As stay-at-home orders to battle the coronavirus are effective in most states, the virus-related restrictions have already shed 29 percent of US daily output, Moody's Analytics warns as cited by the Wall Street Journal.
The full scale of economic disaster stemming from almost countrywide closures of businesses in various industries — from entertainment to retail — will not be seen for years. However, the first estimates have already started to emerge, and the picture is quite gloomy.
According to Moody's study, which was carried when 41 states shut down non-essential businesses, California alone lost $2.8 billion a day, equivalent of more than 31.5 percent of the state's daily gross domestic product (GDP).
The drop of output in 15 other states, responsible for almost 70 percent of all the US daily GDP, is $12.5 billion, while 30 other states together with Washington DC are losing a total of $4.9 billion of GDP per day.
The economic fallout (in terms of output drop) of the coronavirus crisis has already turned worse that the consequences of the 9/11 terrorist attacks, according to the agency's data. As the result of three weeks of government-imposed closures, US output tumbled by around $350 billion, while the attacks had cut it by an estimated $111 billion in current dollars.
“It's like if Indiana disappeared for an entire year,” the chief economist of Moody's Analytics, Mark Zandi, told the WSJ. “This is a natural disaster. There's nothing in the Great Depression that is analogous to what we're experiencing now.”
If the drop persists, it could cut 75 percent of the country's annual GDP. However, the strategist does not believe that this should last long, and expects that the situation will improve before the end of the second quarter. According to the report, the analyst predicts that many counties will reopen before the summer.
As of Sunday, more than 310,000 people were infected with coronavirus across the US — around 25 percent of total number of cases across the globe, according to the Johns Hopkins University.