WATCH: Davids Joins Small Business Owners, Highlights Consequences of Avoidable Government Shutdown

Yesterday, Representative Sharice Davids joined Small Business Majority and business owners from across the country to discuss the consequences of a government shutdown for our nation’s small businesses. Moody’s Analytics estimated that the 2018-2019 shutdown delayed more than $2 billion in loans to small businesses, devastating small business owners and the communities they support. While Davids continues to call for a bipartisan path forward, without Congressional action, the federal government is set to shut down at 12:01 a.m. ET on November 18, 2023.

“A shutdown is a devastating blow to our economy and represents real consequences for hardworking Kansans, including our small businesses which make up over 90 percent of employers in Kansas’ Third District,” said Davids. “Small businesses in Kansas are already struggling with higher prices as well as inventory and workforce issues. They hardly need more stress and uncertainty. I implore my colleagues to join me in working across the aisle to advance legislation that prevents a costly, harmful, and avoidable government shutdown, and to pass bipartisan legislation that reauthorize the FAA and Farm Bill.”

“A government shutdown would be a disaster for America’s hardworking small business owners and their employees,” said John Arensmeyer, founder & CEO, Small Business Majority. “With small firms unable to secure Small Business Administration and other government loans to small business government contractors seeing their revenue evaporate, entrepreneurs across the country, particularly in under resourced at-risk communities, will needlessly suffer. Moreover, buying power across all segments of the economy will be dealt a sharp blow putting our economic revival in jeopardy. Small businesses have weathered so much over the past few years; adding insult to injury would be devastating. Congress must pass a fully funded budget now.”

Last year, Davids released a report on the state of small business in Kansas’ Third Congressional District. Now, a government shutdown would have devastating consequences for these small businesses and needlessly undermine America’s economic progress. Specifically:

• The U.S. Small Business Administration would stop processing new business loans for small businesses during a shutdown.
  • This would deny Kansas small businesses of more than $790,000 of financing per weekday due to 7(a) and 504 loan applications failing to move forward.
• A shutdown would disrupt the average $13 billion per week in federal contracts that go to businesses throughout the country — nearly $3 billion of which goes to small businesses.
• Small businesses are the first to cut costs during a shutdown, which proves consequential as these businesses employ close to half of all U.S. private sector workers.
• A shutdown means that businesses owners, including farmers, can lose access to updated federal data on key measures like employment, oil prices, trade flows, and agricultural trends that they use to guide important daily business decisions.

Davids continues to push for a bipartisan agreement to keep the government open. Aside from the consequences for small businesses, a shutdown would have serious impacts on Kansas families and the overall U.S. economy. Americans would face disruptions to important benefits, service members would not be compensated, and federal workers would be furloughed and go unpaid. Specifically:

• It’s estimated the five-week partial government shutdown in 2018-2019 reduced economic output by $11 billion in the following two quarters and the 2013 full government shutdown reduced GDP growth by $20 billion.
• Kansans receiving Social Security, Medicare, and Medicaid benefits would experience service delays, including disruptions to verifying benefits and the issuance of new cards.
• There are currently 19,977 federal workers in Kansas who may be furloughed. A bipartisan report found that the last three government shutdowns led to the equivalent of 56,940 years in lost productivity from federal workers.
• The distribution of important food assistance programs, including the Supplemental Nutrition Assistance Program (SNAP), could be disrupted, leaving some Kansan — including women, children, and the elderly — without nutritious food.
• Travelers could face longer lines at airport security checkpoints and flight delays during a shutdown, which would also delay passport processing times even further.

Davids serves on the U.S. House Transportation and Infrastructure Committee and the Agriculture Committee, which are responsible for overseeing the Federal Aviation Administration (FAA) and Farm Bill reauthorizations, respectively. Both reauthorizations would lapse after November 17, alongside general federal government funding. Without further action from Congress, these expirations would negatively impact Kansans’ ability to support their families and run their businesses.