The impact of the pandemic on the global economy!

Due to the global Coronavirus outbreak, every government took the necessary steps to combat the growing pandemic goods and the bads. 

Many businesses have been temporarily closed due to these actions, resulting in broad limitations on travel and mobility, financial market turbulence, a loss of confidence, and increased uncertainty. It will be interesting to see how different industries adapt to the new laws now that economies are opening up again.

The COVID-19 outbreak has produced a massive global economic disruption rapidly escalating and resulting in deep recessions in many countries. Despite substantial policy support, the baseline prediction forecast a 5.2% drop in world GDP in 2020. The world economy did experience the projected decline.

Increase in online transactions- Similar to school, transactions also shifted online. Online shopping and delivery systems that were put in place also became substantial employment opportunities for the people in the margins.

 Exploration- The pandemic period rendered a lot of people jobless. This may sound negative. However, it can be reviewed as an opportunity too. As a result of the pandemic, approximately four million+ small businesses emerged successfully all across the globe. This implies a rise in entrepreneurship and a new life for 4 million+ people.

New career choices- As operations shifted predominantly online, new arenas developed. The digitalization process was strengthened and fastened due to the pandemic. As a result, many doors for new work opportunities have opened up. Different avenues and career options are now available that weren’t even considered career options in the past.

Decrease in demand- During the first part of the pandemic, economic activity was severely disrupted, and a significant portion of private expenditure, including social connection, was lost. Declining consumption of products and services has been a critical cause of lost productivity.

 Decrease in labour supply- Due to travel and human interaction restrictions, employee and family member sickness, and school closures, the labour supply diminished. Many countries have encouraged or urged employees to work from home. But due to limited internet connection in developing and underdeveloped nations, fewer tasks could be conducted remotely.

Decrease in production- Delays in input delivery and limited access to capital have created operational issues for businesses, exacerbated by a growing reliance on global supply networks.

Looking at both sides of the spectrum, it is clear that the pandemic ravaged nations and was a destructive force that has led to the most significant recessions in economic history. But, its positives are where the economies have also tried their best to achieve a balance for fear of sinking the boat.