Due to the coronavirus, concerts, festivals, conferences, launches, premieres, screenings, film and tv shoots, theater productions, and sporting events have been canceled or postponed, tourism destinations have been closed, and whole countries have been quarantined.
In the US, affected entities include Broadway and Carnegie Hall productions, L.A. Gay Pride, SXSW, St. Patrick’s Day Parades, multiple types of Cons, Coachella, RuPaul’s Drag Con, Tomorrowland, Coachella, the launches of multiple movies, the New York City Half-Marathon, the Boston Marathon, and multiple sporting seasons including college football, baseball, soccer, the NBA, and the NHL. This is going to affect every worker who expects to earn income and tips from these events, as well as local businesses, vendors, musicians, individual players–the list goes on and on.
To put how much money is going to be lost into perspective, in 2019 SXSW economic impact totaled $355.9 million.
The Boston Marathon is estimated to bring in $200 million to the Boston economy every year.
In 2017, Coachella grossed $114 million.
But it’s not just a matter of how much money is going to be lost via events–even though it will undoubtedly affect the economic growth of certain communities. People aren’t going out and they aren’t traveling. Local restaurants, coffee shops, retail stores, and the like will be getting a severe decrease in traffic and airlines, cruise lines, hotels, inns, any hospitality or travel business will see dramatic deficits in income.
Globally speaking, there’s also a decrease in demand, so much so that stock prices of oil, wheat, copper, zinc, and other basic products have gone down, making investors less likely to put money into them. This has caused a roller coaster of extreme downs and moderate ups in Wall Street. Furthermore, interest rates of bonds are incredibly low–Germany’s bonds’ interest is in the negatives–confirming that investors are looking elsewhere to put their money.
With a decrease in demand, that means prices and production drops, which means companies lose profit and workers get laid off. These workers will then put less money into the economy because they can’t afford to. We see this globally and locally.
The evidence is clear: we’re facing a coming recession.