Are we talking about an economical pandemic?
March 16, 2020
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The COVID-19 has brought so much more impact than a sanitary emergency. This pandemic affected economical activities worldwide. For example, in Wuhan - which is an industrial centre for economic wealth - the manufacturers stopped its production of car pieces, technological gadgets, cellphone pieces, etc. This situation was experienced throughout the world in different industries, breaking the production chain.
Within a few days, most companies of services and products companies have been demanded to remain closed until the undefined quarantine is over. In addition to that, this industrial reality is also affecting the rate of employment in the industry and is leaving many families without income and economical support. American workers are now more vulnerable than ever.
How are industries getting affected?
The virus has spread rapidly in different parts of the world. The main reason? People moving around the world have brought the virus from one country to another, making the number of infections grow exponentially within days.
To avoid this situation to get worse, the president Donald Trump prohibited the arrival of any tourists from Europe - one of the most affected areas - to the US. This measurement of prevention will not be cheap. In fact, it will cost around 100,000 million dollars according to the International Air Transport Association (IATA). But airlines are not the only ones affected. Cruises and long-distance trains had to also stop its operations.
Hotels and other tourism services have also decreased their operations at its minimum or in its totality. Most concerts, shows, and social gatherings in general have been cancelled or rescheduled, which also gets in trouble with the entertainment companies to afford the cost that it brings.
As a result of this, 31.5 million employees - most of them from front-line or customer-facing jobs - had their hours lowered and the wages have decreased as well. We are talking about more than 57% of the american population having their employment status affected by this pandemic, which puts the economic situation in a severe problem.
Retail companies are also seeing a blurry scenery for the upcoming weeks. Let’s take the example of Apple, which has closed all their stores around the world - except from the ones in China - as a result of the incapability of production and operation. Like this company, many retailers had to temporarily close their doors and focus on creating and adapting a crisis management plan for the short-term future.
What comes next?
Specialists confirm that the COVID-19 have cost the US economy approximately $17 billion in gross product in the last 3 days. Wall Street has fallen exponentially and it doesn’t seem to improve in the next few days.If things continue the way they are, in only March, Coronavirus is expected to cost $120 billion. This amount represents about 2.3% in GDP, which can lead to a serious recession. The only way to fight against this situation, is that the presidents and the government get prepared for a wise fiscal stimulus package of at least $400 billion for next month.
However, the focus of the government is to empower the medical sources in order to fight against this pandemic the right way. Ensuring the health of the american population will allow us to fix the economic crisis and rise again. But without health, it will not be possible and, unfortunately, Coronavirus would win the war. Let’s not let that happen to American or our world either.