By Nikki Johnson, Regional Economist
The federal government shutdown is now the longest in U.S. history. Federal civilian employees are either furloughed or working without pay while active-duty service members were expected to miss their first full paycheck this month. The shutdown has slowed many routine federal payments, including some contracts and disrupted key safety net programs, such as the current pause in SNAP benefits. An end, however, appears to be in sight, bipartisan action in the Senate has advanced a funding resolution that would reopen the government, guarantee back pay for workers and extend funding through January 30, 2026.
Few places feel the impact of the shutdown more sharply than Hampton Roads. The region is home to one of the largest concentrations of federal workers in the nation, with about 60,000 civilian employees and 85,000 active-duty service members. Federal pay and contracting support a large share of the region’s economic activity, so even brief interruptions can have noticeable effects. One way to gauge the ongoing impact on federal employees is through unemployment benefits. A continued claim for unemployment insurance represents an employee who has already filed an initial claim for unemployment benefits and remains unemployed. While local data is not available, statewide figures for Virginia provide useful insight. As illustrated in Figure 1, federal continued claims were already rising prior to the shutdown due to ongoing efforts to reduce the size of the federal workforce. Since the shutdown began, the number of federal workers receiving unemployment benefits has more than doubled. These estimates, however, likely understate the total number of affected employees, as some may choose not to file as these benefits must be paid back once backpay is issued.
The shutdown’s reach extended beyond the federal workforce and contracting. On November 1, the Supplemental Nutrition Assistance Program (SNAP) failed to issue benefits for the first time in its six-decade history. As it appears the end of the shutdown is now here, full SNAP payments will resume, but states and households have faced significant uncertainty during the pause. The region is home to a higher share of SNAP recipients relative to the state.
Source: Department of Labor (DOL), Virginia Department of Social Services, Economic Policy Institute, and HRPDC.
As illustrated in Figure 2, in September 2025 nearly 200,000 residents in Hampton Roads, or 11.3 % of the population, received SNAP benefits compared with 9.7 % statewide. Nationally, USDA estimates that roughly 12 % of the population received benefits in FY 2024. The shutdown’s economic impact extends beyond federal workers and assistance programs. Missed paychecks and delayed payments have a ripple effect through the economy, reducing household spending and slowing business activity. These effects intensify the longer payments are delayed. The Congressional Budget Office estimated that a six-week shutdown would lower the annualized growth rate of U.S. real GDP in the fourth quarter of 2025 by 1.5 percentage points. For regions like Hampton Roads, where federal spending is a key driver of the economy, the local impact is likely to be even greater.