The US entered a government shutdown on Oct. 1, 2025 after Congress failed to pass funding. Here’s why it happened, what’s closed, and what stays open.
WASHINGTON, D.C. – The United States entered a federal government shutdown at 12:01 a.m. on Wednesday, October 1, 2025, after Congress did not enact spending measures in time for the new fiscal year.
With no continuing resolution or appropriations bills in place, agencies began implementing contingency plans once funding expired.
How the shutdown came about
Federal law requires Congress to pass 12 appropriations bills or adopt a temporary funding measure to keep government operations running.
On September 30, the Senate considered two short-term proposals. One was supported by Democrats and included Affordable Care Act subsidies and changes to Medicaid. The other was supported by Republicans and would have funded the government for seven weeks.
Neither proposal advanced, and the fiscal year began without funding authority. The Office of Management and Budget directed agencies to implement their shutdown procedures.
The appropriations bills at the heart of every shutdown
There are 12 appropriations bills that form the backbone of government funding. Each outlines how agencies and programs are supported. When they lapse, a shutdown begins.
What each bill covers:
- Agriculture, Rural Development, Food and Drug Administration – USDA, FDA, rural housing, nutrition programs.
- Commerce, Justice, Science (CJS) – Commerce Department, Justice Department, FBI, DEA, NASA, NSF.
- Defense – Department of Defense, military operations, weapons procurement.
- Energy and Water Development – Department of Energy, Army Corps of Engineers, nuclear security.
- Financial Services and General Government (FSGG) – Treasury, IRS, SEC, SBA, judiciary, executive offices.
- Homeland Security – DHS, Border Patrol, TSA, FEMA, Coast Guard, Secret Service.
- Interior and Environment – Department of the Interior, EPA, Forest Service, National Park Service.
- Labor, Health and Human Services, Education (LHHS) – Department of Labor, HHS (CDC, NIH), Department of Education, job training, student aid.
- Legislative Branch – Congress, Library of Congress, Government Accountability Office.
- Military Construction and Veterans Affairs (MilCon–VA) – Veterans’ health care, VA hospitals, military housing.
- State and Foreign Operations (SFOPS) – State Department, USAID, foreign aid, UN contributions.
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Transportation, Housing and Urban Development (THUD) – Department of Transportation (FAA, highways, transit), HUD housing, community development.
What happens during a shutdown
The Antideficiency Act bars federal agencies from spending money without congressional authorization. That means nonessential operations are paused. Essential personnel such as active-duty military, law enforcement officers, air traffic controllers, and hospital staff continue working, but they do not receive pay until funding resumes. Historically, all affected employees receive back pay once a shutdown ends.
Hundreds of thousands of other federal workers are furloughed. They are placed on temporary unpaid leave and are legally barred from performing their duties during the lapse. In this shutdown, the Office of Management and Budget has also instructed agencies to consider permanent workforce reductions for programs with no funding source if the impasse continues.
Services that continue, and those that slow
Not everything halts. Social Security, Medicare, and Medicaid benefits continue because they are funded by mandatory spending. However, new applications and administrative support can be delayed.
Mail delivery continues because the U.S. Postal Service is funded through postage and fees, not annual appropriations.
Passport and visa services may also continue because they are funded through user fees, although facilities inside closed federal buildings can cause slowdowns.
National parks, museums, and regulatory agencies are often among the most visible casualties. In past shutdowns, some sites closed completely while others remained open with limited staff, which led to sanitation and safety concerns.
Key economic data releases, such as the monthly jobs report, are suspended because Bureau of Labor Statistics and Census Bureau staff are furloughed. This limits information available to markets and policymakers.
Claims and context
Some leaders have framed the funding dispute as a fight over health care access for undocumented immigrants. Federal law, however, makes clear that undocumented immigrants are not eligible for Medicaid, Medicare, or ACA marketplace subsidies.
Independent analysts confirm that the Democratic proposal at issue was focused on preserving subsidies for eligible Americans and reversing earlier Medicaid reductions.
Timeline
- Mid to late September: Early attempts to extend funding faltered.
- September 30: The Senate considered and rejected both a Democratic proposal and a Republican stopgap.
- October 1: With no measures enacted, funding lapsed and agencies began executing shutdown plans.
Impacts to date
The Department of Labor announced that economic data releases, including the September jobs report, would be delayed.
Federal courts said they can sustain normal operations with existing funds through October 17 before service may be curtailed.
Prospects and uncertainties
The scope of disruption depends on how long the impasse lasts. A short shutdown may cause minimal impact, but a prolonged one magnifies costs and service gaps.
Federal employee groups are also challenging new guidance on possible permanent reductions in force, raising concerns that this shutdown could have longer-term workforce effects than previous lapses.
Structural lessons from the stalemate
The October 2025 shutdown resulted from the failure to agree on a temporary funding plan before the fiscal-year deadline. Both parties presented proposals that did not advance, leaving the government without legal authority to spend.
The immediate effects are visible in delayed data releases, furloughed workers, and reduced public services. The longer-term outcome depends on how quickly Congress and the White House can compromise.
