The coronavirus pandemic has affected world economies over the past year, and as countries continue to develop vaccines to mitigate its effects, its impact in the U.S is unmeasurable. Arguably, the immense impact of the coronavirus on the U.S economy is disruptive. It has disrupted the economic flow of goods and services in and out of the country (Walmsley et al., 2020). Additionally, the coronavirus pandemic has led to massive job losses in the labor market. Despite massive efforts being undertaken to implement monetary policies, economic relief packages, and health measures, the country is yet to recover its economic prowess. Given the uncertainty of the pandemic, the risks presented were far much greater for many financial markets. While the Congress and U.S federal administration put monetary policies to cushion businesses from the coronavirus impact, the damage was already done. Regardless of the partial reopening of businesses and industries, the impact of the coronavirus pandemic on the economic front was far much greater in the U.S.
Assessing the impact of the coronavirus pandemic on the U.S economy needs to focus not only on the virus and its epidemiology but also on how the government and the private sector are responding to it. According to Walmsley et al. (2020), the U.S is estimated to lose over $3 trillion from the closure of businesses and supply chains since the onset of the pandemic. Major factors contributing to the decline in economic growth are the mandatory closure of businesses and cross-border supply chains. Additionally, the authors note that high morbidity and mortality rates, especially from the workforce, also decreased economic progress. During this pandemic period, most industries closed down as others opted to work remotely. Reduced workflow is detrimental to the overall productivity of a country. Arguably, as the pandemic significantly impacted the labor market, both the public and private sectors incurred massive losses. If the industrial sector is not performing at par, the economy does not achieve massive gains.
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Taking notes from previous pandemics, the U.S quickly implemented some health and economic-related measures to safeguard the economy from a total collapse. However, while these containment measures were necessary, they took a toll on the economy. In their article The Economic Impact of Coronavirus in the U.S. and Possible Economic Policy Responses , authors Vinelli & Weller (2020) acknowledge that the coronavirus pandemic has forced industries to shut down their business processes, and “these disruptions make it more difficult for companies in the U.S. and elsewhere to bring their goods to customers, and these companies will reduce exports from the U.S. to the rest of the world in the coming months.” The authors further estimate that most corporations are now more in debt compared to the pre-coronavirus period.
The economic relief stimuli packages implemented by Congress have helped rescue the economy from complete collapse. However, the packages have not shielded all sectors of the economy from the effects of the pandemic. Low-income regions and communities living in poverty did not significantly benefit from the relief packages. Many small and medium-sized companies were also not spared from the impact of the coronavirus pandemic despite a reduction in some corporate taxes by the government. With the country facing a possible second and third wave of the pandemic, more stringent measures on business closure and go-slow economic activities further threaten economic growth. Ultimately, while the effects of the coronavirus pandemic are uncertain, the U.S economy has been adversely impacted, leading to massive job losses and huge debts.
References
Vinelli, A., & Weller, C. E. (2020). The economic impact of coronavirus in the U.S. and possible economic policy responses . Center for American Progress. https://www.americanprogress.org/issues/economy/news/2020/03/06/481394/economic-impact-coronavirus-united-states-possible-economic-policy-responses/
Walmsley, T., Rose, A., & Wei, D. (2020). The impacts of the coronavirus on the economy of the United States. SSRN Electronic Journal . https://doi.org/10.2139/ssrn.3678835
