Federal Workers Caught in Shutdown: Why America’s Largest Government Union Demanded Action

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The American Federation of Government Employees (AFGE), the nation’s largest union representing 820,000 federal and D.C. government workers, has issued public demands for lawmakers to end the crisis.

AFGE National President Everett Kelley has condemned the shutdown as an “avoidable crisis” and called on Congress to pass a clean continuing resolution to put federal employees back to work with full back pay.

The union’s stand was a response to the immediate financial hardship inflicted upon its members and to unprecedented threats from the executive branch that transformed the shutdown from a temporary disruption into an existential threat to the civil service.

How Government Shutdowns Became a Political Weapon

Government shutdowns, while a recurring feature of the modern American political landscape, are not an intended function of the U.S. system of government. They are a relatively recent phenomenon born from a specific legal interpretation that turned a procedural failure into a powerful tool of political negotiation.

The Constitution gives Congress control over government spending, which grants Congress the “power of the purse”—the authority to appropriate funds from the Treasury.

Since the modern budget process was established in 1976, Congress must pass 12 separate annual appropriation bills to fund the various federal agencies and their programs for each fiscal year, which runs from October 1 to September 30.

When Congress fails to pass these bills by the deadline, a “funding gap” occurs.

The legal trigger for a shutdown is the Antideficiency Act, a law first passed in 1870 and later amended, which makes it illegal for federal officials to spend money or enter into contracts in excess of what Congress has appropriated.

For over a century, this law did not lead to the widespread shutdowns seen today. During funding gaps, agencies would continue to operate, minimizing nonessential functions with the understanding that Congress did not intend for the entire government to close while it negotiated.

This changed dramatically in 1980 and 1981. In response to increasingly frequent funding gaps, President Jimmy Carter’s Attorney General, Benjamin Civiletti, issued two legal opinions that reinterpreted the Antideficiency Act.

These opinions argued that the law was “plain and unambiguous” and required federal agencies to cease all non-essential operations during a funding gap.

This changed how shutdowns work—only functions protecting life and property could continue.

What was once a law to ensure fiscal discipline became the mechanism that allows a legislative impasse to paralyze the federal government, a consequence Civiletti himself later said he could never have imagined.

This situation in the United States differs from other developed nations, which often have laws that allow the government to continue operating at the previous year’s funding levels automatically.

What Happens During a Shutdown

Furlough: When a funding gap occurs, employees deemed “non-essential” are placed on a temporary, unpaid leave known as a furlough. They are legally barred from working, even on a volunteer basis.

“Excepted” Employees: These are federal workers whose jobs are considered essential for national security, public safety, or the protection of life and property. They must continue to report to work during a shutdown but do not receive a paycheck until funding is restored. This group includes professions like air traffic controllers, TSA officers, FBI agents, and active-duty military personnel.

Continuing Resolution (CR): To avoid a shutdown, Congress can pass a short-term funding bill called a continuing resolution. A CR keeps the government open, usually at the prior year’s spending levels, for a set period to provide more time for lawmakers to negotiate and pass the full-year appropriation bills.

The 2025 Impasse: Healthcare and Spending Battles

The October 2025 shutdown occurred despite the Republican party holding the majority in both the House and Senate, as well as controlling the White House. This political alignment underscored the deep partisan divisions and the strategic use of the shutdown as a tool for policy leverage.

The central cause of the legislative deadlock was a partisan disagreement over federal spending levels and health insurance subsidies.

Democrats in Congress refused to vote for any government funding measure, including a temporary CR, unless it also extended critical tax credits for the Affordable Care Act (ACA) that were set to expire at the end of 2025.

They argued that failing to extend these subsidies would cause health insurance premiums to skyrocket for millions of Americans, potentially leading to a loss of coverage for 15 million people and raising the risk that the uninsured rate would return to pre-ACA levels.

Republicans refused to include the ACA subsidies in the funding legislation. They argued that extending these subsidies would cost $335 billion over 10 years and that negotiations on healthcare should be separate from the basic task of keeping the government funded.

House and Senate Republican leaders offered a CR that would fund the government through mid-December, allowing lawmakers additional time to negotiate both a full-year spending bill and a separate healthcare package.

Democrats rejected this proposal, preferring to keep both issues in a single bill.

Trump publicly opposed including ACA subsidies and accused Democrats of “holding the government hostage.” Democrats similarly accused Republicans of holding healthcare hostage.

With neither side willing to compromise, the government ran out of funding, triggering the partial shutdown.

How the Shutdown Affected Federal Workers

Federal employees faced immediate financial and emotional hardship. Agencies divided them into two groups based on whether their work was “essential.”

Furloughed Workers

Of the roughly 2.3 million civilian federal workers, approximately 670,000-750,000 were furloughed during the 2025 shutdown. These workers were placed on unpaid leave and legally barred from reporting to their jobs.

The furloughed employees came from a wide range of agencies, including many at the Department of Agriculture, the Environmental Protection Agency, NASA, and the National Park Service.

Excepted Workers

The remaining workers, approximately 730,000 were classified as “excepted” and required to work without knowing when they would next receive a paycheck.

This group included TSA officers, air traffic controllers, FBI agents, Border Patrol officers, federal prison guards, and active-duty military personnel.

While excepted workers continued to earn their regular salaries, those salaries were not paid during the shutdown. Instead, they accrued as a debt owed by the federal government to be paid once funding was restored.

Financial Strain

For both furloughed and excepted workers, the financial strain was immediate.

Federal employees missed their first paychecks on October 15, two weeks into the shutdown. As the closure stretched into its fourth week, workers were facing the prospect of missing a second paycheck on November 1.

Many federal workers live paycheck to paycheck. A 2019 survey by the Federal Reserve found that 39 percent of Americans would not be able to cover a $400 emergency expense with cash or its equivalent.

Federal employees reported being unable to afford rent, groceries, medical care, and childcare. They took on credit card debt, withdrew money from retirement savings, and turned to food banks.

Stories emerged of a TSA officer selling her plasma to make ends meet, a Park Service ranger relying on the charity of her church, and a Coast Guard family using a food pantry for the first time.

Historical Context

While federal law does not guarantee that furloughed workers will be paid for the time they missed, Congress has consistently passed legislation to provide back pay after every shutdown since 1976.

Excepted workers, by contrast, are legally entitled to back pay once funding is restored, though they still face the challenge of working for weeks without compensation.

Executive Branch Threats Escalated the Crisis

What distinguished the 2025 shutdown from its predecessors was the unprecedented nature of the threats emanating from the executive branch. These threats transformed the shutdown from a financial hardship into an existential crisis for the federal workforce.

The Threat of Mass Firings

On October 17, President Trump issued a public statement declaring that if Democrats continued to block the passage of a CR, he would direct federal agencies to conduct mass “reduction in force” (RIF) actions once the government reopened.

A RIF is a permanent termination of federal employees, typically used when an agency faces budget cuts or organizational restructuring. Unlike a furlough, which is temporary and reversible, a RIF means permanent job loss.

This threat was significant because federal employees normally enjoy strong civil service protections that make it difficult to terminate them outside of a genuine restructuring. However, the president’s statement suggested that the shutdown itself could be used as a pretext for large-scale firings.

Legal experts noted that while agencies do have the authority to conduct RIFs during funding gaps, doing so as retaliation against workers for a political dispute would be unprecedented and potentially illegal.

The Threat of Return-to-Office Mandates

On October 22, the Office of Management and Budget (OMB) issued a memorandum stating that all federal agencies must require employees to work full-time in their physical offices once the shutdown ended, effectively ending remote and hybrid work arrangements that had been in place since the COVID-19 pandemic.

The timing of this announcement, in the midst of a shutdown, was seen by many as a punitive measure aimed at demoralizing the workforce and potentially forcing voluntary resignations.

Research from federal employee organizations showed that flexible work arrangements had become highly valued by workers, particularly those with caregiving responsibilities, disabilities, or long commutes.

The Schedule F Executive Order

On October 25, President Trump signed Executive Order 14109, which reinstated and expanded the “Schedule F” classification for federal employees.

Schedule F, first created by executive order in October 2020 and rescinded by President Biden in 2021, allows the president to reclassify large numbers of federal workers from competitive service positions to at-will employees.

This reclassification strips workers of civil service protections, making them easier to fire and replace.

Critics argued that Schedule F is designed to politicize the federal bureaucracy, allowing the president to purge career civil servants who are seen as obstacles to his agenda and replace them with political loyalists.

Estimates suggested that as many as 50,000 federal employees could be reclassified under the order, stripping them of job protections and making them vulnerable to termination.

Good-government groups and unions immediately condemned the order as an assault on the merit-based civil service system and pledged to challenge it in court.

Why AFGE Fought to End the Shutdown

The combination of the shutdown’s financial toll and the executive branch’s escalating threats created an urgent imperative for AFGE to mobilize its members and pressure Congress to restore funding.

AFGE had three main goals: protecting members financially, defending civil service protections, and pushing back against using shutdowns as political tools.

Economic Survival

The most immediate concern was the financial devastation facing AFGE’s members.

Union leaders described workers who were skipping meals, unable to afford insulin, and facing eviction.

The psychological toll was equally severe. Workers described feeling disrespected, stressed, and uncertain about their futures.

Defending the Civil Service

The existential threat to federal employment created by the RIF warnings, return-to-office mandates, and Schedule F order transformed the shutdown into a larger battle over the future of the civil service.

AFGE viewed these actions as part of a coordinated effort to weaken and politicize the federal workforce, replacing professional, nonpartisan civil servants with political appointees loyal to the president.

This concern was grounded in the historical understanding that civil service protections, established by the Pendleton Civil Service Reform Act of 1883, were designed to create a merit-based system insulated from political interference.

AFGE argued that the combination of mass firings, forced office returns, and Schedule F reclassifications could lead to a mass exodus of experienced workers, hollowing out the institutional capacity of federal agencies.

Preventing Normalization

AFGE was also fighting against the normalization of government shutdowns as a routine tool of political negotiation.

Every shutdown inflicts damage on the federal workforce, eroding morale and driving away talent. By forcing a swift resolution to the 2025 crisis, AFGE hoped to demonstrate the unacceptable costs of using workers as political pawns and build pressure on Congress to reform the budget process to prevent future shutdowns.

AFGE’s Multi-Pronged Response

AFGE’s strategy to combat the shutdown involved legal action, member support services, and public advocacy.

Legal Challenges

AFGE moved quickly to challenge the executive branch’s most aggressive actions in federal court.

On October 26, the union filed a lawsuit in the U.S. District Court for the District of Columbia seeking to block the implementation of Executive Order 14109 and the Schedule F reclassifications.

The complaint argued that the order violated the Administrative Procedure Act and the civil service laws enacted by Congress, and that it was an unconstitutional attempt to strip federal workers of their property interest in continued employment without due process.

AFGE also sent legal letters to agency heads warning that any RIF actions taken during or immediately after the shutdown would be challenged as retaliatory and illegal.

Member Support Services

Recognizing the immediate financial crisis facing its members, AFGE established an emergency hardship fund to provide small grants to workers facing eviction, utility shutoffs, or other critical expenses.

The union also negotiated with financial institutions and utility companies to offer payment deferrals and fee waivers for federal employees.

AFGE provided its members with template letters to send to landlords, mortgage companies, and creditors explaining their situation and requesting forbearance.

Public Advocacy and Pressure

To amplify its message, AFGE organized press conferences with other labor leaders and launched a grassroots advocacy campaign.

It provided a hotline number for members to call Congress and encouraged them to write letters to the editor.

AFGE established a Speakers’ Bureau to train and empower rank-and-file members to share their personal stories of hardship with local media outlets, leveraging authentic voices to build public pressure on elected officials.

AFGE combined legal action, member support, and public pressure. AFGE was acting as a legal shield against executive overreach, a temporary social services provider for its members in crisis, and a political force mobilizing public opinion.

Economic Costs Extended Beyond the Federal Workforce

The impact of the shutdown extended far beyond the federal workforce, creating significant economic costs and disrupting essential services for the American public.

The Congressional Budget Office (CBO) estimated that the 35-day shutdown in 2018–2019 reduced U.S. economic output by $11 billion, of which $3 billion was permanently lost.

For the 2025 shutdown, economists projected a similar drag, with each week of the closure shaving an estimated 0.1 percentage point from annualized GDP growth, equivalent to a loss of about $7 billion per week.

A significant portion of this cost comes from paying furloughed federal employees back pay for time they did not work. A 2019 Senate report found that the three previous shutdowns cost taxpayers nearly $4 billion, with $3.7 billion of that going to back pay.

The shutdown also inflicted damage on the private sector. The U.S. Small Business Administration (SBA) and the Federal Housing Administration (FHA) stopped accepting and approving new loan applications, stalling business growth and home sales.

Federal contractors faced payment delays and suspended work, creating uncertainty that rippled through their supply chains.

This disruption of the routine administrative functions of government—issuing permits, providing loans, and releasing economic data—created a “phantom drag” on the economy, injecting uncertainty that led private firms to postpone investment and hiring decisions.

Public Services Ground to a Halt

The American public experienced the shutdown through a wide range of service disruptions.

Air Travel: With TSA agents and air traffic controllers working without pay, staffing shortages led to significant flight delays at major airports like Dallas, Chicago, and Atlanta. In a stark example of the risk, the air traffic control tower at Hollywood Burbank Airport in California was left unstaffed for six hours, forcing pilots to coordinate takeoffs and landings among themselves.

Public Health and Safety: The shutdown meant fewer food-safety inspections, a halt to most Environmental Protection Agency (EPA) enforcement actions against polluters, and a suspension of critical economic data collection by the Bureau of Labor Statistics (BLS).

The halt in the release of the Consumer Price Index (CPI) created uncertainty for markets and could have impacted the annual Cost of Living Adjustment for Social Security benefits.

Social Safety Net: As the shutdown stretched into its fourth week, funding for vital nutrition programs was jeopardized. States warned that the 40 million Americans relying on the Supplemental Nutrition Assistance Program (SNAP) could lose access to benefits if the shutdown continued into November.

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) was also at risk of running out of funds, forcing some states to limit applications.

Public Lands and Tourism: While many national parks remained accessible, visitor centers and restrooms were closed, and services like trash collection and road maintenance were suspended.

Long-Term Damage to Federal Workforce

Beyond the immediate economic and social disruptions, government shutdowns inflict deep, long-term damage on the federal government’s most valuable asset: its people.

The recurring cycle of furloughs and political brinkmanship erodes morale, drives away talent, and degrades the institutional capacity of the civil service.

Research from the USC Sol Price School of Public Policy shows that shutdowns have an acutely negative effect on employee morale, job satisfaction, and sense of accomplishment.

Being labeled “non-essential” and treated as a political bargaining chip is profoundly demoralizing. This was echoed in the personal accounts from the 2025 shutdown, where workers described feeling stressed and disrespected, with one VA employee speaking of a “moral injury” that comes with being a federal worker.

While some employees may become accustomed to the recurring threat, this normalization only applies to those who choose to stay, as many of the most disaffected and talented workers seek employment elsewhere.

The most significant long-term consequence of government shutdowns is the “brain drain” they cause within the federal workforce.

The same USC research found that job separations increase substantially in the fiscal quarter immediately following a shutdown. According to their preliminary findings, a federal agency with 10,000 full-time employees could expect to lose an additional 500 workers after a shutdown, on top of normal attrition.

This exodus of talent represents a critical loss of institutional knowledge, experience, and expertise. Each time a seasoned scientist, an experienced contract officer, or a veteran policy analyst leaves public service out of frustration, the government’s ability to perform its core functions is diminished.

This creates a self-perpetuating cycle of decline: shutdowns weaken the civil service, leading to less effective government performance, which in turn fuels public cynicism and political attacks that make future shutdowns more likely.

AFGE’s efforts to end the 2025 shutdown reflected concerns about the shutdown’s impact.

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