The Economic Cost of COVID‑19 Fatalities in 2020
Published on January 06, 2021
The high human cost and loss of life due to COVID-19 is tragic and staggering. Few people have remained untouched by the disease in one way or another, with over 20 million US cases. As of the end of 2020, the coronavirus had contributed to the death of nearly 345,000 people in the United States. While the suffering and hardships imposed by these losses are incalculable and the primary concern, the economic consequences cannot be ignored.
Although most of the fatalities have occurred among older age groups, The Perryman Group estimates that 2020 fatalities will cause a loss of more than 750,000 job-years (a person working for a year) over time (using the lower range of CDC estimates). As these direct losses flow through the economy in the coming years, the cumulative effects include declines of approximately $246 billion in gross domestic product, nearly $151 billion in personal income, and 2.5 million job-years (including multiplier effects).
It should be noted that this measure does not begin to capture the full ramifications of the virus. The morbidity and lingering effects on those infected will reduce productivity over an extended period, as will the problems with forgone or delayed medical care among the rest of the population and the mental health challenges that are posed by the ongoing crisis. In addition, there are the ongoing impacts on workers, households, and businesses the firm has been measuring and projecting on a continuing basis. The losses from fatalities are significant not only because of their magnitude, but also because they are both lingering and cannot be recouped.
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