The federal government shutdown entered its 24th day on October 25, 2025, but this is not a standard funding lapse. While the Department of Government Efficiency keeps all 45 of its staff working, over 4,200 federal employees received reduction-in-force notices before federal courts intervened. The Department of War redirected $8 billion from research and development accounts to military payroll, bypassing Congressional oversight. For federal IT executives and acquisition professionals at DoW, HHS, VA, and DHS, the implications demand immediate strategic response.
The Modernization Freeze
Timothy Amerson, former acting CISO with a major federal agency and current federal government strategic advisor at GuidePoint Security, describes the damage clearly: non-essential IT modernization projects have stalled, creating backlogs in infrastructure upgrades, cloud migrations, and system updates. Every delay day compounds legacy system challenges and drives up future costs.
Vulnerability analysts and incident responders are among the first affected, eroding resilience during a critical period for AI integration and quantum computing preparation. Contractors face payment delays that threaten workforce retention. The Small Business Innovation Research program requires reauthorization and cannot award new contracts until Congress acts.
Agency-Specific Impacts
Department of War IT projects supporting border operations, Middle East missions, depot maintenance, shipbuilding, and critical munitions continue. Everything else faces indefinite delays. The $8 billion R&D redirect will impact ongoing development programs, though the War Department has not disclosed which initiatives suffer.
At HHS, 41 percent of 80,000 employees are furloughed. The CDC, HRSA, and AHRQ lost up to 1,200 staff through RIF notices. FDA continues user fee-funded reviews but accepts no new submissions requiring fees.
VA retained 97 percent of its workforce, maintaining medical facilities and benefits processing. However, EHR modernization faces compounding problems after terminating six SDVOSB support contracts earlier in 2025. The Oracle-Cerner system has experienced 826 major performance incidents since 2020, some linked to patient harm.
DHS continues border security operations, but CISA initiated RIFs affecting cybersecurity staff. The 40,000 Coast Guard members work without pay, unable to file for interim financial support.
The Acquisition Workforce Crisis
The most troubling development affects the acquisition community. GSA’s Federal Acquisition Service furloughed staff funded through the Acquisition Services Fund—a revolving fund normally exempt from shutdowns. Phased furloughs will send additional waves home if the shutdown extends beyond early November. Federal contractors face stop-work orders, payment delays, and workforce retention challenges.
Phased Implementation Recommendations
Federal IT executives need structured responses adapted to evolving circumstances:
Phase 1: Identify mission-critical functions and ensure excepted status documentation. Engage contractors on retention strategies and document all shutdown impacts for potential cost recovery.
Phase 2: Prioritize user fees, carryover appropriations, and non-lapsed funding for essential modernization. Implement minimum viable cybersecurity operations.
Phase 3: Create rapid restart procedures for stalled projects. Assess contractor availability after extended pauses. Update timelines and budget requirements based on actual delays.
Phase 4: Resume modernization with updated risk profiles. Implement lessons learned into contingency planning. Restore acquisition workforce capacity through strategic hiring where permitted.
The Path Forward
This shutdown represents unprecedented use of funding lapses for permanent workforce restructuring. The agencies that navigate this crisis successfully will implement structured continuity frameworks, maintain stakeholder communication, and document everything for recovery. Federal IT leaders cannot simply pause operations when mission-critical systems require continuous protection and cybersecurity threats observe no shutdowns.
Sources
The Register, “IT modernization plans will stall during government shutdown,” October 1, 2025, https://www.theregister.com/2025/10/01/us_government_shutdown_it_seccurity/
Breaking Defense, “Pentagon to shift $8B in R&D funds to pay troops,” October 20, 2025, https://breakingdefense.com/2025/10/pentagon-military-pay-shutdown/
Bloomberg Government, “White House Keeps 45 DOGE Employees Working Despite Shutdown,” October 3, 2025, https://news.bgov.com/bloomberg-government-news/white-house-keeps-45-doge-employees-working-despite-shutdown
Government Executive, “Trump’s promised shutdown layoffs lead to at least 4,200 cuts at seven agencies,” October 11, 2025, https://www.govexec.com/workforce/2025/10/substantial-layoffs-begin-federal-agencies-white-house-says/408752/
Center for Strategic and International Studies, “How Does the Government Shutdown Impact the U.S. Industrial Base?” October 10, 2025, https://www.csis.org/analysis/how-does-government-shutdown-impact-us-industrial-base
Federal News Network, “Furloughs hit federal employees exempt from shutdown, laid-off staff told to keep working,” October 3, 2025, https://federalnewsnetwork.com/government-shutdown/2025/10/furloughs-hit-federal-employees-exempt-from-shutdown-laid-off-staff-told-to-keep-working/
