Fed: The COVID-19 pandemic affected the economy for decades
Business people will make future decisions with consideration and calculation about the possibility of another pandemic, the researchers said.
|Many businesses were closed due to COVID-19. (Image: Reuters)|
According to a study published at the annual conference of Federal Reserve US (Fed) in Kansas City is held last week, the global epidemic COVID-19 will reduce the risk as well as the negative impact. economic output for decades.
The above study by the branch Fed at St. The pandemic will only increase awareness about “one,” Louis performed shock extremely negative in the future “.
According to the above study, the COVID-19 pandemic will eventually pass, vaccines will be developed and workers will return to work. However, this major event can have lasting effects on the nature of economic activity.
Accordingly, the researchers said that the business world will make future decisions with consideration and calculation of the possibility of another pandemic occurring.
They will continue to be overly cautious about not only another outbreak but also possible unexpected disruptions to the economy.
Shocks that strike one area can affect another in the future in unforeseen ways, the study confirms.
The study highlights the fact that the pandemic will make certain types of assets, such as real estate and facilities, obsolete as their value declines rapidly in the future economy.
This can be seen at the present time when restaurants are closed or only use a small amount of space to receive diners. Many offices are now vacant due to the increasing number of employees working from home.
In addition, not many individuals will dare to take additional risks and start new businesses because they see so many defaults and bankruptcy now, while the COVID-19 pandemic will cause damage. longer than the oil crisis of the late 1970s, the recession of the early 1990s, and the Great Depression.
The economic losses mentioned include a significant drop in the US Gross Domestic Product this year that could be 10 times the expected drop from 6% to 9%.
Additionally, depending on the number of times the United States has to close, the pandemic impact is likely to reduce economic output for 70 years from 57% to 90% of annual GDP before the start of the pandemic.