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Why Economic Risk is the Real Concern with COVID-19

Updated: Nov 29, 2022


We’ve been pumped full of contradicting information with the COVID-19 pandemic. Forced to stay in our homes due to a countrywide quarantine. Nonessential businesses (I hate this description) were forced to close. Ultimately, the majority of the world is shut down. But for what? A severe respiratory disease that has infected 0.038% of the world’s population (as of today, April 27, 2020) and has a worldwide death rate of 6.93% for those that have become ill. Unfortunately, what we should fear is the economic disruption caused by the worldwide shutdown. Here’s why I feel this way.

 

Death Associated with COVID-19 is Skewed

If you walked into the casino and were told that you had a 93.07% chance to win, would you play? I know I would. And what if I said that same casino has much better odds if you don’t play the slot machines? You’d probably play Craps, Blackjack, or Poker, right? Now think about this. That same percentage of winning is the same chance you have at surviving COVID-19. You can compare the slot machines to those who were at high risk. Being considered as high risk for severe illness include the following (this was pulled from the CDC website):

  • People over the age of 65

  • People who live in a nursing home or long-term care facility

  • People with chronic lung disease or moderate to severe asthma

  • People who have serious heart conditions

  • People who are immunocompromised - This includes cancer treatment, smoking, bone marrow or organ transplantation, immune deficiencies, poorly controlled HIV or AIDS, and prolonged use of corticosteroids and other immune weakening medications

  • People with severe obesity (body mass index [BMI] of 40 or higher)

  • People with diabetes

  • People with chronic kidney disease undergoing dialysis

  • People with liver disease

So if you are a healthy individual, stop being afraid. And if you fall into one or more of the above categories, take all of the necessary precautions to limit your exposure to those infected. The sad part about this is much of the high risk for COVID-19 could have been reduced. Prioritizing your nutrition and exercise could significantly reduce your risk to COVID-19, not to mention the increased quality of life associated with a healthy lifestyle.

Socioeconomic Status is a Health Risk


In 2011, the World Health Organization committed to reducing non-communicable diseases to 25% by 2025. The 6 main risk factors associated with these diseases are inactivity, smoking, diabetes, high blood pressure, obesity, and high alcohol consumption. However, socioeconomic status was not considered. A study published in The Lancet showed that people with low socioeconomic status were 1.5 times more likely to die before the age of 85. Low socioeconomic status was comparable to inactivity in reduced life expectancy (2.1 years and 2.4 years respectively). This was higher than high blood pressure, obesity, and high alcohol consumption (1.6 years, 0.7 years, and 0.5 years, respectively).

Why is this? Low socioeconomic status is an indicator of education, income, and occupation. The lack of education for proper health leads to poor decision making, and lack of income (or sufficient income) leads to inaccessibility of necessary healthcare. The economy is severely declining and leading towards a recession due to the COVID-19 pandemic quarantine. During recessions, the middle class gets squeezed and leads to further disparity in socioeconomic classes. This is a major concern, especially with the pending recession, because many small businesses are at risk of going bankrupt. Moreover, areas of lower median household income are likely to be affected the worst due to less available digital jobs. Ultimately, this could drive the low socioeconomic numbers higher and lead to greater health risks long-term.

Recessions and Suicide


I don’t have to tell you that stress is at a very high level right now. The five most stressful events that can happen in a person’s life include the death of a loved one, divorce, moving, major illness or injury, and job loss. In the past 4 weeks, there have been 22 million Americans that have filed for unemployment. While recessions typically cause a decrease in mortality rates, suicide rates increase. (Quick note: the reason for a decrease in mortality rates due to recessions is people tend to focus more on their health, like exercise, since they have more time due to job loss. However, since we are quarantined, this isn’t possible and will lead to a decrease in overall health.) For every 1% increase in the unemployment rate, there is a subsequent increase of 1.3% in suicide rates in the U.S. Due to the significant increase in unemployment rates currently, history tells us that suicide rates in the U.S. because of the COVID-19 pandemic recession will dramatically increase. The current suicide rate in the U.S. is 15.3 per 100k people – nearly the same as COVID-19 which is 17.0 per 100k. The potential rise in suicide rates is very concerning.

Severe Economic Erosion


The economic decline due to the COVID-19 pandemic will be far greater than the damaging effects caused by the disease itself. It is projected that the Gross Domestic Product (GDP) will decline 5% for every month the country is shut down (to put things in perspective, the decline in the economy due to the 2008 recession was only 2.9%). Over two months, this will lead to a decline of $2.14 trillion. This means that every person that has been infected (not died) in the U.S. has created a subsequent decline in the economy of $2.15 million. Considering the GDP growth rate has averaged 2.23% each year for the past 10 years, it could take as much as 4-5 years for the U.S. economy to recover.

Putting It All Together


The COVID-19 pandemic has wreaked havoc on the global economy, with the U.S. taking the hardest hit. While it is a severe disease, it is not the infection that will cause the most damage. It is the economic decline and the long-term health implications associated with this decline. The middle class will take the hardest hit from this. The increased socioeconomic disparity between classes increased rates of suicide and losing ground on a thriving economy. The world as we know it has completely changed. If you are at high risk, please stay home and take care of your health. For the healthy, let’s get back to work.


What are you most concerned about with COVID-19?

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