The US government has been shut down for the first time in more than six years after Democrats and Republicans failed to agree on federal funding by midnight on October 1 (2pm today AEST).

Federal agencies were ordered to make preparations hours before the deadline, as hundreds and thousands of federal workers will have their pay impacted.

Here is exactly what that means. 

What is a government shutdown?

Federal agencies across the country will be shuttered, with non-essential workers, like park rangers, put on leave without pay.

Essential federal workers, like the military, immigration and airport security, will continue to work but will not get paid until after the shutdown.

About 750,000 workers will be furloughed each day in the shutdown, with the total daily cost of their compensation reaching $US400 million ($600 million), according to Congressional Budget Office estimates released yesterday.

Shutdowns usually arise over disagreements about the federal budget and can be used as a negotiation tool.

When was the last US government shutdown?

The last shutdown was sparked by US President Donald Trump’s multibillion-dollar request to build a wall on the US-Mexico border during his first term.

It lasted a historic 34 days from December 2018 to January 2019, with about 800,000 of the 2.1 million federal workers furloughed.

There were two other shutdowns during his first term, one lasting three days and the other lasting just several hours.

There have been 21 US government shutdowns in the past 50 years.

Former president Bill Clinton held the previous record of the longest shutdown in US history, 21 days in 1996.

Why is the US government heading towards another shutdown?

Democrats are fighting the Republicans on healthcare benefits and are making good on their threat to shut down the government if their opponents do not extend tax credits to subsidise health insurance.

Those credits are set to expire by the end of the year.

Both sides have been at an impasse in the days leading up to the start of the new fiscal year on October 1 — the date when the Senate was set to pass a new appropriations bill.

Senate Democratic Leader Chuck Schumer said Republicans are trying to “bully” Democrats by refusing to negotiate the extension and other priorities.

Trump and his fellow Republicans said they would not make any changes, arguing that their bill is a stripped-down and “clean” legislation that should be non-controversial.

Senate Republican Majority Leader John Thune said Republicans “are not going to be held hostage” by the Democrats’ demands.

This morning, the Republicans introduced a bill that would keep funding the government for seven weeks while legislators finish working on the appropriations bill, but it was voted down by the Democrats.

The Republicans hold the power in the Senate, but needed 60 votes to pass the bill, meaning some Democrats would have had to support it. 

It set the path for the shutdown. 

Federal agencies are making their preparations ahead of the start of the business day.

When does the shutdown start?

The shutdown started at 12.01am today (2.01pm AEST).

It’s hard to say how long the shutdown will last or what the effects will be, and it will largely rely on how quickly Democrats and Republicans can come to an agreement.

Previous shutdowns lasted an average of eight days. 

What makes this shutdown different from the others?

Trump has signalled that he may use a shutdown to cut the number of federal workers, ordering federal agencies to draft plans for sweeping layoffs if both sides cannot reach an agreement.

He said it could include “cutting vast numbers of people out, cutting things that they like, cutting programs that they like”.

The threat comes at the same time as more than 100,000 federal workers are set to resign from their roles after accepting Trump’s deferred resignation program as part of his effort to reduce the federal workforce.

It is shaping up to be one of the largest mass resignations in US history. 

Will a shutdown affect travel to the US?

No, immigration and airport security are deemed essential services and will continue to run throughout the shutdown.

It should not affect any Australians travelling to the US.

However, there may be limited federal services available while visiting the US.

— With Associated Press