The October 1 shutdown of the federal government could delay the announcement of the annual Social Security cost-of-living adjustment (COLA). This highly anticipated announcement usually occurs on October 15, but could be delayed in 2025. However, an increase in Social Security benefits as a result of the COLA is still expected to take effect in January, as planned.
The longest government shutdown lasted 35 days.
I want to be clear that a shutdown will not impact the payment of Social Security benefits to any recipients. Retiree benefits, disability payments, and Supplemental Security Income (SSI) will be paid in full and on time with no changes to SSA's 2025 payment schedule.
The main reason for a potential delay in the announcement is a disruption in the collection of essential economic data. The government shutdown resulted in the furlough of most Bureau of Labor Statistics (BLS) staff, leading to the suspension of data collection, processing, and scheduled releases, including the September CPI-W. The September CPI-W is the last piece of data needed to calculate the COLA.
This delay impacts more than the COLA announcement. The new numbers are also used to calculate the limits for the Social Security earnings test and the tax wage cap for 2026.
The missing piece of data
The Social Security COLA is calculated automatically based on the year-over-year change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The calculation compares the average CPI-W for the third calendar quarter, which includes July, August, and September of the current year, to the third-quarter average of the last year. While we have the data for July and September, the October report was scheduled to be released on October 15. Based on two months of the required data, the estimated 2026 COLA sits at 2.7%.
The Bureau of Labor Statistics (BLS), which is part of the Department of Labor, is responsible for collecting, processing, and publishing this crucial inflation data. The final piece of data needed for the calculation—the September CPI-W report—is on hold until the shutdown ends.
No data, no COLA announcement
Since the Social Security Administration (SSA) cannot finalize the COLA without the official September CPI-W figure, the typical mid-October announcement will be delayed until the BLS resumes operations and releases the required data.
The length of the COLA announcement delay is entirely dependent on how long the government shutdown lasts. Once funding is restored, the BLS will work to process and release the delayed economic reports.
Status During Shutdown |
Why? |
|
Social Security Checks |
Not Delayed |
Social Security benefits are funded by dedicated trust funds (mandatory spending) and are not subject to the annual appropriations process. Payments continue as scheduled. |
COLA Announcement |
Could be delayed |
The SSA cannot announce the COLA until the BLS releases the September inflation data, which may be paused. |
COLA Effective Date |
Not delayed |
Once the government reopens, the data is released, the COLA is calculated retroactively, and it will still take effect in January (for the benefits received in January). |
90 days remain until COLA adjustments take place
Once the shutdown ends and the COLA is calculated and announced, the new benefit amount will still take effect with the January Social Security payments. So far, a delay is only expected in the announcement of the percentage, not the application of the increase itself.
Until then, tens of millions of beneficiaries will remain in suspense about the exact size of their benefit increase.
