House Returns Amid Partial Government Shutdown

 

Washington Update​

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February 2, 2026

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Appropriations

On Friday, January 30, on a vote of 71-29, the Senate passed a $1.2 trillion spending package that maintains current funding levels for most federal agencies through September while extending current funding for the Department of Homeland Security for two weeks to allow for further negotiations over immigration enforcement. Despite passage, a partial shutdown started early Saturday morning since the House was in recess, and is expected to last until at least Tuesday, when the House is scheduled to vote on the package. 

 

Agencies impacted by the partial shutdown include the Departments of Labor, Education, Defense, Financial Services, Health and Human Services, Homeland Security, Housing and Urban Development, Transportation, as well as related agencies and programs. A prolonged shutdown could significantly disrupt operations at the the Department of Labor and the National Labor Relations Board and delay the release of key economic data from the Bureau of Labor Statistics (BLS), though some BLS-related functions remain funded through previously enacted legislation.

 

The legislation will move through the House Rules Committee before advancing to the House floor for a vote. While the package requires only a simple majority and is expected to pass, opposition from some House Democrats and the narrow GOP could create potential obstacles to final passage. The agreement would complete more than 95 percent of federal funding for the fiscal year, leaving negotiations over a long-term DHS funding bill as the primary unresolved issue. The shutdown’s impact is expected to be limited, with employees furloughed for only a short period of time with minimal disruption to services.

 

On Monday, February 2, the Department of Labor (DOL) released Training and Employment Notice (TEN) 05-25 outlining the impact of a temporary suspension of federal government services on DOL’s Employment and Training Administration and Office of Career, Technical, and Adult Education funded programs and activities.

 

Click here to access the TEN.
 

Departments of Labor, Education Alignment

 

On Monday, January 26, the U.S. Department of Labor (DOL) Employment and Training Administration (ETA) released the Training and Employment Guidance Letter (TEGL) “Modification Requirements for Workforce Innovation and Opportunity Act (WIOA) State Plans for Program Years (PYs) 2026 and 2027.” Issued jointly with the Department of Education (ED), the guidance is intended to support states in updating their WIOA State Plans and advancing greater alignment across federal workforce and education programs.

The TEGL builds on recent efforts to streamline administration and improve coordination, including the transition of the WIOA State Plan Portal to DOL, alignment of grant and payment systems, and clarification of available waivers and flexibilities. It encourages states to use the plan modification process to strengthen integration among WIOA programs, adult education, career and technical education, and vocational rehabilitation, with a focus on aligning training with in-demand occupations and recognized credentials.

 

Click here to access the press release.

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Senate HELP Committee Task Force

 

On Monday, January 26, Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Bill Cassidy (LA) announced the creation of a task force to address fraud in the use of federal funds, including education spending. The task force will include subcommittees focused on Health, Labor and Pensions, and Education. Senators Jon Husted (OH) and Tommy Tuberville (AL) will lead the Education anti-fraud efforts while Senators Markwayne Mullin (OK) and Tim Scott (SC) will lead the Labor & Pensions subcommittee.

 

Committee Republicans cited prior investigations in Minnesota as a factor informing the initiative, pointing to weaknesses in oversight of federal grant programs. Those investigations included fraud involving a nonprofit that improperly claimed hundreds of millions of dollars in federal meal reimbursements, prompting federal agencies to freeze some funding and increasing scrutiny of state oversight practices.

 

An April 2024 Government Accountability Office (GAO) report estimated that the federal government loses between $233 billion and $521 billion annually to fraud. Separately, the U.S. Department of Education has reported significant losses in federal student aid due to fraudulent activity, including false student identities and administrative errors, which has reinforced calls for stronger fraud prevention measures.

 

Click here to access the press release on the task force.

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House Education & Workforce Subcommittee Hearing

 

On Tuesday, February 3, at 10:15 am, the House Education and Workforce Subcommittee on Health, Employment, Labor, and Pensions will hold the hearing “Building an AI-Ready America: Adopting AI at Work.”

 

Click here to learn more and access a livestream of the hearing.

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H-2C Visas

 

Restaurant owners and construction industry groups are urging Congress to expand legal pathways for foreign workers as stepped-up immigration enforcement intensifies labor shortages in service and building trades. Their efforts center on Congressman Lloyd Smucker’s (PA) bill, the Essential Workers for Economic Advancement Act, introduced in September, that would establish a new H-2C visa category, allowing nonagricultural employers to hire foreign workers after demonstrating unsuccessful efforts to recruit U.S. workers.

 

Industry data indicate significant workforce gaps, particularly in construction, where hundreds of thousands of additional workers are needed to meet current demand. Some lawmakers have raised concerns that immigration raids have disrupted job sites and constrained local economies, prompting calls for federal agencies to consider the labor impacts of enforcement actions.

 

The proposal has received limited bipartisan interest and faces significant obstacles, including a lack of Republican leadership endorsement, historically narrow support for visa expansions outside agriculture, and mixed signals from the Trump Administration. Industry groups warn that continued labor shortages could constrain construction activity, drive up costs, and affect housing supply and broader economic growth. 

Click here to access the press release on the legislation.