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Shutdown Has Direct, But Limited, Effect On MN

So far, the effect of the government shutdown has primarily been limited to federal workers turned away from their jobs, but if the government stays in the dark much longer, federal funding limitations may broaden the impact.

Shutdown Has Direct, But Limited, Effect On MN
The federal government, for the first time in 17 years, has shut itself down.
 
The duration of the shutdown is still foggy as the Republican-controlled House of Representatives and the Democratic-controlled Senate remain at odds over a budget plan.
 
The Republicans’ primary concerns stem from President Barack Obama’s health care law, which was actually not affected by the shutdown; portions of it went into effect Tuesday morning.
 
Minnesota has slightly more than 30,000 federal workers, according to the Federal Executive Board of Minnesota, although over a third of those are postal employees who will not be affected by the shutdown. The remaining groups learned this morning whether they were “nonessential” or “essential” employees. The former were told to go home without pay while the essential employees had to work without immediate pay—the Office of Personnel Management in Washington decides the distinction.
 
Calls to multiple state agencies were not returned Tuesday morning but state officials told the Star Tribune that it was too soon to tell how the shutdown would affect Minnesota’s economy, grants it gets from the federal government, or services delivered to its residents.
 
Most employees that work in law enforcement and health care as well as Transportation Security Agency (TSA) workers at the Minneapolis/St. Paul airport, prison guards, and meat inspectors are “essential” and are working today—and while they will be paid for the hours they work, their paychecks won’t arrive until the shutdown ends.
 
Jane Nygard, national vice president for the American Federation of Government Employees’ five-state district, a union that includes federal workers from Minnesota, told Twin Cities Business that final numbers have not come in yet, but she estimates that between 40 and 60 percent of the state’s federal workers were sent home Tuesday, many of which are lower income workers.
 
“While many Minnesotans will keep working at the airports and prisons, it’s the janitors, secretaries, and clerks that are being turned away as ‘nonessentials,’” she said. “And they are the people who rely desperately on a scheduled paycheck to maintain a living.”
 
According to Nygard, federal workers from the Minneapolis Veterans Hospital and the reserve Air Force base have begun protesting the shutdown near the Air Force base on Highway 62. Nygard estimates that around 200 workers from the Air Force reserve base were sent home this morning.
 
The Minnesota National Guard reportedly was putting 1,207 of its 2,100 full-time military support personnel on furlough until further notice. 
 
To see guidance from each federal agency on their furlough plans click here.
 
Workers in the private sector, meanwhile, shouldn’t notice much of a difference as a result of the shutdown. The director of communications at the Minnesota Chamber of Commerce Jim Pumarlo told Twin Cities Business Tuesday morning that his organization hadn’t heard from any businesses thus far about problems resulting from the shutdown.
 
“At this point, the government is really trying to make sure the shutdown only affects the specific federal workers, and not the general public,” Nygard said. “But that’s only going to last so long. If this keeps up, groups that depend on federal funds will eventually start to feel the negative affects as well.”
 
For example, the U.S. Small Business Administration will reportedly stop processing loans to Minnesota companies during the shutdown. The Minnesota Management and Budget agency also announced, in a memo issued before the shutdown, that state funds would not be used to replace any permanent reduction in federal funds.
 
Some federal entities tapped by the public sector, meanwhile, remain operational. For example, the U.S. Patent and Trademark Office is still processing applications.
 
For a list of what federal facilities are open and which are closed click here.
 
While stocks dropped slightly in the days leading up to the shutdown, now that it’s come, stocks have actually been going up. The Dow Jones industrial average was up 53 points, or 0.35 percent, to 15,181 as of 1:08 p.m. The S&P 500 index gained 11 points, or 0.65 percent, to 1,692. The Nasdaq composite rose 35 points, or 0.94 percent, to 3,807.

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