For 43 days—longer than the biblical flood—the federal government was shut down because it failed to reach a budget or extend the time to do so. The government now has until Friday, January 30, 2026, to pass a budget for its fiscal year 2026 (ending September 30, 2026). The shutdown was a serious blow to the economy, with the Congressional Budget Office saying it likely cut growth for Q4 2025 in half, and that about $11 billion in economic activity would never be recovered. The impact on small businesses is not yet known.
In January 2019, we ran a blog on 5 Lessons from the Government Shutdown in that year when the shutdown lasted 35 days. Here’s how the 2025 shutdown affected small businesses…and the lessons you can learn from them.
Impact of the 2025 shutdown with lessons to learn for small businesses
Business travel
During the shutdown, thousands of airline flights were canceled and there were numerous delays. This clearly impacted business travel, including travel to see customers and vendors, travel for trade shows, business seminars, and other business events.
Lesson:
Sometimes, in-person business meetings are necessary, and any future shutdowns with travel disruptions will cause pain. But much of business travel can be averted by the use of Zoom or other online meeting options. This not only avoids the travel headaches and frustrations but also is much less costly.
Package and freight deliveries
During the shutdown, the U.S. Postal Service operated as usual, but disruptions in the air and ports due to staffing shortages have meant delays in deliveries. Overnight deliveries by FedEx and UPS were largely unaffected for flights outside the hours of FAA restrictions. The Bureau of Industry Security (BIS), which processes export licenses, suspended most of its activities.
Lesson:
Check all your shipment options to find the best one. Using more than one option may prevent disruptions for you. Be prepared to explain late deliveries to customers if your supply chain has been disrupted by the shutdown.
Government contracting
During the shutdown, new contracts and awards weren’t made, existing ones may have been put on hold or subject to stop-work orders, and payments weren’t made to contractors (with exceptions for those supporting “essential government activities”). Contracts with termination dates within the shutdown period may be over (will there be extensions?).
Lesson:
Recognize that shutdowns can occur again. There was a 16-day shutdown in 2013 under President Obama. There were two shutdowns—one for 3 days and one for 35 days—during President Trump’s first term. Will there be another shutdown starting January 30, 2026, if a final budget isn’t reached at that time? Small businesses that are contractors or subcontractors may want to diversity their businesses to also work with nongovernment customers.
Servicing government workers
During the shutdown, restaurants, salons, and other small businesses located near government offices and other facilities that rely heavily on government workers to patronize them saw their business fall off dramatically.
Lesson:
As the saying goes, when given lemons, make lemonade. That’s what some local businesses did by providing goods and other services to struggling SNAP recipients and others in need in their area because of the shutdown. These businesses may have garnered favorable word-of-mouth and/or local press for their businesses and earned a bucket of gratitude from those they served. Another lesson: businesses may be able to maintain revenues or minimize falloff by offering discounts, extend business hours, and give freebies.
Loans
During the shutdown, approval of SBA loans was suspended. In the government’s view, loan processing, underwriting, and approvals were non-essential operations in the government’s view, although some lenders continued to get documents ready for closing on a loan.
Lesson:
What to do depends on the urgency for funds. If they are needed immediately, then look for alternative lending options. They may be more costly than SBA-backed options but may be necessary under the circumstances.
Final thought
In the short term, what will the effects of the government shutdown be? How soon will normalcy return? Will consumers (especially government workers) spend less during the holiday season? The long-term effects of the government shutdown are yet to be determined.
What’s important is to keep George Santayana’s quote in mind:
“Those who cannot remember the past are condemned to repeat it.”
There’s likely going to be a government shutdown in the future, and you don’t want to be caught without a strategy to get through it successfully.
