How Will a U.S. Government Shutdown Impact Global Mobility?

Once again, we find ourselves facing the prospect of a U.S. government shutdown and the consensus is that it is very likely to happen. Unless Congress passes a funding bill and President Trump signs it into law, the federal government will shut down at 12:01 AM ET on Wednesday, October 1, 2025 — the start of the new fiscal year. This marks the first potential shutdown under Trump's second administration and comes amid heightened tensions between Republicans and Democrats over healthcare policy and government spending.

With uncertainty looming, mobility professionals should understand how a shutdown could impact their global mobility programs and the employees they support. Below, we outline the key areas of concern and provide resources to help you navigate this challenging period.

What Makes This Shutdown Different?

This potential shutdown carries unique characteristics that distinguish it from past shutdowns:

• Mass Layoff Threat: The White House Office of Management and Budget has instructed federal agencies to prepare for permanent layoffs of employees working on non-essential programs, not just temporary furloughs. This represents a departure from traditional shutdown protocols.
• Reduced Federal Workforce: The federal government has already reduced its civilian workforce by approximately 3.2% since January 2025, creating additional strain on remaining staff.
• Missing Agency Plans: Unlike previous shutdowns, many federal agencies have not yet published their contingency plans on the OMB website, leaving employers and mobility professionals with less visibility into potential impacts.

Key Impact Areas for Global Mobility Programs

Immigration Processing

U.S. Department of Labor (DOL) — COMPLETE SHUTDOWN

The Department of Labor's Office of Foreign Labor Certification (OFLC) will completely halt operations during a shutdown, creating the most significant bottleneck for employment-based immigration:

• Labor Condition Applications (LCAs): No processing of LCAs required for H-1B, H-1B1, and E-3 petitions
• PERM Labor Certifications: All PERM applications suspended
• Prevailing Wage Determinations: No new PWD requests processed
• FLAG System Offline: The Foreign Labor Application Gateway will be inaccessible, preventing new filings

Action Item: Employers with time-sensitive H-1B petitions should rush their LCA filings to get them certified before September 30, 2025 at 11:59 PM ET. Any pending PERM or LCA applications with approaching deadlines should be prioritized immediately.

U.S. Citizenship and Immigration Services (USCIS) — CONTINUES OPERATIONS

USCIS is primarily funded through application fees, not congressional appropriations, so most operations will continue:

• Petition processing continues (H-1B, L-1, O-1, TN, etc.)
• I-485 adjustment of status applications continue
• Naturalization applications proceed
• Application and petition acceptance continues

However, certain programs may be affected:

• E-Verify System: Likely to be completely unavailable during the shutdown (see below)
• Conrad 30 Waiver Program: May experience interruptions
• Interagency information requests may be delayed, causing downstream processing delays

Historically, USCIS has provided temporary exemptions to LCA requirements when DOL shutdowns prevented timely certification. Monitor USCIS announcements for similar guidance.

U.S. Department of State (DOS) — LIMITED OPERATIONS

Consular operations are fee-funded and should continue:

• Visa processing and stamping continues
• Passport issuance continues
• U.S. citizen services abroad remain operational

However, expect potential delays due to reduced staffing and potential depletion of fee revenue if the shutdown extends. Visa applications requiring Security Advisory Opinions (SAO) or clearances from other agencies may face additional delays.

Customs and Border Protection (CBP) — CONTINUES OPERATIONS

CBP operations are considered "essential":

• All ports of entry remain open
• International airports continue operations
• Processing of travelers continues
• Canadian nationals may still apply for TN and L-1 status at the border, though delays are possible

Employment Verification

E-Verify System — LIKELY UNAVAILABLE

E-Verify is funded through appropriations and will likely shut down completely:

• Employers cannot create new cases or access existing accounts
• No ability to process E-Verify checks for new hires
• Pending Tentative Non-Confirmations (TNCs) cannot be resolved

Critical Reminder: Employers must still complete Form I-9 for all new hires on time, even if E-Verify is unavailable. Based on past shutdowns, DHS typically suspends the 3-day E-Verify rule and extends TNC response timeframes once the government reopens. USCIS has confirmed that employers may continue using the alternate document review process for remote I-9 verification even if E-Verify is temporarily unavailable.

Action Item: Employers should track all new hires during the shutdown and be prepared to create E-Verify cases promptly when the system comes back online. Maintain copies of I-9 documentation for easy submission once operations resume.

Social Security Services

Benefit Payments — CONTINUE

Social Security, Social Security Disability Insurance (SSDI), and Supplemental Security Income (SSI) payments will continue without interruption.

New Applicant Services — DELAYED

Services that will be suspended or significantly delayed include:

• New Social Security card issuance
• Benefit verification letters
• Earnings record corrections and updates
• Replacement Medicare cards
• Processing of new benefit applications

Impact on Assignees: Foreign nationals coming to the U.S. who need Social Security numbers to open bank accounts or get set up on payroll will face delays. The Social Security Administration estimates approximately 15% of its workforce (about 8,900 employees) will be furloughed, resulting in longer wait times even for services that continue.

Action Item: For employees arriving soon who need SSNs, consider alternative onboarding arrangements or temporary payment solutions until SSNs can be obtained after the shutdown ends.

Tax Services

IRS Operations — LIMITED CONTINUITY

The IRS has indicated it will remain operational by utilizing funds from the Inflation Reduction Act. However:

• Filing deadlines remain in effect (October 15, 2025 extension deadline still applies)
• Tax transcript requests may be delayed
• Customer service availability significantly reduced
• Income and Social Security number verifications for mortgage approvals may face backlogs

Travel and Transportation

Air Travel — CONTINUES WITH RISKS

TSA officers and air traffic controllers are considered essential personnel and must continue working without pay. However:

• Extended shutdowns could lead to increased sick-outs by unpaid workers
• Longer security lines and potential checkpoint closures
• Flight delays possible if air traffic controllers call in sick
• The U.S. Travel Association estimates shutdowns cost the travel economy $1 billion per week

National Parks — UNCERTAIN STATUS

Past shutdowns have seen varying approaches:

• 2013: Parks closed, 8 million recreation visits lost
• 2018-2019: Many parks remained open with limited services

Action Item: Advise internationally mobile employees to confirm visa appointments and avoid unnecessary international travel during the shutdown period, especially if they need new visa applications to return to the U.S.

Housing and Mortgage Impacts

Federal Housing Administration (FHA) — LIMITED OPERATIONS

FHA single-family loan endorsements will continue under multi-year appropriations:

• Single-family FHA loans will continue to be processed but with delays
• Limited FHA staff available for underwriting and approvals
• FHA Home Equity Conversion Mortgages (reverse mortgages) will NOT be processed
• FHA Title I loans (property improvements) will NOT be processed
• Multifamily housing projects may face suspensions

VA Loans — CONTINUE

The Department of Veterans Affairs will continue to guarantee home loans, though certificates of eligibility and reasonable value certificates may be delayed.

USDA Loans — SUSPENDED

The U.S. Department of Agriculture will not approve new housing loans or guarantees through its Rural Development programs during the shutdown. This averages approximately 218 loans per day that could be delayed.

Mortgage Verification Delays

Federal employees being relocated may face challenges:

• Employment and income verification delays
• Tax transcript delays from IRS
• Social Security number verification backlogs

Action Item: For employees in the home-buying process, especially those pursuing FHA or USDA loans, contact lenders immediately to understand potential impacts. Consider expediting documentation requirements before October 1. Employees who are federal workers should proactively communicate with lenders about potential income verification delays.

Economic Context

This shutdown comes during a period of economic vulnerability:

• Job market showing signs of weakness
• Inflation remains elevated
• Trump administration tariffs creating additional economic pressures
• Each week of shutdown is estimated to cost the economy $7 billion

Past shutdowns have typically had minimal stock market impact, but economists warn this shutdown could be more disruptive given the current economic fragility.

Duration Considerations

While many shutdowns have been resolved quickly, the Trump administration's longest shutdown lasted 35 days (December 2018 - January 2019). The current political impasse over healthcare policy and the 60-vote threshold required in the Senate suggest this standoff could be prolonged.

Recommended Actions for Mobility Professionals

Immediate Steps (Before September 30):

1. Identify employees with pending DOL applications (LCAs, PERMs, PWDs) and expedite filings
2. Review employees scheduled to arrive in Q4 2025 who will need Social Security numbers
3. Communicate with employees in home-buying processes about potential mortgage delays
4. Assess E-Verify new hire schedules and prepare contingency I-9 processes
5. Brief stakeholders on potential impacts to hiring and onboarding timelines

During Shutdown:

1. Monitor USCIS announcements for potential LCA exemptions
2. Track all new hires for E-Verify submission once system resumes
3. Maintain clear communication with affected employees
4. Document all delays for potential late-filing justifications
5. Continue completing I-9 forms on time regardless of E-Verify availability

Long-term Considerations:

1. Build buffer time into immigration timelines for potential government disruptions
2. Maintain relationships with immigration counsel for real-time guidance
3. Consider the impact of potential mass federal layoffs on your workforce
4. Develop communication templates for employees affected by shutdowns

Additional Resources

For continued updates and detailed immigration guidance:

• Fragomen: Preparing for a Possible Oct 1 Fed Govt Shutdown
• USCIS Website for official announcements
• Department of State Travel Website for visa and passport updates
• Committee for a Responsible Federal Budget for shutdown FAQs
• RisMedia: As Government Shutdown Looms, Mortgage, Real Estate Pros Brace for Potential Disruptions

Here's hoping that everything we just wrote about above does not come to fruition, but if it does, we have you set up for next steps!