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Impact of longest US government shutdown widening

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
Furloughed federal workers and those aligned with them protest the partial government shutdown in the Hart Senate Office Building January 23, 2019 in Washington, DC. (Getty Images)

The impact of the longest US government shutdown is widening, with most of the 800,000 employees who have been furloughed or are working without pay expected to miss their second paychecks on Friday.

The shutdown reached its 34th day on Thursday, as Republican President Donald Trump and Democrats in Congress remain divided over Trump’s demand for $5.7 billion in partial funding for a wall along the US-Mexico border.

Congressman James Clyburn, the third ranking Democrat in the US House of Representatives on Wednesday suggested ending the partial government shutdown by giving Trump money he seeks but earmarking it for other security tools such as drones, X-rays and sensors, as well as more border patrol agents.

The government closure, which began on December 22, is the 19th since the mid-1970s, although most have been brief. The current one has affected a quarter of federal agencies, including the Departments of Interior, Commerce, Homeland Security and Transportation, as well as NASA and the Internal Revenue Service (IRS).

Some 800,000 employees have been furloughed or are working without pay. Several million private contractors working for many government agencies are also without pay.

On Wednesday, about 500 government workers, union leaders and supporters gathered in the Hart Senate Office Building in Washington, DC, to protest — chanting phrases like “No more food banks, we need paychecks.”

The protest, led by union leaders from the National Federation of Federal Employees, is meant to draw attention to the plight of federal workers - many of whom have had to dig into their savings, take on side jobs and seek help from food banks and other charitable programs to stay afloat.

The partial government shutdown is expected to hurt the already-slowing US economy, a Reuters poll of economists showed on Thursday.

When asked how much of an impact the shutdown would have on US GDP for this quarter, forecasts by economists ranged between 0.1 and 1.3 percentage points.

The 100 economists in the poll expected the US economy to grow at a 2.1 percent annualized pace this quarter, down from 2.3 percent forecast last month, followed by 2.3 percent in the second quarter and then slowing to 1.9 percent by the end of the year.

The partial government closure has directly affects 0.5 percent of the US labor force but has started to indirectly hit the confidence of more than half of consumers, according to a survey by the University of Michigan.

The longest shutdown in US history is also beginning to have a political price. A majority of Americans hold Trump and his fellow Republicans in Congress responsible, according to several polls.

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