White House: Government shutdown drags down economic growth, jobs

A partial US government shutdown this month has cut 0.25 percentage point off the fourth- quarter economic growth and cost the country 120,000 jobs in October, Jason Furman, chairman of the White House Council of Economic Advisers, said on Tuesday. The government shutdown has translated into 0.25 percentage point off the fourth-quarter U.S. economic growth rate, he said in an analysis of the bitter fiscal fight which led to a 16-day government shutdown and a close call with a debt default. "We're 120,000 fewer jobs than we otherwise would have had in the month of October," Furman said at a White House daily briefing. The federal government was forced into the first shutdown in 17 years on Oct. 1 after Republicans tried to make a bill to tie funding the government on changing President Barack Obama's signature health care law. Facing an imminent prospect of a debt default, the bitterly- divided Congress ultimately passed a legislation on Oct. 16 to lift the debt ceiling through Feb. 7, and fund the government through Jan. 15. The temporary deal, however, does not resolve the fundamental divide between Republicans and Democrats on spending and deficits. Furman warned that, "That's just based on the data we have through October 12th. So as we look at more of October, those numbers could change and could potentially get worse." "This all just really underscores how unnecessary and harmful the shutdown and the brinkmanship was for the economy, why it's important to avoid repeating it, and instead consider jobs that are adding to growth, not subtracting," he said.