During the 1918 influenza pandemic shopkeepers and other public gathering places all saw a sharp decline in business. The world economy has changed dramatically since 1918 but the results could be the same.
The World Bank, has estimated that a Coronavirus pandemic lasting a year, could cost the global economy up to $800 billion. The economic toll on the world economy will be catastrophic.
What if it is mainly contained to Asia? Will we then only have a “mild” pandemic? How many factories in Asia are producing goods for the U.S. market? How many workers are producing those goods? The people working in those factories are mainly young women who work 10-hour days for $45 a month. The conditions they work in are not always the healthiest. They can’t afford to take time off if they get sick. What if a large factory loses 10% of its workforce or 20% or 50%? How long before Walmart and other retailers no longer have anything to put on the shelves? Ill factory workers in Asia will create an economic tsunami that will hit the United States very hard. Truckers will have nothing to deliver, retailers will have nothing to put on their shelves, and consumers will experience shortages, which will lead to panic buying and fear of running out.
Manufacturers who receive parts and raw materials from overseas suppliers will also be affected. If you have no “just-in-time” delivery, layoffs are sure to follow.
These scenarios are assuming a Coronavirus pandemic is contained outside the U.S. If we have a full scale pandemic the whole economic picture gets a lot murkier. Many of the same effects will be felt but then it will start to affect all U.S. businesses from travel and tourism to manufacturing to anywhere the public gathers. Movie theaters, sports stadiums, fairs would all be shut down to help contain the spread of influenza. What is the economic tsunami effect of that happening? The potential for a Coronavirus pandemic is very real. The economic consequences would be catastrophic. You need to stay informed about Coronavirus and how to prepare for a pandemic.