Will Retail Be Impacted by Government Shutdown?
Government Shutdowns Can Have Ripple Effects on Retail

By the D&D Daily staff

As Congress continues to debate funding bills, questions often arise about how a potential government shutdown may impact industries beyond federal agencies. For the retail sector, the effects are indirect but can be significant, particularly if a shutdown is prolonged.

One of the most immediate impacts comes from reduced spending power among federal employees and contractors. During a shutdown, hundreds of thousands of federal workers may be furloughed or required to work without pay. Many scale back purchases until back pay is distributed, which can temporarily reduce sales, especially in areas with a high concentration of government workers. Retailers in the Washington, D.C. metro area, for example, often report noticeable dips in sales during extended shutdowns.

Broader consumer confidence can also be affected. Shutdowns typically dominate news coverage and create uncertainty about the stability of the federal government. When confidence slips, households often reduce discretionary spending, which can slow retail activity nationwide. This impact may be most visible in non-essential categories such as apparel, electronics, and dining out.

Retail operations and supply chains can also feel the strain. Federal agencies that regulate and oversee product testing, labeling, and inspections often scale back activity during shutdowns. Delays at agencies such as the Consumer Product Safety Commission (CPSC), Food and Drug Administration (FDA), or U.S. Department of Agriculture (USDA) can slow the flow of goods, particularly for retailers that rely on new product launches or perishable items. While ports of entry remain open, paperwork and processing may take longer, creating bottlenecks.

Shutdowns can also influence financial markets. Retailers reliant on credit or investor confidence may face tighter conditions if a shutdown contributes to market volatility. In addition, tourism-related retail suffers when national parks, monuments, and federally funded attractions are closed, reducing foot traffic for local businesses.

For retailers, the ultimate impact depends on the duration of the shutdown. Short disruptions may have minimal long-term consequences, with consumer spending rebounding once federal employees receive back pay. Longer shutdowns, however, can create more lasting challenges for retailers already managing thin margins and shifting consumer behavior.


OSHA & Workplace Safety 'Heavily Impacted' by Shutdown
How Will the Government Shutdown Affect Workplace Safety?

OSHA and other safety agencies are expected to be heavily impacted by the shutdown.

With neither party willing to give an inch, the US Congress has reached an impasse that will cause the federal government to effectively shut down many of its services. The immediate result will be the furloughing of roughly 750,000 federal employees, which includes employees of the Labor Department’s Occupational Safety and Health Administration (OSHA).

According to a briefing provided by law firm Fisher Phillips, OSHA is expected to be “heavily impacted by the shutdown.” Pointing to previous shutdowns as precedent, Fisher Phillips notes that nearly 90% of OSHA employees were furloughed in the past, leaving just area directors and assistant area directors to do most of the work. “We expect to see OSHA only opening up between 15-20% of the number of inspections that would normally occur during any shutdown if history is any guide,” the law firm stated in its briefing.

Inspections will be severely curtailed, other than those for “workplace fatalities, catastrophes and imminent danger situations.” Since state OSHAs receive significant funding from federal OSHA, their operations will also be impacted.

In its briefing, lawfirm Littler explains that the impact of the shutdown “could be substantial for those employers navigating a federal OSHA enforcement action or involved in litigation. While contest and abatement deadlines will continue during the shutdown (even though OSHA personnel may not be present), employers likely will not be able to engage with OSHA via an informal conference or otherwise during the shutdown. Further, there will likely be delays and continuances in hearings, settlements, decisions, and mediations until the shutdown can be resolved.”  ehstoday.com


Just 22% of Shoppers Plan to Spend More This Holiday Season
More than a quarter of consumers plan to cut holiday spending

Only 22% of shoppers are expecting to spend more this holiday season compared to last year, according to a recent report from Experian.

Just 22% of U.S. consumers plan to spend more this holiday season, and 27% expect to spend less, according to a national survey from Experian in conjunction with ad platform GroundTruth.

Nearly 40% of those surveyed will split their retail shopping experience between online and in-store, and almost half (45%) say they will start shopping for the holidays before November, while most will finish in December.

While other research has indicated that AI is having an impact on the way some consumers shop this holiday season, only 12% of shoppers expect to use it for their holiday purchases, per the Experian report. retaildive.com


Facial Recognition Use Becoming More Common
Smart vending machine uses facial recognition to verify age for THC products
A smart vending machine at an Austin shop is using facial recognition and ID scanning to ensure customers are 21 or older before purchasing consumable hemp products with THC, according to a Spectrum Local News report.

The machine, developed by Leaf and Legends owner Nick Mortillaro, dispenses items such as gummies, pre-rolls and beverages. The technology requires customers to scan their face and a government-issued ID. The machine only charges the credit or debit card and dispenses the product if the facial scan and ID match.

Mortillaro said he hopes the technology can help businesses comply with Gov. Greg Abbott's executive order calling for rules to prohibit minors from purchasing consumable hemp products.

"It's really the integration of the age verification to the smart vending kiosk to allow the whole system to be compliant," Mortillaro told the news report. kioskmarketplace.com


Food Retailers Sound the Alarm
New SNAP restrictions to cost retailers billions, say food retail associations
Food retail leaders are sounding the alarm about the impact of new restrictions on Supplemental Nutrition Assistance Program (SNAP) benefits.

The National Association of Convenience Stores, National Grocers Association, and FMI – The Food Industry Association, released the “SNAP Restrictions Impact Analysis,” which estimates the significant costs food retailers will face under proposed restrictions from the Trump Administration’s Federal spending bill. New SNAP Food Restriction Waivers will restrict the purchase of non-nutritious items like soda and candy.

The Impact Analysis from the three organizations reveals that the total up-front cost from SNAP restrictions is projected to be $1 billion for convenience stores, $305.1 million for supermarkets, $11.8 million for small-format stores, and $215.5 million for supercenters. The total cost across all channels is expected to be approximately $1.6 billion, which is equal to 1.9% of 2024 net income for all food retailers. chainstoreage.com


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