The COVID-19 pandemic is having an unprecedented impact on societies around the world. As governments mandate social distancing practices and instruct non-essential businesses to close to slow the spread of the outbreak, there is significant uncertainty about the effect such measures will have on lives and livelihoods. While demand for specific sectors such as healthcare has skyrocketed in recent months, other sectors such as air transportation and tourism have seen demand for their services evaporate. At the same time, many sectors are experiencing issues on the supply-side, as governments curtail the activities of non-essential industries.
Which industries will suffer most from demand-side or supply-side shocks resulting from the pandemic? Which workers are most of risk of unemployment or reduced wage income? Who will be the winners and losers?
Professor Doyne Farmer and Maria del Rio-Chanona talk about their recent paper which estimated these shocks would threaten around 22% of the US economy's GDP, jeopardise 24% of jobs and reduce total wage income by 17% - while the potential impacts are a multiple of what was experienced during the global financial crisis, and perhaps comparable to the Great Depression. Aggressive fiscal and monetary policies are needed to minimise the impact of these shocks but the avoidance of endangering public health must be the priority.
This talk is in conjunction with The Smith School of Enterprise and the Environment at the University of Oxford and the Oxford Review of Economic Policy.