The economic impact of the COVID-19 pandemic in the United States has been widely disruptive, adversely affecting travel, financial markets, employment, shipping, and other industries. The impacts can be attributed not just to government intervention to contain the virus (including at the Federal and State level), but also to consumer and business behavior to reduce exposure to and spread of the virus.
Real GDP contracted in 2020 by 3.5%, the first contraction since the 2008 financial crisis. Millions of workers were dislocated from their jobs, leading to multiple weeks of record shattering numbers of unemployment insurance applications. Consumer and retail activity contracted, with many businesses (especially restaurants) closing. Many businesses and offices transitioned to remote work to avoid the spread of COVID-19 at the office. Congress passed several pieces of legislation, such as the American Rescue Plan Act of 2021 to provide stimulus to mitigate the effect of workplace closures and income losses. The Federal Reserve reduced the federal funds rate target to nearly zero and introduced several liquidity facilities to keep financial markets functioning and to provide stimulus. In late 2021, inflation began to increase to levels not seen since the 1980s.
Recovery from the recession began relatively quickly, with the recession only lasting one quarter according to the NBER. As of 2022, the unemployment rate reached its pre-pandemic levels - nevertheless, in many key aspects and industries, the U.S. economy has not completely recovered from the COVID-19 pandemic.
A growing digital gap emerged in the United States following the pandemic, despite non-digital enterprises being more dynamic than in the European Union. In the United States, 48% of enterprises that were non-digital before to the pandemic began investing in digital technologies. 64% of firms that had previously implemented advanced digital technology also increased their investment in digitalisation.[2][3] In the United States, 20% of jobs were found within firms that have not digitally transformed. According to a recent survey, these are called "sleepwalking firms", and are also more likely to pay lower wages and to create lower employment. These firms were also less likely to train their employees throughout the COVID-19 outbreak.[4][5]
Overview
In 2020, the U.S. GDP contracted at a 3.5% annualized rate. It was the biggest contraction since 1946 and the first contraction since 2009.[6][7]
The United States Census Bureau's Household Pulse Survey published weekly statistics of the effects of the pandemic on Americans' lives. For week 12 (July 16–21), 51.1% of respondents reported a loss of employment income since March 13, 2020, 12.1% reported food scarcity, 40.1% delayed getting medical care in the past four weeks, and 26.5% reported housing insecurity.[8]
Statistical summary
The following table illustrates the impact of the pandemic on key economic measures. February 2020 represented the pre-crisis level for most variables, with the S&P 500 stock market index (a leading indicator) falling from its February 19 peak. From February through June, the number of persons with jobs was down 14.6million. The U.S. also added $3.1trillion to the public debt in just 4 months.
In the February 2020 jobs report, which reflected the employment situation before lockdowns began, 1.28million Americans were classed as "permanent job losers". In August, that number was at 3.41million, and in September it rose to 3.75million. "Temporary layoffs", meanwhile, decreased, suggesting that some job losses originally understood as "temporary" had now become permanent.[17]
On May 8, 2020, the Bureau of Labor Statistics reported that 20.5million nonfarm jobs were lost and the unemployment rate rose to 14.7 percent in April.[18] This followed reports of weekly initial claims for unemployment insurance that increased from a typical level of around 200,000 per week through early March, to 3.3million the week of March 21, a peak of 6.9million (March 28), and declines each week thereafter to 3.0million the week of May 9. A total of 36.5million filed for unemployment insurance from March 21 to May 9.[19] The Congressional Budget Office estimated that costs for unemployment insurance claims were $49billion in April 2020, versus $3billion in April 2019. An estimated $27billion of the increase was due to the $600/week increase in unemployment benefits due to the CARES Act.[20]
On May 20, 2021, the Labor Department reported that there had been only 444,000 unemployment claims during the previous week, the lowest number since the beginning of the pandemic.[21]
The United States depended on direct payments and loans to help individuals and businesses, regardless of whether jobs were retained. As a result, while aggregate hours worked decreased by around 15% in the United States and the European Union, unemployment increased significantly in the United States. However, in the United States, most firms that implemented digital technology were better able to avert worker reductions than non-digital firms.[22][23][24][25]
Surveys and studies
In a paper published in early May 2020, the Urban Institute estimated that about 25 million people would lose their employer-provided health insurance if the unemployment rate were to rise to 20%. Of these, they speculated, 12million would obtain Medicaid coverage, 6million would find coverage privately, and 7million would become uninsured.[26]
By summer 2020, nearly two-thirds of households where an adult had contracted COVID-19 had also experienced job loss or a reduction in hours. Likewise, "serious financial problems" were reported by nearly two-thirds of those households, whereas such problems were reported by just under half of U.S. households overall, according to a survey by NPR, the Robert Wood Johnson Foundation, and the T.H. Chan School of Public Health at Harvard University that was conducted in July and August.[27]
The impact of COVID-19 on employment varied widely across industries. For example, a study found that transportation workers were 20.6% more likely to be unemployed compared to those in other sectors, with specific sub-sectors like taxi drivers facing particularly severe job losses.[28]
The economic impact and mass unemployment caused by the COVID-19 pandemic raised fears of a mass eviction crisis, with an analysis by the Aspen Institute indicating between 19 and 23 million, or 1 in 5 renters, were at risk for eviction by the end of September 2020.[29] A separate July 2021 United States Census Bureau survey projects 7million households unable to pay rent and at risk of eviction, with a potential 3million eviction filings in the next two months.[30]
The federal CARES Act provided for a 120-day moratorium on evictions for federally backed properties, beginning on March 27 when the act was signed, and lasting til July 24[31][32] on eviction filings for rental units in properties that participate in federal assistance programs, or have a federally backed mortgage or multifamily mortgage loan.[33] According to one estimate, this eviction moratorium covered 28% of all rental units in the United States;[34] however, there were no enforcement mechanisms provided.[35] A number of cities and states also passed rulings suspending evictions for varying amounts of time.[36] When these moratoria ended in June and July 2020, evictions increased in many states and jurisdictions.[37] A new nationwide moratorium was announced by the Centers for Disease Control began on September 1 which banned evictions for most renters for the rest of 2020.[38][39]
The CARES Act also provided protection from foreclosure until August 31, 2020, for homeowners with federally backed mortgages.[40] The CARES Act also allows mortgage holders the right to a mortgage forbearance for up to 180 days, with another 180 days on request.[41][42] Several states also passed foreclosure moratoriums as well.[43]
The United States Census Bureau uses their Household Pulse Survey[44] to gather data on both monthly rent and mortgage payments during the pandemic. For the week of July 16–21, 2020, 8,251,079 homeowners of owner-occupied housing units did not make their mortgage payment on time and 4,473,321 deferred their payments, out of 148,685,473 surveyed.[45] Similarly, 13,339,515 renters did not pay last month's rent, and 1,504,864 deferred their rent, out of 73,065,587 responses.[46]
Homelessness had already been rising before the pandemic, with a 2% increase in the number of homeless people between January 2019 and January 2020.[47]
Home sales
People who could afford to buy homes enjoyed the lowest mortgage interest rates since at least 1971.[48] Home sales rose and showed a trend of people who could work from home moving out of expensive, large cities into smaller, lower-cost cities where they could afford larger homes with more on-site amenities.[49] States like California and New York saw an exodus as a result of the pandemic.[50] Housing prices rose amid a building boom as lumber futures reached an all-time high.[51][52]
Food insecurity
Food insecurity across the United States rose significantly in 2020.[53] Feeding America predicts that an additional 17 million people could become food insecure because of the pandemic, bringing the total to more than 54million people in the country.[citation needed]
Before COVID-19, food insecurity was still prevalent, impacting 37million people in the U.S. Since food insecurity and poor nutrition are "associated with chronic diseases that put people at higher risk for the more severe complications of COVID-19, the food access crisis has exacerbated the already glaring disparities in health outcomes for vulnerable people, including low-income people, children, older adults, and [undocumented immigrants living in the United States]."[54] While the factors underlying racial and ethnic disparities are complex and multidimensional, disparities in food security have played a crucial role in the health inequities that have been witnessed during the pandemic. The ability to eat healthy, nutritious food depends on an individual's circumstances and environment.[54][55]
The pandemic left millions of people in the U.S. at-risk when it comes to nutrition and overall health status. The pandemic complicated food insecurity among children, older adults, and undocumented immigrants. Feeding America stated that the estimated number of food-insecure kids could jump from 11 million to an estimated 18million. Additionally, many children in the U.S. rely on free meals for sustenance. While food banks and pantries amped up services, the temporary disruption in these services could have devastating long-term consequences. Many seniors live on low and fixed incomes, resulting in decreased access to adequate nutrition and support services. Seniors are also particularly vulnerable to the devastating effects of COVID-19, leading many to avoid unnecessary visits to food pantries and health clinics. Undocumented immigrants are arguably the most vulnerable to food insecurity because they are ineligible for many government assistance programs. Even before the pandemic, 1 in 4 experienced food insecurity.[56]
Food pantries encountered record numbers of clients, with many across the country serving 55 percent more people now than before the pandemic, according to Feeding America. The pandemic further stretched existing community resources, and it demonstrated the need for additional funding geared towards addressing the largest contributing factors of health – the social determinants of health.[57]
March 3: Federal Reserve chairman Jerome Powell announces a 50 basis point (0.5% percentage point) interest rate cut in light of "evolving risks to economic activity."
On February 27, 2020, the Dow Jones Industrial Average (DJIA) dropped 1,191 points, the largest single-day point drop in the index's history at the time; some attributed the drop to anxiety about the epidemic.[58] The same day, the S&P 500 logged a 4.4% decline.[59] The record was beaten five more times during the outbreak on March9 (2,013), March 11 (1,465), March 12 (2,353), and finally set the current record for most points lost in a single day by losing 2,997 points on March 16. It once again fell another 1,338 points on March 18. On March 13, the stock market rebounded for the single largest one-day point gain in the market's history by gaining 1,985 points after Trump declared a state of national emergency to free up resources to combat the virus.[60][61] The six business days it took for the S&P 500 Index to drop 10% (from February 20 to 27) "marked the quickest 10% decline from an all-time high in the index's history."[59] From January 21 to March 1, the DJIA dropped more than 3,500 points, equating to roughly a 13% decrease.[62][63]
Stock index futures declined sharply during Trump's March 11 address,[64] and the Dow Jones declined 10% the following day—the largest daily decline since Black Monday in 1987—despite the Federal Reserve also announcing it would inject $1.5trillion into money markets.[65] By March 18, investors were shunning even assets considered safe havens during economic crises, such as government bonds and gold, moving into cash positions.[66] By March 20, the Dow Jones was below the level when President Trump was inaugurated on January 20, 2017, having fallen 35% from its February peak.[67] The markets rallied between March 23 and 26, with the Dow having its best three-day gain since 1931. On March 27, the Dow fell 3.5% and the S&P 500 fell 3.2%. The NASDAQ Index also fell. Boeing fell 10%, while Exxon and Disney each fell 6%.[68]
In February 2020, the American companies Apple Inc. and Microsoft began lowering expectations for revenue because of supply chain disruptions in China caused by the virus.[69] In a February 27 note to clients, Goldman Sachs said it expects no earnings growth for U.S. companies in 2020 as a result of the virus, at a time when the consensus forecast of Wall Street expected "earnings to climb 7%."[70] On March 20, 2020, as part of an SEC filing, AT&T cancelled all stock buyback plans included a plan to repurchase stock worth $4billion during the second quarter. The reasons AT&T gave for the cancellation was to invest the money into its networks and in taking care of its employees during the pandemic.[71]
In response to the economic damage caused by the pandemic, some economists have advocated for financial support from the government for individual Americans and for banks and businesses.[72][73] Financial analyst Karen Petrou objected to government intervention on the grounds that it would alter the role of the Federal Reserve and enshrine moral hazard as a defining market principle.[74]
Several officials faced allegations of insider trading, citing sales of their stock portfolios that coincided with private briefings and other statements regarding COVID-19, and almost immediately preceding a major stock market crash on February 20. Senate Intelligence Committee chairman Richard Burr sold up to $1.7million of stocks while making public statements of reassurances of the government's level of COVID-19 preparedness. Georgia senator Kelly Loeffler sold tens of millions of dollars worth of stocks after a closed briefing on the COVID-19.[75] Senator Dianne Feinstein, a member of the Senate intelligence committee, sold between $1.5m and $6m in stock of Allogene Therapeutics, a biotechnology company. U.S. Representative Nancy Pelosi's husband purchased $3.3million worth of technology stocks expected to surge during a lockdown.[76] On May 14, after having had a warrant served against him by the FBI, Burr announced that he would step down from his position during the investigation.[77]
In 2021, 79% of US firms stated that the COVID-19 pandemic will have a long-term influence on requirements and priorities in investment.[78][79]
The supply of coins in the U.S. banking system was lowered to the point of rationing, due to many stores being closed, many coin-counting machines being unavailable, and fewer coins produced by the U.S. mint to protect employees.[80][81]
However, as the economy recovered from COVID-19, some such as J.P. Morgan Chase strategist Marko Kolanovic expected the U.S. stock market surge that happened since the trough to continue into 2021.[82]
The U.S. oil, gas and chemicals industry lost 107,000 jobs between March and August 2020, according to Deloitte. When demand for jet fuel, diesel and gasoline suddenly dropped, oil was in oversupply.[83]
In response to shortages, some alcoholic beverage facilities started manufacturing and distributing alcohol-based hand sanitizer.[84]General Motors opened its manufacturing, logistics, and purchasing infrastructure for use by Ventec, a Washington State manufacturer of medical ventilators.[85] As medical mask manufacturers hired hundreds of new workers and increased output,[86] in response to urgent requests from hospital workers, volunteers with home sewing machines started producing thousands of non-medical masks which can be sterilized and re-used. Fabric was bought privately or donated by Joann Fabrics.[87] The CDC recommended the use of homemade masks (preferably in combination with a full-face splash shield) only as a "last resort" when no other respiratory protective technologies were available, including reused professional masks.[88]Bauer Hockey began manufacturing face shields for medical applications on March 26.[89]
Some U.S. officials and commentators criticized the outsourcing of critical materials—like the production of essential medical supplies—to China.[90][91]
International aid
Chinese billionaire Jack Ma donated COVID-19 test kits and face masks to the United States.[92] The Russian government sent a cargo plane with ventilators and face masks.[93]
Surge in medical personnel
Several states and non-profit groups started recruiting retired medical personnel to increase staffing in hospitals and at temporary facilities.[94][95] Some jurisdictions granted emergency medical licenses to inactive doctors, and incoming resident doctors and interns, and expanded the tasks that nurses were allowed to do.[96]
Telemedicine
The COVID-19 pandemic led to a sharp increase in the use of telemedical services in the United States, specifically for COVID-19 screening and triage.[97][98]As of March29,2020[update], three companies offered free telemedical screenings for COVID-19 in the United States: K Health (routed through an AI chatbot), Ro (routed through an AI chatbot), and GoodRx (offered through its HeyDoctor platform).[99][98][100]
May 8, 2020: Distribution of frozen chicken to those in need in Baltimore, Maryland
Meatpacking plants experienced sporadic shutdowns as many workers contracted COVID-19, resulting in spot meat shortages around the country.[citation needed]
According to the Centers for Disease Control and Prevention issued a report stating that by April 27, out of 130,578 workers nationwide, at least 4,913 meat and poultry plant workers had COVID-19. Cases were reported in 115 plants located in 19 states, and at least 20 people had died.[101][102][103] At least 2 USDA meat inspectors died of COVID-19,[104] 137 tested positive, and 704 others refused to work due to lack of protective equipment in a high-risk environment.[105]
As of April 22, 2020, about 25% of the pork processing capacity of the nation had been cut.[106] Beginning in late March 2020, weekly beef production was down 19% year-over-year.[107] As the fastest-growing mass-market meat animal in the United States, chickens were the most vulnerable to farms running out of capacity to hold an excess population. At least two million chickens were euthanized on farms in Delaware and Maryland rather than slaughtered for meat, due to lack of capacity to process them for human consumption.[108]
By May 5, around 18% of Wendy's restaurants (concentrated in certain geographic areas of the country) were unable to serve beef sandwiches, but still had chicken available.[109] Wendy's uses fresh beef; in contrast, McDonald's, which uses frozen beef, was unaffected.[109] Supermarket and big box chains Kroger, Wegmans, Costco, Whole Foods, ShopRite, Sam's Club, Stop and Shop, Price Chopper Supermarkets, and others started limiting the amount of meat purchased per customer.[110][111][112][113] Hundreds of millions of pounds of beef and pork remain in cold storage, originally intended for restaurants; the USDA started allowing this meat to be sold at grocery stores, though it must be cut down by store workers into consumer-sized packages.[114]
May 11, 2020: sign for curbside restaurant service only in Brunswick, Georgia
The U.S. restaurant industry was projected to have $899billion in sales for 2020 by the National Restaurant Association, the main trade association for the industry in the United States.[115] The industry as a whole as of February 2020 employed more than 15 million people, representing 10 percent of the workforce directly.[115] It indirectly employed close to another ten percent when dependent businesses such as food producers, trucking, and delivery services were factored in.[115]
On March 15, Ohio Governor Mike DeWine and Ohio Health Department director Amy Acton ordered the closure of all bars and restaurants, saying the government "encouraged restaurants to offer carryout or delivery service, but they would not be allowed to have people congregating in the businesses."[116] The next day, Illinois, New York, New Jersey, and Maryland followed suit.[117]
Groups of restaurateurs in New York City and Cincinnati called on governments to provide help to the nation's small and independent restaurants.[118][115] On March 19 the New York group called for state governments to issue orders for rent abatements, suspension of sales and payroll taxes, and a full shutdown so business interruption insurance coverage would be triggered.[119] On March 20 the Cincinnati group called on the federal government to provide a $225billion bailout to the restaurant industry.[115]
Several restaurant chains altered their operating procedures to prevent the spread of the virus, including removing seating, restricting the use of condiments, and switching to mobile payment systems. Many restaurants opted to close their dining rooms and instead switch to solely take-out food service to comply with physical distancing recommendations.[120]
According to the National Restaurant Association, 60% of restaurant owners did not think the relief programs would be enough to keep employees on payroll. Restaurants reported $30billion in losses in March.[121]
Office workers
By 2022, even though it was possible to bring employees back full-time, the necessity of working from home during the pandemic proved to many employers that it was feasible, and many office workers preferred to continue working from home several days a week. Most chose to extend weekends and work from home Monday and Friday. This leaves Tuesday, Wednesday, and Thursday as high-traffic days in downtown office districts, and negatively impacting patronage at businesses that serve office workers, such as lunch restaurants.[122] More businesses began providing free food at offices in order to entice workers to return in person.[123] Some companies reconfigured their office spaces to avoid paying for unused desk space. This included leasing out empty space to other companies, and allocating more space to hot desks.[124]
Retail
March 18: Best Buy lets only a limited number of people into their Union Square store in New York City.
A number of retailers, particularly grocery stores, reduced their opening hours to allow additional time to restock and deep-clean their stores.[125] Major stores such as Walmart, Apple, Nike, Albertson's, and Trader Joe's also shortened their hours.[125][126] Some grocery store chains, including Meijer,[127]Stop & Shop and Dollar General, devoted a portion of their operating hours to serve only senior citizens.[128][129] Many grocery stores and pharmacies began installing plexiglass sneeze guards at register areas to protect cashiers and pharmacists, and adding markers six feet apart at checkout lines to encourage customers to maintain physical distance.[130] To prevent hoarding, many supermarkets and retailers placed limits on certain products such as toilet paper, hand sanitizer, over-the-counter medication, and cleaning supplies.[131] However, the Food Marketing Institute announced that its supply chain was not strained and all products would be available in the future.[131] Major retail chains started hiring tens of thousands of employees to keep up with demand, including Walmart (150,000), CVS Pharmacy (50,000), Dollar General (50,000), and 7-Eleven (20,000).[132]Sheetz convenience stores began offering free meals to children in need at select stores in Maryland, North Carolina, Ohio, Pennsylvania and West Virginia.[133] A daily senior shopping hour, checkout line distancing markers, hand washing and sanitizer for employees, disinfecting wipes for customers to use on carts, and a ban on reusable bags became mandatory in Massachusetts on March 25.[134] Many stores began limiting the number of people inside at a time, to increase the typical distance between customers, resulting in outdoor lines with people spaced six feet apart.[135]
Retail sales fell 8.3% in March and 16.4% in April, according to the Commerce Department.[136] The hardest-hit sectors included home furnishings (down by two-thirds over these two months) and clothing (down 89% over these two months).[137]
Milk delivery services experienced demand which significantly exceeded pre-existing capacity.[138]
On June 19, 2020, about a month after starting to reopen their outlets in the US, Apple temporarily closed 11 retail stores across Arizona, Florida, North Carolina, and South Carolina due to rising numbers of COVID-19 cases.[139]
In July 2020, the largest supermarket chain in the country, Kroger, stopped giving coins as change. Because the U.S. Mint had decreased coin production to protect its employees during the pandemic, and because banks were giving fewer coins to the Federal Reserve, Kroger had difficulty obtaining enough coins for its business. (Instead, Kroger offered to make charitable donations or to issue store credit to the customer.)[140]
On June 13, 2021, the Washington Prime Group, an owner of over 100 U.S. shopping malls, filed for bankruptcy.[141]
Seafood industry
The COVID-19 pandemic affected fishing and seafood industries worldwide beginning with the temporary lockdown and closing of all but essential businesses. This affected restaurants, which are where 80% of fish and seafood consumption takes place in the U.S.[142] Disruption to seafood exports resulted in cancelled orders to both national and overseas purchases.[143] Many fisheries became unprofitable and seafood export and import outlets were shuttered, with fishing crews and seafood processing workers being driven into finding other work as market dries up.[144]
President Trump also issued an executive order proposing U.S. farm-raised fish and shellfish as the new suitable form of seafood consumption in the United States. The executive order was meant to "encourage public-private partnerships and promote inter-agency, intergovernmental, and international cooperation in order to improve global maritime domain awareness… and economic growth,"[145] as well as strengthening national export and decreasing foreign competition.[146]
The pandemic impacted seafood supply chains on every level, from fisherfolk and coastal communities to large scale processors, distributors, foodservice buyers, and consumers.[147][pageneeded][148] Many seafood commodities suffered from unprecedented drops in market value and the communities that capture and produce these commodities were significantly disrupted.[147][pageneeded][149] A variety of policy approaches balancing public and economic health were implemented in response. On May 7, 2020, the US Secretary of Commerce announced an amendment to Sec. 12005 of the COVID-19 Aid, Relief, and Economic Security Act allocating $300million in financial assistance to COVID-19 affected coastal and fishery communities.[150] On the same day, President Trump enacted the Executive Order on Promoting American Seafood Competitiveness and Economic Growth. The order aims to increase the competitiveness of the American seafood industry via deregulation. Under the order, all eight Regional Fishery Management Councils must provide policy recommendations to "reduce burdens on domestic fishing" and initiate these recommendations by May 7, 2021.[151]
Shipping and mail
With consumers increasingly relying on online retailers, Amazon planned to hire another 100,000 warehouse and delivery workers and raise wages $2 per hour through April 2020. They also reported shortages of certain household staples.[152] At its warehouses, Amazon stopped exit screenings, as well as group meetings at the beginning of shifts, and staggered shift times and break times. The company also announced it would provide up to two weeks of pay to all employees diagnosed with COVID-19 or placed into quarantine, but presumably not for employees who merely had symptoms of fever and cough.[153] Amazon workers complained paid medical leave was difficult to obtain because of limited access to COVID-19 testing, and some petitioned the company to extend paid leave to elderly and medically vulnerable workers without a positive test.[154] As small numbers of workers tested positive for COVID-19, various Amazon warehouses closed for sanitization, including one in Kentucky for several days.[154] Amazon workers at the Staten Island warehouse and some Instacart workers nationwide separately announced strikes for March 30, demanding access to PPE, better sick pay, hazard pay for Instacart orders, and a longer closure of the Staten Island warehouse for cleaning.[155] From March 1 to September 19, 2020, nearly 20,000 of Amazon's U.S. employees tested positive or were presumed positive.[156]
The Chicago Tribune reported in March 2020 that employees at UPS, FedEx, and XPO, Inc. were often pressured not to take time off, even with symptoms such as fever and cough consistent with COVID-19. Public health authorities stated the risk was relatively low to customers receiving packages, in part because COVID-19 does not live for very long on cardboard, but infection most certainly was a danger for employees working beside crowded conveyor belts.[157]
UPS and FedEx suspended all delivery time guarantees but continued domestic pickups and deliveries. Some international private package deliveries were delayed, while others were completely suspended due to government shutdowns in other countries.[158]
Domestic package delivery continued, with two- and three-day package delivery guarantees extended by one day, due to lack of affordable domestic cargo transportation (presumably due to cancellation of most passenger airline flights).[159] A large amount of mail was held due to sustained business shutdowns, with the USPS extending the time period before returning to sender.[160] The USPS stopped accepting international mail for many countries, either due to suspension of service in the destination country or lack of affordable transportation.[161] Some military and diplomatic mail destinations were also shut down.[161] Some mail destined for Europe was diverted from air to sea transport, with a small number of containers sent by ships departing from the JFK International Service Center in New York for Rotterdam on April 20[162] and April 27,[163] 2020.
Some postal workers complained of lack of social distancing at work and outages of supplies, including masks, gloves, and rubber bands.[164]
In response to the workplace hazards associated with handling and delivering returned packages, some companies instituted policies meant to minimize risk to both workers and customers. Examples include extending the amount of time allotted to customers to return an item,[165] allowing customers to return an item to a physical location even if they purchased it online,[166] and quarantining returned packages for at least one day upon arrival in the warehouse.
Financial impact on the U.S. Postal Service
Ultimately, the pandemic contributed to an increase in e-commerce. By mid-April 2020, with many businesses dropping advertising campaigns or closing completely, the United States Postal Service (USPS) experienced a 30% drop in volume[167] and projected a $13billion loss in revenue[168] for 2020. The service was reluctant to accept a $10 billion loan allocated by the CARES Act because it would increase already high debt levels and give too much control to the U.S. Treasury, possibly advancing the Trump administration's plan to privatize the postal service.[169] It requested $89billion in grant aid from Congress.[167] The initially projected 2020 losses did not occur. In the fiscal year 2020, compared to the previous year, the amount of mail sent by the USPS grew 18.8 percent and operating revenue increased nearly $2 billion.[170]
Travel industry
Delta Air Lines planes parked on a taxiway at Kansas City International Airport. The planes are parked due to the sharp decrease in demand for air travel.March 4: President Trump and Airline CEOs discuss COVID-19's impact on the travel industry.Demand for motor gasoline fell sharply.
In mid-March, most major American and foreign airlines began cutting back on domestic and international flights as a result of the sudden drop in travel demand from the pandemic and subsequent travel bans, phasing out some routes entirely.[171][172] Cruise lines suspended all departures from the United States on March 14.[173]
On March 14, Amtrak reduced its service between Washington and Boston as the COVID-19 outbreak drastically decreased travel demand. It faced steep revenue losses during the crisis. It also asked noncritical employees "to take time off on an unpaid basis."[175] By the following week, New York's subways, usually the nation's busiest, were running mostly empty, which had the Metropolitan Transportation Authority using $1billion from its line of credit to stay afloat.[176]
The lobbying group for the airline industry, Airlines for America (A4A), on March 16 called for a $50billion subsidy, including $4billion for cargo services.[177]CNBC reported that airlines were preparing for a ban on domestic flights after President Trump said on March 14 he was considering travel curbs and acting DHS Secretary Chad Wolf said all options remained on the table when asked about a possible ban, the first since the September 11 attacks in 2001. United Airlines said they expected a drop of $1.5billion in March revenue, American Airlines said they expected to decrease domestic capacity by 20% in April and 30% in May, and Delta Air Lines told employees it would cut capacity by 40%.[178]
Transport and transport safety
Covid has had many effects on transport: reduction of traffic, increase of speed, increase of extreme speeding, increase in commercial shipping activity, increase dependence as a commercial vehicle society, increase working hours for truckers, and increase death rates per motor vehicle accident in the United States.[179] The freight industry experienced a shortage of truck drivers,[180] and freight rates rose higher than 2019 levels.[181] Supply problems and sudden demand for socially-distanced recreation and alternatives to public transport caused a shortage of bicycles.[182]
The pandemic reduced the value of office properties in New York City by as much as $28 billion.[183]
Impact on federal budget deficit and debt
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Due to the COVID-19 pandemic, Congress and President Trump enacted the $2.2trillion Coronavirus Aid, Relief, and Economic Security Act (CARES) on March 18, 2020. The Congressional Budget Office estimated that the budget deficit for fiscal year 2020 would increase to $3.3trillion or 16% GDP, more than triple that of 2019 and the largest deficit since 1945 (measured as percentage of GDP). CBO also forecast the debt held by the public would rise to 98% GDP in 2020, compared with 79% in 2019 and 35% in 2007 before the Great Recession.[184]
Additional proposals for large stimulus packages in late 2020 were stalled.[185] In December 2020, the Groundwork Collaborative think tank said a $3–4.5trillion stimulus package would be needed to return the economy to pre-pandemic levels.[186]
On July 1, 2021, the Congressional Budget Office said the federal deficit would reach $3 trillion for the second year in a row.[187] The national debt of the United States as of January 2022 reached $30 trilion.[188] Gross Domestic Product grew by between 5% and 6% in year 2021 and between 4% and 5% in the start of year 2022.[189]
Corporate bankruptcies
The following list is a selection of American companies that filed for bankruptcy during the pandemic.
Owner of New York Sports Club, Boston Sports Clubs, Philadelphia Sports Clubs, Washington Sports Clubs, Lucille Roberts, TMPL Gym and Total Woman Gym and Spa.
Filing was before the pandemic, which resulted in company opting to liquidate.
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DoorDash, Inc. is an American company operating online food ordering and food delivery. It trades under the symbol DASH. With a 56% market share, DoorDash is the largest food delivery platform in the United States. It also has a 60% market share in the convenience delivery category. As of December 31, 2020, the platform was used by 450,000 merchants, 20,000,000 consumers, and one million delivery couriers.
On December 31, 2019, China announced the discovery of a cluster of pneumonia cases in Wuhan. The first American case was reported on January 20, and Health and Human Services Secretary Alex Azar declared a public health emergency on January 31. Restrictions were placed on flights arriving from China, but the initial U.S. response to the pandemic was otherwise slow in terms of preparing the healthcare system, stopping other travel, and testing. The first known American deaths occurred in February and in late February President Donald Trump proposed allocating $2.5 billion to fight the outbreak. Instead, Congress approved $8.3 billion with only Senator Rand Paul and two House representatives voting against, and Trump signed the bill, the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, on March 6. Trump declared a national emergency on March 13. The government also purchased large quantities of medical equipment, invoking the Defense Production Act of 1950 to assist. By mid-April, disaster declarations were made by all states and territories as they all had increasing cases. A second wave of infections began in June, following relaxed restrictions in several states, leading to daily cases surpassing 60,000. By mid-October, a third surge of cases began; there were over 200,000 new daily cases during parts of December 2020 and January 2021.
Economic turmoil associated with the COVID-19 pandemic has had wide-ranging and severe impacts upon financial markets, including stock, bond, and commodity markets. Major events included a described Russia–Saudi Arabia oil price war, which after failing to reach an OPEC+ agreement resulted in a collapse of crude oil prices and a stock market crash in March 2020. The effects upon markets are part of the COVID-19 recession and are among the many economic impacts of the pandemic.
The COVID-19 pandemic reached the U.S. state of Mississippi in March 2020.
The Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act, is a $2.2trillion economic stimulus bill passed by the 116th U.S. Congress and signed into law by President Donald Trump on March 27, 2020, in response to the economic fallout of the COVID-19 pandemic in the United States. The spending primarily includes $300billion in one-time cash payments to individual people who submit a tax return in America, $260billion in increased unemployment benefits, the creation of the Paycheck Protection Program that provides forgivable loans to small businesses with an initial $350billion in funding, $500billion in loans for corporations, and $339.8 billion to state and local governments.
The COVID-19 pandemic affects the global food industry as governments close down restaurants and bars to slow the spread of the virus. Across the world, restaurants' daily traffic dropped precipitously compared to the same period in 2019. Closures of restaurants caused a ripple effect among related industries such as food production, liquor, wine, and beer production, food and beverage shipping, fishing, and farming.
The COVID-19 pandemic impacted the United States restaurant industry via government closures, resulting in layoffs of workers and loss of income for restaurants and owners and threatening the survival of independent restaurants as a category. Within a week after the first closures, industry groups representing independent restaurateurs were asking for immediate relief measures from local, state, and federal governments, saying that as many as 75 percent of independent restaurants could not survive closures of more than a few weeks. By late July, nearly 16,000 restaurants had permanently closed.
The COVID-19 recession was a global economic recession caused by COVID-19 lockdowns. The recession began in most countries in February 2020. After a year of global economic slowdown that saw stagnation of economic growth and consumer activity, the COVID-19 lockdowns and other precautions taken in early 2020 drove the global economy into crisis. Within seven months, every advanced economy had fallen to recession.
Strikes occurred during the COVID-19 pandemic due to many factors including: hazard pay or low pay, unsafe working conditions, inability to pay rent. These strikes are separate from the various protests that occurred over responses to the pandemic.
The COVID-19 pandemic has impacted the tourism industry due to the resulting travel restrictions as well as slump in demand among travelers. The tourism industry has been massively affected by the spread of coronavirus, as many countries have introduced travel restrictions in an attempt to contain its spread. The United Nations World Tourism Organization estimated that global international tourist arrivals could have decreased by 58% to 78% in 2020, leading to a potential loss of US $0.9–1.2 trillion in international tourism receipts.
The COVID-19 pandemic caused far-reaching economic consequences including the COVID-19 recession, the second largest global recession in recent history, decreased business in the services sector during the COVID-19 lockdowns, the 2020 stock market crash, the impact of COVID-19 on financial markets, the 2021–2023 global supply chain crisis, the 2021–2023 inflation surge, shortages related to the COVID-19 pandemic including the 2020–present global chip shortage, panic buying, and price gouging. The pandemic led to governments providing an unprecedented amount of stimulus, and was also a factor in the 2021–2022 global energy crisis and 2022–2023 food crises.
The federal government of the United States initially responded to the COVID-19 pandemic in the country with various declarations of emergency, some of which led to travel and entry restrictions and the formation of the White House Coronavirus Task Force. As the pandemic progressed in the U.S. and globally, the U.S. government began issuing recommendations regarding the response by state and local governments, as well as social distancing measures and workplace hazard controls. State governments played a primary role in adopting policies to address the pandemic. Following the closure of most businesses throughout a number of U.S. states, President Donald Trump announced the mobilization of the National Guard in the most affected areas.
The COVID-19 pandemic has taken a sharp economic toll on the retail industry worldwide as many retailers and shopping centers were forced to shut down for months due to mandated stay-at-home orders. As a result of these closures, online retailers received a major boost in sales as customers looked for alternative ways to shop and the effects of the retail apocalypse were exacerbated. A number of notable retailers filed for bankruptcy including Ascena Retail Group, Debenhams, Arcadia Group, Brooks Brothers, GNC, J. C. Penney, Lord & Taylor and Neiman Marcus.
The COVID-19 pandemic in the United States has had far-reaching consequences in the country that go beyond the spread of the disease itself and efforts to quarantine it, including political, cultural, and social implications.
The COVID-19 vaccination campaign in the United States is an ongoing mass immunization campaign for the COVID-19 pandemic in the United States. The Food and Drug Administration (FDA) first granted emergency use authorization to the Pfizer–BioNTech vaccine on December 10, 2020, and mass vaccinations began four days later. The Moderna vaccine was granted emergency use authorization on December 17, 2020, and the Janssen vaccine was granted emergency use authorization on February 27, 2021. It was not until April 19, 2021, that all U.S. states had opened vaccine eligibility to residents aged 16 and over. On May 10, 2021, the FDA approved the Pfizer-BioNTech vaccine for adolescents aged 12 to 15. On August 23, 2021, the FDA granted full approval to the Pfizer–BioNTech vaccine for individuals aged 16 and over.
The government of California initially responded to the COVID-19 pandemic in the state with a statewide lockdown, the first of its kind during the COVID-19 pandemic in the United States. As the pandemic progressed in California and throughout the rest of the country, the California government, following recommendations issued by the U.S. government regarding state and local government responses, began imposing social distancing measures and workplace hazard controls.
The COVID-19 pandemic in Malaysia has had a significant impact on the Malaysian economy, leading to the devaluation of the Malaysian ringgit (MYR) and the decline in the country's gross domestic product. The pandemic also adversely affected several key sectors including entertainment, markets, retail, hospitality, and tourism. Besides shortages in goods and services, many businesses had to cope with social distancing and lockdown restrictions, which affected their operations and revenue. The pandemic also drew attention to workplace safety and the exploitation of migrant workers working in Malaysian industries.
The United States' response to the COVID-19 pandemic with consists of various measures by the medical community; the federal, state, and local governments; the military; and the private sector. The public response has been highly polarized, with partisan divides being observed and a number of concurrent protests and unrest complicating the response.
The government of Texas's initial response to the COVID-19 pandemic in the state consisted of a decentralized system that was mostly reliant on local policies. As the pandemic progressed in Texas and throughout the rest of the country, the Texas government closed down several businesses and parks, and it eventually imposed a statewide stay-at-home order in late May. Then, between May and June 2020, the state government initiated a phased reopening, which was viewed as controversial. The reopening was phased back in June and July 2020 following a new surge of COVID-19 cases in the state. In March 2021, as COVID-19 vaccines began to be administered throughout the U.S., the Texas government reopened the state again.
The Great Resignation, also known as the Big Quit and the Great Reshuffle, was a mainly American economic trend in which employees voluntarily resigned from their jobs en masse, beginning in early 2021 during the COVID-19 pandemic. Among the most cited reasons for resigning included wage stagnation amid rising cost of living, limited opportunities for career advancement, hostile work environments, lack of benefits, inflexible remote-work policies, and long-lasting job dissatisfaction. Most likely to quit were workers in hospitality, healthcare, and education. In addition, many of the resigning workers were retiring Baby Boomers, who are one of the largest demographic cohorts in the United States.
1 2 U.S. Bureau of Labor Statistics (January 1, 1939). "All Employees: Total Nonfarm Payrolls". FRED, Federal Reserve Bank of St. Louis. Archived from the original on May 12, 2019. Retrieved June 4, 2019.
↑ U.S. Bureau of Labor Statistics (January 1, 1948). "Civilian Unemployment Rate". FRED, Federal Reserve Bank of St. Louis. Archived from the original on May 6, 2019. Retrieved June 4, 2019.
↑ U.S. Bureau of Labor Statistics (January 1, 1948). "Unemployment level". FRED, Federal Reserve Bank of St. Louis. Archived from the original on June 19, 2020. Retrieved June 20, 2020.
↑ U.S. Bureau of Labor Statistics (January 1, 1948). "Employment-Population Ration 25–54 Yrs". FRED, Federal Reserve Bank of St. Louis. Archived from the original on June 23, 2020. Retrieved June 22, 2020.
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