Governance Capacity and Policy Impacts of U.S. Government Shutdowns: A Research Agenda

William G. Resh, Ph.D.

Civic Leadership Education and Research (CLEAR) Initiative
Sol Price School of Public Policy
University of Southern California

United States federal government shutdowns have long been viewed as signs of government dysfunction. As shutdowns increase in frequency and length for the US federal government, it is not difficult to postulate that such dysfunction might have an impact on the federal government in terms of its agencies’ relative ability to retain and recruit the talent necessary to prevent loss of capacity and further dysfunction. However, we know little about the effects of these phenomena on the US federal civil service labor market. This project explores the effects of shutdowns on agency policy implementation and personnel by using data from several different government sources that capture both elicited perceptions to observable behaviors. In so doing, we model the internal and external impacts of a government shutdown on both existing and prospective federal employees.

In the first series of analyses, we gauge the effect of shutdowns on both the perceptions of federal employees and their observable actions. First, we examine the 2018-2019 shutdown on specific elements of agency policy implementation. The results suggest that shutdowns, as a type of political shock, undermine the quality of government in the eyes of those closest to the work. The second and third studies consider the effect of shutdowns on employee morale, using the 2013, and 2018-2019 shutdown. While our findings indicate that the 2013 shutdown wrought durable negative impacts on the morale of shutdown agency personnel, that event appears to have prepared agencies to absorb any negative morale impacts in the 2018-2019 shutdown. Our study shows both the immediate and long-term dynamics of government shutdowns on policy implementation and the administrative workforce.

In the second series of analyses, we examine the effects on the inflow and outflow dynamics of the federal labor market using (among other data) US Office of Personnel Management’s (OPM) Enterprise Human Resource Integration (EHRI) data of several million federal employee observations and several hundred thousand applicant observations from USAJobs.gov and USAStaffing.gov across open lines in the federal government from 2018 to 2023. We focus on the 2018-2019 shutdown and its intervening impact of the 2018-2019 shutdown on the federal labor market.

Through the collection of agency contingency plans and FOIA responses, we are able to account for the relative intensity of the shutdown’s “intervention” by the extent to which an agency’s workforce was furloughed. Whereas some shutdown agencies’ operations were truly shut down by a completely furloughed workforce, other shutdown agencies were curtailed by less than 100% furloughed employees.

In terms of outflows, all separations from a federal government organization are not the same. Political principals may reorganize agencies in reaction to the shutdown. Such reorganizations can take the form of mass transfers of talent to other agencies or by reductions in force (RIF). Employees may leave through their own discretion by means of transferring out of an agency to another agency within the federal government, early retirement, regular retirement, or by exiting the federal government by resignation. Each form of employee turnover impacts an agency as a loss of existing capacity in different ways, and each form is affected differently by a government shutdown. However, we know little about the heterogeneous effect of shutdowns on different forms of employee outflow. Indeed, little research has been conducted on how political environments affect employee turnover.

On the demand side, agencies may acquire capacity by way of new hires, through contracting out to private sector organizations, or through the direct transfer of extant federal civil servants from other agencies. However, all acquisitions are certainly not the same either. Contracting out can reduce an agency's internal operational capacity, new hires can vary in strength as a function of market competitiveness, and acquisitions can be made from within the federal government through transfers by the agency's own initiative or by fiat through executive or legislatively designed reorganizations.

In sum, government shutdowns have immense influence on public personnel management. In this research agenda, we analyze how agencies strategically change separations and accessions (demand side of labor) and examine how this may affect potential applicants of public service (supply side). We expect that such a comprehensive approach will contribute to the executive politics and public administration scholarship along with providing important insights for practitioners.