“Our airline’s well being has become grave overnight”
This isn’t a line from a hollywood movie but an interanal memo that has been sent to the West Jet union by the West Jet airlines which is a fairly large airline with roughly 14,000 employees.
That one sentence indicates that the on going situation is no laughing matter at all. While whole world is daunted about tackling the pandemic,the economy is slowly hitting the rock bottom.
Industries, all around the world are shutting down in order to let people self quarantine and control the spread which is a good thing but this comes at a price.
As per last year the uneployment rate was 7.7% but, it is expected to increase twofold by the end of the year 2020. With people out of work and unwaged the consumer debt will increase sky high. Many people continue their living based upon mortgages, personal loans and simply upon debt. But soon, the unemployment will leave them hindering to pay these debts. As the governments become incapable to chargeback, the countries will plunge into an abyss of debt, ergo the economy will have a great hit. The stock market lost 20% of its value just within 21 days making it the fastest, sharpest bear market on record, 10 times faster than 2007 financial crisis. Although the market can handle a large hit to the economy, it cannot be driven with uncertainity. But inorder to sustain the medical system the economy needs to halt, there’s no debate on that but with rapid increase of unemployed people the economy will be hampered in the next couple of years.
Yes ! It’s scary and no!, nobody anticipates a recession but we will have to confront with negative consequences at some point,no matter how unpleasant it is. It doesn’t matter what we think, is happening right now because the world is shutting down and there’s nothing we can do about it! All we have left now is to take security measures until this epidemic is under control!
Photo by Aleksei mln