How much did the COVID-19 pandemic cost?
The COVID-19 pandemic that began in late 2019 and continued throughout the two years before 2020 and 2021 has taken a toll on human health with over six and a half million deaths officially attributed the virus as of January 2023. However, among the many tragedies of the pandemic that resulted in the loss of lives, its impact on global economies are also far-reaching. Recognizing that the COVID-19 pandemic is incredibly expensive, financial analysts around the globe have assessed the myriad costs involved. These economic effects emanate from introduced public health measures that forced closure of businesses, the disruption of supply chains and labor markets, and the shifts in consumer behavior. Global financial gurus pose the bill to be huge.
In the United States alone, the estimated financial loss from COVID-19 may be at $16 trillion. Healthcare cost-savings come into play due to business closures costs, increased unemployment insurance claims, reduced productivity and educational sector payments, as well as direct expenses for testing, vaccination, and treatment. The Unemployment rate in the country peaked at 14.7% in the month April 2020 when lockdowns and social distancing protocols were applied everywhere. There were many businesses, especially restaurant and retail businesses in the industries which suffered most that have been forced to close their businesses forever.
Globally, the United Nations Development Programme found that economic losses are over $15 trillion, and may rise to over $35 trillion by 2025 according to an International Monetary Fund study. The low income countries were having to pay high relative costs. These development reduced the poverty level and the countries had to use more drastic austerity measures. Supply chain problems, travel restrictions (to some areas), lower tourism and shift in demand for commodities are some of the issues that led to economies' declines worldwide.
During the pandemic, many governments had to provide additional fiscal stimulus and relief packages to prevent a deep recession. In the United States, more than $5 trillion was spent to boost unemployment benefits, pass the Paycheck Protection Program for small business support, disperse economic impact payments, and reimburse the state and local governments that provided vaccines for distribution. Lowest interest rates served as a sort of somehow a summation period for the economy.
The emergence and distribution of vaccines in 2021 certainly boosted the economic outlook but there are high chances that the pandemic-driven costs will be claiming space for years to come through increased deficits and debt problems. The anguish and loss of lives both humans will go through will remain an unfathomable thing forever. Yet, the estimated economic burden is the $35 trillion when the future income drop is included in the calculation rate - meaning that the level of interruptions caused by the coronavirus pandemic is no less than extraordinary. The policymakers still face the problems involved in ensuring a smooth recovery from the recession to avoid having a reoccurrence of the same.