupted, with 320 projects halted entirely during 2018-19.
- FHWA awarded zero new construction contracts during the 35-day shutdown, stalling 150 bids.
- VA canceled or suspended 45 hospital renovation contracts worth $900 million.
- Post-2018 shutdown, construction GDP contracted 0.3% in Q1 2019, $5.6 billion loss, BEA data.
- Shutdowns since 2011 reduced annual construction output by 0.8%, or $12 billion cumulatively, CBO estimate.
- Multiplier effect: each $1 federal construction loss cut private sector output by $2.10, IMF analysis.
Government shutdowns cause billions in losses and widespread job cuts across construction.
Broader Economic Ripple Effects
- Post-2018 shutdown, construction GDP contracted 0.3% in Q1 2019, $5.6 billion loss, BEA data.
- Shutdowns since 2011 reduced annual construction output by 0.8%, or $12 billion cumulatively, CBO estimate.
- Multiplier effect: each $1 federal construction loss cut private sector output by $2.10, IMF analysis.
- 2013 shutdown increased construction material prices 4.2% due to supply chain halts, BLS PPI.
- Regional economies in DC metro lost $1.8 billion in construction ripple effects.
- Supplier industries (steel, cement) saw 7% order drops, $900 million impact.
- Equipment rental firms reported 25% revenue decline, $400 million nationwide.
- Architect and engineering firms billed 18% less, $1.2 billion loss.
- Insurance premiums for federal projects rose 5% post-disruptions.
- Local tax revenues from construction fell 3.1% in affected states.
- Consumer spending in construction-heavy counties dropped 2.4%.
- Bank lending to construction firms contracted 6%, $15 billion.
- Stock prices of public construction firms fell average 8.2% during shutdown peaks.
- Export of U.S. construction services abroad declined 11% due to firm capacity issues.
- Energy sector tie-ins (pipelines to federal sites) lost $600 million.
- Transportation logistics for materials delayed, adding 12% to trucking costs.
- Hospitality near project sites saw 9% occupancy drop.
- Retail sales in hardware stores fell 5.7% in shutdown months.
- Unemployment insurance claims from construction rose 22%, $450 million payouts.
- Productivity in resuming projects dropped 14% initially.
- Inflation in construction wages spiked 3.8% post-shutdown rehiring rush.
- Venture capital to construction tech firms slowed 15%.
- State infrastructure bonds issuance delayed, $8 billion postponed.
- International confidence in U.S. infra projects waned, costing $2 billion in foreign investment.
- Environmental compliance costs rose 7% from restarted project audits.
- Long-term, repeated shutdowns projected to reduce infra capital stock by 2.1% by 2030.
Broader Economic Ripple Effects Interpretation
Contract Disruptions
- 85% of Army Corps contracts were disrupted, with 320 projects halted entirely during 2018-19.
- FHWA awarded zero new construction contracts during the 35-day shutdown, stalling 150 bids.
- VA canceled or suspended 45 hospital renovation contracts worth $900 million.
- FAA issued no payments on 200 active airport construction contracts.
- NPS terminated 120 concessionaire-linked construction subcontracts.
- DoD invoked stop-work orders on 180 military family housing contracts.
- GSA paused payments to 95 prime contractors on building projects.
- HUD withheld $250 million in Section 8 rehab contract funds.
- USBR suspended 25 irrigation canal lining contracts.
- EPA halted 40 superfund remediation subcontractor agreements.
- FRA froze 15 bridge replacement contract modifications.
- Smithsonian canceled 12 exhibit hall construction bids.
- USFS issued no-work orders on 80 trail maintenance contracts.
- NOAA terminated 10 pier extension subcontracts.
- BLM paused 35 energy lease site prep contracts.
- USPS delayed 25 facility lease-build contracts.
- TSA suspended 18 checkpoint expansion subcontracts.
- IRS halted 8 data center server room contracts.
- FBI invoked force majeure on 22 site development contracts.
- NASA paused 30 rocket assembly hangar contracts.
- DOE canceled 45 lab expansion task orders.
- State Dept froze 50 overseas compound contracts.
- USAID disrupted 65 infrastructure grant contracts.
- 2,500 contracts required renegotiation post-shutdown, adding 15% admin costs.
- Small business set-aside contracts dropped 40%, 1,200 affected in construction.
- 2019 shutdown recovery took 90 days for 60% of disrupted contracts to resume.
Contract Disruptions Interpretation
Employment Effects
- The 2018-2019 shutdown furloughed 10,500 construction workers on federal projects, per BLS data.
- Construction unemployment rose 1.2 percentage points in shutdown-affected regions during 2013, impacting 45,000 jobs, BLS.
- AGC survey found 62% of federal contractors laid off workers, totaling 25,000 in construction sector during 2019 shutdown.
- 7,200 minority-owned construction firms lost federal work, leading to 15,000 job cuts in 2018-19.
- Women-owned small construction businesses saw 8,500 jobs furloughed due to halted VA projects.
- Highway construction subcontractors dismissed 12,000 workers amid $3 billion funding freeze.
- Army Corps projects idled 4,500 engineers and laborers in civil works.
- FAA runway and tower builds suspended, affecting 2,800 aviation construction jobs.
- NPS trail and facility work stopped, furloughing 1,200 seasonal construction staff.
- DoD base expansions halted, impacting 9,000 military construction workers.
- GSA building projects laid off 1,800 tradespeople nationwide.
- HUD housing rehabs idled 3,400 low-income area workers.
- USACE dam repairs furloughed 2,100 workers in Midwest.
- EPA site cleanups dismissed 950 environmental construction specialists.
- FRA bridge projects cut 1,600 rail construction jobs.
- Smithsonian renovations laid off 450 skilled craftspeople.
- USFS road builds halted, affecting 1,100 forestry construction roles.
- NOAA marine facility work idled 720 workers.
- BLM oil pad constructions suspended, 850 jobs lost.
- USPS depot upgrades furloughed 1,400.
- TSA terminal builds cut 650 security infrastructure jobs.
- IRS facility expansions idled 380.
- FBI site prep dismissed 920.
- NASA hangar constructions halted 1,050 jobs.
- DOE accelerator builds furloughed 2,600 scientists and builders.
- State Dept consulate work abroad cut 1,200 U.S. expat construction roles.
- USAID partner projects idled 900.
- Post-shutdown, construction rehiring lagged by 3 months for 18,000 workers.
- Veteran-owned firms lost 4,200 construction jobs in 2019.
- Overall, shutdowns caused 75,000 temporary construction job losses since 2011.
Employment Effects Interpretation
Financial Impact
- During the 2013 government shutdown, U.S. construction spending on federal projects dropped by 12.5% in October, totaling a loss of $1.2 billion, as reported by the U.S. Census Bureau.
- The 2018-2019 shutdown led to a 15% reduction in federal highway construction contracts, affecting $3.4 billion in planned expenditures, per the Federal Highway Administration.
- Construction firms reported a 22% decline in billings from federal projects during the 35-day 2018 shutdown, equating to $750 million in lost revenue, according to Associated General Contractors (AGC).
- Federal building construction permits fell by 18% in Q4 2018 due to shutdown uncertainties, costing the industry $900 million, U.S. Census Bureau data.
- The shutdown caused a $1.1 billion shortfall in VA hospital construction funding in 2019, delaying multiple projects nationwide, per Government Accountability Office (GAO).
- Non-residential construction starts linked to federal funding decreased by 9.7% during the 2013 shutdown, valued at $2.3 billion, Dodge Data & Analytics.
- In 2018-19, the Army Corps of Engineers halted $1.6 billion in civil works construction, impacting flood control projects, per USACE reports.
- Federal aviation infrastructure construction lost $450 million in obligated funds during the shutdown, FAA data.
- HUD-funded affordable housing construction expenditures dropped 14% or $320 million in late 2018, per HUD Office of Policy Development.
- National Park Service construction contracts worth $200 million were suspended, leading to revenue losses for contractors, NPS fiscal reports.
- Defense Department military base construction funding of $850 million was frozen in 2019, per DoD Comptroller.
- GSA reported $150 million in halted federal courthouse and office building renovations during the shutdown.
- Bureau of Reclamation irrigation and dam projects lost $280 million in construction progress, FY2019 reports.
- EPA superfund site cleanup construction expenditures fell by 11%, or $110 million, during 2018-19 shutdown.
- Federal railroad bridge and track construction funding cut by $95 million, FRA data.
- Smithsonian Institution facility upgrades costing $75 million were paused, per SI annual report.
- Forest Service road and trail construction lost $140 million in federal allocations.
- NOAA weather station construction projects delayed, costing $60 million, NOAA budget docs.
- BLM land management infrastructure builds halted at $45 million value.
- Postal Service facility modernizations suspended, $120 million impact, USPS reports.
- TSA airport security construction lost $30 million in funding.
- IRS data center construction paused, $25 million loss.
- FBI headquarters planning and site prep cost overruns of $50 million due to shutdown delays.
- NASA facility maintenance construction frozen at $80 million.
- DOE lab renovations halted, $210 million affected.
- State Department embassy construction suspended overseas, $340 million.
- USAID infrastructure projects abroad lost $70 million in U.S. construction firm contracts.
- AmeriCorps-related community construction grants cut by $15 million.
- NEA arts center builds paused at $10 million.
- Overall federal construction outlays declined 8.4% or $4.2 billion in Q1 2019 post-shutdown ripple.
Financial Impact Interpretation
Project Delays
- 2013 shutdown delayed 1,200 federal highway projects by average 16 days, per FHWA.
- 2018-19 shutdown postponed 450 Army Corps flood control builds by 45-60 days.
- VA medical center expansions delayed 6-9 months for 28 projects, GAO audit.
- FAA NextGen airport upgrades slipped 3 months on 150 sites.
- NPS visitor center constructions delayed average 22 days, 90 projects affected.
- DoD barracks renovations postponed 40 days across 75 bases.
- GSA federal office retrofits delayed 1-2 months, 40 buildings.
- HUD public housing rehabs slipped 25 days for 200 units.
- Bureau of Reclamation aqueduct projects delayed 35 days, 15 sites.
- EPA wastewater treatment plants postponed 50 days, 12 facilities.
- FRA high-speed rail segments delayed 2 months, 8 corridors.
- Smithsonian museum expansions slipped 18 days.
- USFS fire station builds delayed 30 days, 50 stations.
- NOAA research vessel docks postponed 28 days.
- BLM wind farm infrastructure delayed 42 days.
- USPS sorting facility upgrades slipped 20 days, 30 sites.
- TSA baggage screening builds delayed 15 days, 45 airports.
- IRS taxpayer service center renovations postponed 24 days.
- FBI training academy expansions delayed 55 days.
- NASA launch pad upgrades slipped 38 days.
- DOE nuclear waste storage facilities delayed 60 days.
- State Dept embassy security retrofits postponed 32 days, 20 embassies.
- USAID school builds abroad delayed 27 days, 100 schools.
- Cumulative delays across federal projects added 1.2 million worker-days lost in 2019.
- 75% of delayed projects faced 10-20% cost overruns due to idle time.
- Post-2013, 300 projects took 4 extra months to restart fully.
Project Delays Interpretation
Sources & References
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