As we near the end of summer, we wanted to take a quick look at the current state of the novel coronavirus and how it has impacted (and is impacting) the United States. These days, the coronavirus and the economy essentially work hand in hand with the economy, reacting to new developments regarding the coronavirus. It is important to understand how things are going with the virus as this can help make informed financial decisions.
This is the current state of COVID-19 in the U.S.
From a Public Health Perspective
This blog post was written on August 7, 2020, and it is important to remember that new developments with COVID-19 are happening every day. That being said, here is a quick breakdown of how the United States is faring at the time of this writing:
- Total cases – 5.1 million
- Total deaths – 163,000
Click here to view up-to-date statistics.
The coronavirus presents two different crises. First, there is a public health crisis where people are getting sick (potentially fatally). However, there is also an economic crisis that has emerged from the measures that the government has taken to minimize health risks.
Let’s take a look at some of the economic impacts of COVID-19 thus far.
From an Economic Perspective
The impact that COVID-19 has had on the economy stems from measures that the government has taken to protect its citizens. For example:
- People have been encouraged to stay home and quarantine themselves. This means that they are not spending their normal amount at brick and mortar businesses.
- Businesses that are deemed “non-essential” have been forced to close. This has led to massive layoffs and a substantial rise in unemployment.
- The government has been forced to step in by providing subsidies to people and advantageous loans to small businesses through the CARES Act.
The impact the coronavirus is having on the United States will continue for quite some time because the economy is not something that can just be turned off and back on like a light switch. Rather, the economy will come back like a dimmer switch as it will be a while before everyone has returned to work. Even then, it will probably not be normal as we used to know it.
Let’s take a look at some of the economic data so far this year:
- Twenty-two million people have filed for unemployment (a rate of 14.7%).
- Global supply chains have been disrupted, making it more difficult for American companies to get products to consumers.
- Consumer confidence dropped in April to its lowest point in six years as people are uncertain about the future.
- The US Stock market dropped 35% during mid-March but has rebounded significantly since. Market volatility has been the name of the game this year.
Unexpected Silver Linings
Throughout these challenging months of social distancing, limited economic activity, and too many Zoom calls, there are some positives that have come from the circumstances of the pandemic.
- People are paying down their credit cards. In an article from the Wall Street Journal, Equifax found that total credit card balances fell by 11% between February and June.
- In isolation, families are spending more time together. In a survey conducted by OnePoll, 66% of respondents said the pandemic brought them closer to their families.
- The average monthly expenses for family homes has dropped significantly throughout the pandemic. Families are spending less on items such as childcare, filling up on gas, and going out to restaurants – although their bill at the grocery store has gone up!
It’s worth noting that this situation is still unfolding, and we won’t be able to fully measure the extent of the virus’s impact until more data has been collected.
We hope that you’ve found this article valuable when it comes to understanding the current state of COVID-19 in the United States. If you have any questions, do not hesitate to reach out.