Shutdown Nears Its End — But Economic Damage Is Mounting, Goldman Says

The U.S. government shutdown has dragged into its 33rd day, and while a resolution may soon be approaching, economists warn the economic fallout is already underway.

In a note to clients on Monday, Goldman Sachs economist Alec Phillips said the standoff in Washington is likely to cost the U.S. economy more than a full percentage point of growth in the final quarter of 2025, shaving GDP growth to just 1.0%.

That's a significant downgrade. Goldman had previously expected a stronger finish to the year, but now believes the shutdown will result in postponed federal spending, delayed hiring, and reduced investment.

How Long Could The Shutdown Last?

If current odds are any guide, the shutdown could stretch further still.

Prediction markets tracked by CFTC-regulated betting platform Kalshi peg the median expected duration at 45.9 days, or until Nov. 15.

As of now, there’s an implied 75% chance it lasts over 40 days, and a 35% chance it extends beyond 50.

The standoff is shaping up to become the longest government shutdown in U.S. history, surpassing the 35-day shutdown in 2018-2019.

Yet pressure is mounting. Missed pay for air traffic controllers and TSA screeners on Oct. 28, with another due Nov. 10, threatens a replay of the 2019 shutdown, when airport delays forced a last-minute compromise.

Meanwhile, SNAP food benefits, normally issued the first week of each month, are at risk—though a recent court ruling may allow for partial disbursement using contingency funds.

Why This Shutdown Hurts More Than Past Ones

Unlike previous shutdowns that targeted specific agencies, this one involves a full lapse in congressional appropriations, making it broader in scope and impact.

"This shutdown will have the greatest economic effect on record," Goldman said in the note. "A longer duration could spill over into private-sector activity, delaying investments and stalling consumption."

The immediate damage is expected to come from federal employee furloughs and delayed government purchases.

If the shutdown runs six weeks, federal spending pushed into first-quarter 2026 could slightly boost growth by 1.3 percentage points in that quarter, according to Goldman's models.

Political Stalemate Or Imminent Breakthrough?

Goldman Sachs sees growing signs the shutdown may soon end. The start of ACA enrollment on November 1 has intensified focus on health care subsidies, while the November 4 elections and the upcoming congressional recess could shift political incentives. Public-sector unions, including the AFGE, are now calling for a resolution, adding pressure on Democrats and Republicans to reach a deal.

So far, Democrats have resisted a clean funding bill, but polls show voters largely blame Republicans and President Trump. A possible compromise could involve reopening the government now, with a promised vote on health subsidies before the November 21 deadline.

Goldman views more drastic moves, like scrapping the Senate filibuster, as unlikely. Still, with prediction markets pointing to a mid-November resolution, momentum toward a deal appears to be building.

"We underestimated how long this shutdown would last," said Alec Phillips. "But the political and financial pressure is building, and the window for compromise is finally opening."

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