The traditional short-run shutdown condition, that firms should halt production if revenues do not cover avoidable costs, is incorrect when there are irreversible investments such as firm-specific investment in human capital. The actual shutdown price may be far below the traditional shutdown price and relatively modest declines in demand may drive revenues below avoidable costs. We examine in a panel of over 130,000 quarterly observations covering most sectors of the U.S. economy. We find that large operating losses are common and occur in a predictable pattern across firms, industries, and time, and temporary firm shutdowns are uncommon. Our findings suggest that it is common for firms to operate when they are not covering their avoidable costs of production.