According to a recent survey done by economists, the US economy will face ups and downs in 2021. The impact of COVID-19 has flattened the growth of almost everything. People have lost jobs, and businesses have been closed due to lockdown. Well, most economists are of the opinion that almost 10% to 20% of people who lost their jobs will not get them back again. According to the median forecast, the growth of GDP will be lowered by 3.6%. Most people are asking whether the GDP will reach the pre-pandemic level or not. Economists hold different opinions. Some are of the opinion that it will take almost one year, whereas some are saying that the GDP will become stable by the end of the first half of 2022.
Impact of COVID-19 on the US Economy
The impact of COVID-19 on the US economy is highly disruptive. It hampers the growth of several aspects of the country such as shipping, employment, financial markets, travel, and many more. Well, the Congressional Budget Office, otherwise known as CBO, summarized the impact of COVID-19. We have highlighted some of the points below:
- If we talk about the unemployment rate, it has been increased by 3.5%.
- People working in various sectors such as health services, education, retail, hospitality, and many more lost their jobs. According to a survey, almost 10 to 16 million hospitality and leisure jobs were lost in April.
- Small business owners have faced critical situations. Due to lockdown, they were compelled to close their outlets. Moreover, people were following the lockdown rules; therefore, they were giving much preference to online transactions. As a result, the growth of small businesses was hampered.
According to the employment report published in February 2020, almost 1.28 million people lost their jobs permanently. The number became 3.41 million in August, and in September, it became 3.75 million. According to the report published by the Bureau of Labour Statistics, the unemployment rate is increased by 14.7 percent. Another report says that almost 25 million people could lose the health insurance provided by their employer if the unemployment rate touches 20%.
In short, COVID-19 has created an economic crisis as well as a health crisis in the United States. The pandemic has created financial shock, supply shock, and demand shock all at once. Consumers are also spending less; therefore, it hampered manufacturing as well as the mining industry.