Economic Downturn: Covid And The Us Economy

As COVID-19 continues its deadly assault across every state in the US, it leaves no industry or individual unaffected. Today, there are more than one million cases across the country and deaths in hundreds of thousands. Additionally, according to Forbes magazine, the US service sector saw a contraction for the first time in 11 years when its index fell to 42.8 from 52.5. Supply chains are not like before, unemployment rates are on the rise, and the health crisis is now a mainstay for everyone in the USA. 

Despite the US government doing its best to counter the effects of COVID-19, the pandemic is forcing various industries to downsize, reduce business operation hours, or completely shutting down shop. What used to be a booming economy compared to other countries of the world is now on its knees, begging for some respite. 

Such a downfall in the US economy never occurred in its entire history. And all industries are failing to recover from its aftermath. Today, in this article, we will share some facts and figures about the sectors that COVID-19 affected the most. Some of these facts and figures about these sectors and industries are listed as follows:

  • Increase In Unemployment Rate

The number of people unemployed across all states of the USA increased from 6.2 million to more than 16 million to 20.2 million one month after that.  As a result, the employment rate went down by 13 percent in May of 2020. Women experienced a higher rise in unemployment rates than men in the entire workforce in the USA.

Women account for the majority of the workforce in the education and hospitability sector. The employment rate in these two sectors decreased by 15 and 39 percent. When talking about employment rates based on racial aspects, Hispanic women had it the worst.  Compared with other women of different racial backgrounds, they experienced an employment rate of 19.5 percent in May 2020. According to news from the world, the employment rate is at an all-time low, and the economic depression continues to grow in every country.

  • Downsizing In Various Business Sectors
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Various companies in the USA announced that they need to lay off more than 1000 people due to the COVID-19 pandemic to stay above water. According to the US travel association, more than one million people, or 45 percent of the entire workforce in this industry, were eliminated or will be in the upcoming weeks. 

These actions show that the COVID-19 outbreak poses a threat to increase the unemployment rate, which was sitting at an all-time low of 3.5 percent before the pandemic occurred. Many of these layoffs are temporary, and statisticians expect things to be back to normal once the pandemic passes. 

  • Impacts On The Us Healthcare Sector

According to the American hospital association, the entire US healthcare sector suffered a loss of more than 202 billion dollars from 1st March to 30th June. It happened due to increased medical costs and a reduction in overall profits. 

However, it was not all doom and gloom in the healthcare sector. Due to the COVID-19 outbreak, there was an increase in the employment rate in this sector. The government opened many new hospitals in various states for the sole purpose of providing care for people who tested positive for COVID-19. Such an increase in healthcare facilities opened up new job opportunities for medical professionals everywhere. After all, it is medical professionals who are the most precious commodity nowadays. These individuals also saw a bump in their salaries. For example, if a medical professional earned 1000,000 per month, now he is getting anywhere from 200 to 300,000 dollars per month. 

In the medical equipment industry, there was s massive shortage of masks and gloves. And because of this, many alcoholic beverage providers started making hand sanitizers, which increased their profits. Numerous hand volunteers started using hand-sewing machines to create reusable non-medical masks. It was because of small businesses closing up shop, which led to alternative options being the number one choice of people everywhere. 

  • Some Businesses Have Completely Closed Up Shop
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Although some large multi-million dollar companies may stay afloat, small businesses don’t have the luxury or finances to do the same during the pandemic. According to research, small companies had it the worst. These businesses closed up shop till further notice only after three weeks of the COVID-19 pandemic. 

Small businesses reduced their working hours or completely closed down. According to research, the USA lost around 15 million active small businesses after the COVID-19 pandemic. Businesses operated by immigrants suffered a drop of 36 percent in their activities. And, female small business owners suffered a 25 percent drop. According to these figures, the losses are evident. Nobody was safe from the COVID-19 outbreak. 

  • Downfalls In The Restaurant Industry

According to the national restaurant association, the projected sales figure was 899 billion dollars. However, that did not happen because COVID-19 came and destroyed it all. The industry employed around 15 million people before the pandemic came. It represented ten percent of the entire work in the USA. 

However, after people started testing positive for COVID-19, the US government ordered to closed down bars and restaurants. Due to such a thing, the restaurant industry focuses more on delivery services. It is because of the restriction of having employees at their place of business. 

  • Fisheries Saw A Decline In Profits
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Due to the temporary lockdown and closure of various restaurants, the seafood industry saw a decline in profits. After all, around 80 percent of all seafood consumption takes place inside restaurants. Also, seafood export plummeted. Many seafood products are suffering from a decrease in market value. The individuals who capture these kinds of seafood are experiencing disruptions in the catching process.

Also, according to medical research, COVID-19 can spread through fish and other seafood products. Due to this, salmon production in the USA is down by 50 percent. However, canned and frozen products weathered the storm of the downturn. People are opting for canned seafood products than fresh ones these days. 

Conclusion

Whatever the economic downturns are, the COVID-19 pandemic is not going anywhere anytime soon. Governments have to come together and give their best efforts to fight the COVID-19 pandemic. Healthcare institutes are around the world are working day and night to come up with a cure for this virus, and according to recent reports, they are close to finding one. Until then, we have to stick together and survive the storm in hopes everything will be better again. 

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