The Economic Effects of COVID-19

Arya S., journalist

On February 18th Oxford Economics estimated that the coronavirus would cost the global economy more than one trillion dollars. If the virus were to be declared a pandemic today, most governments would be happy to take a trillion dollar loss since most corporations and notable investors—such as Ray Dailo—estimate that corporate losses would hit four trillion dollars in the US alone. 

Earlier this month, COVID-19 was declared a global pandemic by the World Health Organization. Soon after which the coronavirus wreaked havoc on daily life across the globe. COVID-19 has disrupted the plans of many organizations and individuals as governments around the world take unprecedented steps to prevent its spread, creating a massive uncertainty about what the future holds. 

Wall Street took a huge hit on March 18th, as Dow Jones—one of the most notable stock markers in the world lost—1300 points (-6.3%) on March 18th, due to the mounting fallout from the coronavirus pandemic.

The S&P 500 also took a huge toll due to fears over the virus and it was down by 5%. The tech industry also suffered when Nasdaq fell by 6%. 

While the coronavirus has taken a massive toll on the stock markets, local business and small companies may be even worse off. According to the National Restaurant Association, the restaurant industry has already experienced estimated losses of up to 225 billion dollars, as many restaurants have been forced to close for the forseeable future.. 

The unemployment rate for domestic workers will also likely be under severe pressure as many business owners are forced to lay off workers. The effects of these lay offs are already visible in California since many nonessential businesses have been closed.

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