Finance

U.S. economy ravaged by coronavirus pandemic

Unlike the World Financial Crisis in 2008, the U.S economy seems to be affected more severely by the COVID-19 pandemic than the other economies.

With businesses paralyzed, GDP will suffer a sharp drop: $1.5 trillion (4.8%) in production will be lost, according to the Wall Street Journal.

U.S vs UK GDP Annual Growth Rates

Many sectors, such as textiles and trade, fear that they will not be able to recover. According to Thomas Philippon, an economist at New York University, the most worrying phenomenon remains unemployment. The American authorities have not taken the necessary measures in time. For example, short-time working has not been organized, as a result, 5 Million of precarious workers are going to be abandoned.

According to analysts from the insurer Allianz, the American unemployment rate should almost double and exceed 6%. This number will be reached very quickly as it is very easy to break a work contract in the United States.

Reference

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