The federal government shutdown offers crucial lessons for corporate executives on crisis communication. It underscores the importance of proactive planning for foreseeable conflicts, maintaining authentic and continuous stakeholder engagement, and the significant risks of silence, which can lead to damaging speculation and loss of trust.
The shutdown of the federal government that began on October 1 is providing important lessons for corporate executives about communicating about crisis situations.
In the eye of one observer, the new shutdown was avoidable and illustrates the costliest type of crisis -- the one that can be predicted. "Business leaders should take note -- when you know a collision is coming but fail to course-correct, you're not managing a crisis, you're manufacturing one. The lesson is clear: address foreseeable conflicts early, build consensus before deadlines hit, and never mistake procrastination for strategy," Nicholas Creel an associate professor of business law at Georgia College and State University, told me in an email message.
Silence by companies and organizations about the latest government shutdown is "most common in industries that rely heavily on federal funding such as defense, transportation, health care and research, to name a few. Big names like Lockheed Martin [and] Boeing ...fall silent when a shutdown hits...This is prudent risk management, not apathy. It becomes more difficult, though, the longer the shutdown drags on as employees, suppliers, and customers start feeling the strain," Lakesha Cole, founder of She Spark Media, told me in an email interview.
When executives don't have a full sense of how a crisis will affect their companies and don't have good information about the situation, "sometimes silence is the best communications strategy for highly regulated companies in highly regulated industries," she observed.
Lockheed Martin and Boeing did not immediately respond to requests for comment for this story.
Sometime the organizations whose members have the most to lose can be faster to respond to a shutdown than others. Research!America, a non-profit medical and health research advocacy alliance, said on its website when the government suddenly closed down that "Among the many ways Americans are harmed by this shutdown, the National Institutes of Health (NIH) cannot move forward to fund research. As the clock ticks, patients -- people in our families and communities -- wait."
Research!America stayed true to its advocacy mission by urging the president and congressional leaders "to come back to the table immediately to end the shutdown and complete the Fiscal Year 2026 appropriations process. Health threats are ruthless. Our nation needs to fight them full force, not take a pause. We need quick action by Congress and the administration to bring NIH and other federal research agencies back online. And we need an updated, full-year federal spending plan that propels American science forward."
There can be risks for those who, for whatever reason, decide to stay on the sidelines. When organization go silent about a crisis, "the public will always fill in the blanks and fill the vacuum with speculation, fear, and frustration. And once that narrative takes hold, it moves faster than any official statement. That silence doesn't just damage confidence; it reshapes it," Cole concluded.
Continuous communication with those who are affected by a crisis is critical. "Communicate with authenticity and maintain continuous touchpoints with stakeholders. That means telling your employees, customers, and vendors on a set schedule, even if the update is 'no change' -- silence creates panic. For example, in the 2018-2019 35-day shutdown, companies that emerged as winners were the ones that communicated from day one, starting with a 'who gets paid first; plan and a short term cash bridge for the crucial vendors," Sharon Kodan, a crisis communication expert, advised in an email interview with me.
The federal shutdown is "a stark reminder for leadership and their communications teams to plan for stops and starts. For starters, create a list of where your business touches the government and that includes permits, inspections, data, contracts, and so on. What you need to do is make a backup for each one so you can run for 30-45 days if they pause," Kodan advised.
"The next course of action is to communicate with authenticity and maintain continuous touchpoints with stakeholders. That means telling your employees, customers, and vendors on a set schedule, even if the update is 'no change' -- silence creates panic. For example, in the 2018-2019 35-day shutdown, companies that emerged as winners were the ones that communicated from day one, starting with a 'who gets paid first' plan and a short term cash bridge for the crucial vendors," she recommended.
Both political parties "believe they have the moral high ground. Republicans are asking for a clean continuing resolution. Democrats are asking for ways to keep healthcare costs down. Both will please their bases. But key here is how they can articulate their case to neutrals beyond just blaming the other side. In business, leaders need to clearly explain the rationale including values that are worth standing to principles and risk. The court of public opinion matters but leaders need to make case to jury," Jeff Le told me in an email interview. Le negotiated disaster funding with Trump administration on behalf of governor of California during last government shutdown in 2018-2019.
In any crisis, creating and controlling the narrative can be critical crisis communication success factors.. "It is important for business leaders to proactively shape their narrative -- using your own platforms, staying consistent with a few core themes, and building strong media relationships. Business leaders who do this well are more likely to have their reputation defined on their own terms," Vishakha Mathur. Vice president of SKDK,told me in an email message.
"In high stakes negotiations,such as current federal government shutdown or contract negotiations between large corporations and labor unions,both sides know that conflict will end with negotiated agreement while trying to use crisis as leverage to improve negotiating positions," Moshe Cohen,author of "Collywobbles: How to Negotiate When Negotiating Makes You Nervous,"told me in an email message.
'Like politicians,business leaders in such situations must calculate balance between benefits of continuing standoff and increasing costs to various stakeholders.Too often,while helping one party achieve some advantage over other,this approach to negotiations weakens both parties,making them vulnerable to outside threats,so it should therefore be applied infrequently,and with great caution,"he advised.
The longer the government shutdown continues,the worse it will get for federal workers,members of military contractors vendors,and millions of people who rely on federal programs that are directly effected by the crisis.
When the government re-opens,companies and organizations should consider conducting an objective reality check on how they communicated about the crisis --and determine if they should do anything different the next time federal departments and agencies suddenly close their doors.