Coronavirus has had wide-ranging consequences. As the virus has spread worldwide, it has caused enormous economic disruption: every advanced economy is in a recession or depression, whilst all emerging economies (excluding China) are in recession. The economic impact of the pandemic began with panic buying, increased goods usage and disruptions to manufacturing and logistics. Stock markets across the globe saw their largest single-week declines since 2008 at the end of February 2020, followed by international stock market crashes in March.
Within the UK, household spending fell 41.2% in April 2020, compared with April 2019. 8.4 million employees in Britain were furloughed by the beginning of May 2020. Also in May, the Office for National Statistics announced a 2% fall in GDP (gross domestic product) for the first quarter of 2020, with an unprecedented 5.8% fall in March alone. In August 2020, it was announced that the UK had entered into a recession for the first time in over 10 years.
Potential future economic impacts of Coronavirus include: food and supply shortages, price raises and disruptions to financial markets. The full monetary impact of the pandemic is not yet known (and may never be accurately assessed), but it is likely to be in the billions and increasing.
Read on to find out how COVID-19 has affected global economies, labour markets, businesses, workers and financial institutions.
Podcasts
- Podcast: Coronavirus: The economic shockJoin the BBC’s Simon Jack as he interviews economic and business experts - from the UK and further afield - to find out the unique ways in which COVID-19 is impacting the global economy and what the economic landscape may look like following the pandemic.
- Podcast: How coronavirus almost brought down the global financial systemThis audio version of a longform article from the Guardian newspaper is a fascinating deep dive into world economic response during the early days of the pandemic. Take a break and listen to how global financial collapse was prevented by monetary authorities ‘flattening the curve of financial panic’ in March 2020.
- Pandemic Economics podcastThe pandemic has led to a severe recession. This briefing examines different aspects of the economic impact of the crisis to date and outlines the key issues for the economic outlook.
Resources
- North East economy predicted to suffer hardest hit from coronavirusArticle from Business Live website reporting on the potential damage to the local economy due to the coronavirus and slow recovery after the pandemic
- North East COVID-19 Economic Response:Report from The North East COVID-19 Response Group
- Parliamentary inquiry: The impact of coronavirus on businesses and workersA treasure trove of resources covering the effect of COVID-19 on the UK’s businesses and employees, with testimonies from the manufacturing, automotive and retail industries. This inquiry features a variety of informative and easy to follow material, including: oral and written evidence, video recordings and correspondence files.
- Coronavirus: a visual guide to the economic impactThe BBC have provided a helpful, colourful visual guide illustrating the impact of COVID-19 on the domestic and global economy. The charts and graphs cover a wide range of topics, including: unemployment, oil prices and consumer footfall in stores. The statistics and infographics are a great counterpoint to other sources that are more reliant on written evidence.
- Resolution Foundation: the economic impact of CoronavirusThe Resolution Foundation are an independent British think tank who aim to improve the standard of living for low and middle-income families. This report details the economic effects of COVID-19 in the UK until May 2020. It is highly detailed but easy to understand, featuring useful infographics and sections on employment, the labour market, trade and personal financial wellbeing.
- What does the COVID-19 crisis mean for the economies of British cities and large towns?The Centre for Cities, a non-profit urban policy research unit, looks at how Coronavirus has impacted all aspects of the economy, down to people’s living situations.
- Out of Work: The coronavirus shutdown through the eyes of the recently unemployedThis article from California Sunday magazine covers the impact of Coronavirus on workers across nine sectors of American society. Follow stories of sudden career changes, new side hustles and “embracing the lull” in the Golden State.
- COVID Conversations With One of America’s Richest Men“When you’ve been lucky, you just assume you’re always going to be lucky”. What kinds of problems, if any, does Coronavirus create for those at the very top? View the pandemic and its economic impact through the eyes of an anonymous Wall Street billionaire.
- Covid-19 second wave pushing UK to brink of double-dip recessionThe Guardian reports on concerns that the second wave will cause more strain to the already faultering economy.
- Revealed - the impact Eat Out to Help Out had on infection ratesNew research suggests strong links between the stimulus policy and a resurgence in cases.
- 18 people shared how the pandemic year changed their finances and it's eye-opening“I couldn't wrap my brain around the fact that I literally couldn't work. I felt like a failure.”
- Covid-19 and the UK’s BAME communities – an economic perspectiveNot everyone has been impacted by the coronavirus in the same way, and the type and severity of impacts are wide-ranging. Impacts can vary from health, to employment and personal finances. In a series of articles, Insight authors are examining the impact of Covid-19 on different demographic groups; the current article focuses on the economics of Covid-19 and the BAME population.
- How well-positioned is the UK economy to recover from COVID?Alex Chapman, a senior researcher at the New Economics Foundation in the U.K., shares his assessment of where he thinks the U.K. economy is likely to go over the next two years.