The National Retail Federation (NRF) is urging Congress to end the federal government shutdown that began on October 1 after lawmakers failed to approve a spending bill for the 2026 fiscal year. The NRF warns that a prolonged shutdown could weaken consumer confidence and dampen retail sales during the holiday season, a vital period for the nation’s economy.
The NRF highlighted that reduced income for federal employees, along with wider economic uncertainty, could lead consumers to curb spending by tens of billions of dollars. Disruptions in trade and supply chain operations could also create ripple effects for retailers and manufacturers across the country. Small businesses are particularly vulnerable, as many operate with limited margins and may struggle to absorb delays or drops in sales.
Roughly 900,000 federal workers have been furloughed, with another 700,000 continuing to work without pay. A White House analysis estimates that the shutdown could reduce U.S. GDP by about $15 billion for each week it continues. As of October 6, congressional negotiations remain at an impasse, leaving the retail industry bracing for potential fallout as the holiday shopping season approaches.
