Financial health is directly related to physical health. The onslaught of COVID-19 is the testimony to it where repercussions were huge, initially. Before the world could understand the severity, the Coronavirus spread among several countries and spread among millions of people.
It forfeited millions of working hours and jobs across the nations where the virus expanded its spread. From daily wagers to big industries, all had to bear massive losses in terms of jobs and money.
The nations which were massively affected have 93 per cent of total labourers of the world. So, the losses were unbearable. Even today, people are reeling under massive pressure and in undue stress following uncertainties of livelihood.
Also, it is not that one or two sectors suffered from or suffering from it, but almost all. However, healthcare may seem to have grown, but even the best of hospitals couldn’t take up the pressure due to so many cases. Their management went kaput.
Loss of working hours
The working hour losses were massive during the phase-in 2020. 8.8 per cent, which means 255 million full-time equivalent jobs. It means around 114 million people lost their employment, which is 50 per cent of total working hours lost. Moreover, within employment, there was a 50 per cent hours of the loss.
That incurred tremendous deprivation of businesses and jobs. It was calculated with 48 hours working hours in a week on an average globally.
Notably, the work hours lost during the pandemic was four times greater than the global recession during 2008-09.
However, the working hours’ loss during the third quarter of 2020 was revised to 7.2 per cent. However, still huge to trigger troubles. It was a robust rebound than anticipated, precisely in countries with lower-middle-income.
Furthermore, the working hours globally declined to 4.6 per cent, equivalent to 130 million full-time jobs in the fourth quarter.
Inactivity, unemployment and employment
The global decrease in hours of working in 2020 created a reduction of working hours for employed. It translated into job losses for many in every sector irrespective of the country.
The United States of America witnessed the highest job loss rate during the time. Central Asia and Europe remained the least of the sufferers in that case. It may be due to the spread of the virus was much bigger than the rest of the world.
The cases were in millions in the US alone. The job retention efforts worked significantly well.
However, women staff suffered the highest job losses during the phase. In comparison to 2019, the year 2020 witnessed 114 million vacancy losses. For women, it was 5 per cent more than men.
Also, young workers had a nightmarish rate of 8.7 per cent compared to veterans. The disproportionate affair hurt the prospect of growth worldwide.
The unemployment rate surged largely due to inactivity of trades, lack of transaction and commutation. The cases of inactivity rose from 71 million to 81 million in 2020. Thus, the global labour force participation further reduced by 2.2 per cent to 58.7 in the same year.
So, global unemployment skyrocketed by 33 million.
Mindbogglingly, the unemployment rate hiked to 6.5 per cent from 1.1 per cent.
Airlines is the best way to commute, but to curb the spread, flights from nations and with several nations were cancelled. The median probability of the airlines’ sector at the beginning of January 2020 was 2.75%.
By April 2, 2020, it surged to 26.9% (ccc-). However, it bounced back and declined to 6.36% by August 31. But by that time, enough damage had been done.
Clothing and footwear
People did not socialise much during the pandemic. Thus, window shopping was out of the question. Hence, there was no purchasing. Also, people were scared of ordering them online due to the scar of the spread.
Moreover, the precautionary and mandatory lockdowns of non-essential goods led to the rest of the non-selling and buying phenomena.
However, even after the leniency in lockdowns, the sales were lesser in September and October 2020 compared to the month of February.
The sales surged in the sector as kids bought footwear and clothing for the sessions in September.
When the news of Coronavirus started spreading along with the COVID-19, FTSE and DOW Jones witnessed a drop of 3 per cent on February 24, 2020. It indicated the worsening situation of the world outside of China where the virus generated.
It led to benchmark indices falling to the abyss following the uncertainty of the market in Europe and Asia. IBEX35, CAC 40 and DAX declined by 4 per cent. However, FTSE MIB had a steeper fall of around 5 per cent.
Due to paramount worries of the pandemic outbreak, the US stock markets shook badly. The S&P 500 index, NASDAQ 100 and of course, DOW Jones Industrial Average registered their massive falls since 200.
Notably, DOW saw a fall of 1191 points. It was the biggest one day drop that the index witnessed in its history. It speaks volumes of the carnage the virus inflicted.
Not just that, almost all big markets exhibited their most significant falls on 28 February 2020. Since 2008, it was the biggest one week decline. The US treasury dipped to a record low levels.
All in all, the world of stock markets registered a whopping 30 per cent loss by March. Notably, within four minutes, the S&P 500 plummeted by 7 per cent on March 9, 2020, after it opened. It triggered a circuit breaker post the financial crisis of 2007-08.
Trading halted for almost fifteen minutes. At the day’s end, every stock market in the world was done and dusted. They all had a bad beating. The STOXX Europe 600 fell by more than 20 per cent.
The DOW Jones broke all fall records by plummeting by 2,014 points, a 7.8 per cent loss. It eclipsed the February 27 plunge by a mile.
Likewise, The Tokyo Stock Exchange’s Nikkei 225 dipped more than 20 per cent from its 52 weeks high. The European stock markets saw the worst of performance in the lifetime with an 11 per cent slip in a day’s trading.
Brokers like 101investing had predicted the sharp fall. Those who paid attention survived their funds.
On the other hand, DOW Jones furthered its plunging spree by 10 per cent.
Oil commodity market
The Coronavirus pandemic led to the collapse of the oil market in 2020 in one way more than ever. Transportation and trade stopped. Thus, there was less demand for consumption.
The lack of factory activity and travel led to a shortage of demand during the pandemic. Also, prior to the massive breakout, the International Energy Agency had predicted that there would be lesser demand in 2020 compared to 2011.
Besides, Saudi Arabia unexpectedly announcing the surge in production in March led to the market again falling by 30 per cent (It feel steeply after the start of the pandemic due to panic)
Conclusion: Every sector and industry in the world had to bear the carnage of COVID-19. Several lives were lost, and people got unemployed due to massive activity and a lack of demand.
However, the market bounced back. The work from home options worked wonders. People started online trading using brokers like 101investing and others. The investment raised the ray of hope.