COVID-19 pandemic triggered 'economic contagion,' costing world's economy $3.8T and leaving 147M unemployed

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The coronavirus pandemic has had an enormous impact on the planet in all facets of life. Now, a new study has quantified just how big that impact has been on the global economy: a loss of $3.8 trillion and 147 million people without jobs.

COVID-19 has had an effect on all countries around the globe, the researchers noted; in particular, the travel industry has been especially hard-hit in areas like Asia, Europe and the U.S.

However, the international team of researchers also found the pandemic and the corresponding lockdowns resulted in the "biggest-ever drop in greenhouse gas emissions."

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“We are experiencing the worst economic shock since the Great Depression, while at the same time we have experienced the greatest drop in greenhouse gas emissions since the burning of fossil fuels began,” study co-author Dr. Arunima Malik said in a statement.

“The contrast between the socio-economic and the environmental variables reveals the dilemma of the global socio-economic system – our study highlights the interconnected nature of international supply chains, with observable global spillover effects across a range of industry sectors, such as manufacturing, tourism and transport," Malik added.

In their research, the experts found that nearly 3 billion people were asked to stay at home because of lockdowns, including more than 1 billion in India. Thirty-eight regions around the world with 26 different industry sectors were observed for the study.

The 147 million people who lost their jobs, either through furlough or layoffs, resulted in $2.1 trillion in lost income. Of that amount, $536 billion came from a reduction in international trade.

"Ironically, the loss of connectivity imposed to prevent the spread of the COVID-19 has triggered an economic 'contagion,'" the researchers added.

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Other industries that have been severely impacted include energy and finance, with "the indirect effects transmitted along international supply chains are being felt across the entire world economy," the researchers added in the study's abstract.

In contrast to some world leaders, the researchers warned that lifting the COVID-19-linked lockdowns "too soon could result in more severe and prolonged economic impacts."

In particular, several states around the U.S. have seen resurgences in coronavirus cases, with many public health officials saying these states reopened too soon, resulting in rollbacks or paused reopenings.

In May, Fox News reported that the U.S. Treasury was poised to borrow more than $3 trillion for coronavirus relief. Other governments around the world have taken similar actions.

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Central banks, including the Federal Reserve, have also taken significant steps to subvert the decline in economic activity caused by the pandemic.

Despite the severe negative impacts on the global economy, the researchers also highlighted the significant drop in greenhouse gas emissions. They estimated the lockdowns have resulted in a drop of 2.5 gigatons, or approximately 4.6 percent of normal.

The researchers said that the PM2.5 particulate dropped approximately 3.8 percent, while sulfur dioxide, which comes from burning fossil fuels, dropped 2.9 percent.

“In addition to the sudden drop in climate-change inducing greenhouse gases, prevented deaths from air pollution are of major significance," Malik explained.

The researchers used data up until May 22, 2020, to come up with their conclusions. The study has been published in PLOS One.

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As of Tuesday morning, more than 13.1 million coronavirus cases have been diagnosed worldwide, more than 3.3 million of which are in the U.S., the most impacted country on the planet.

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