As the outbreak of COVID-19 continues to grow in both numeric and geographic terms, its impact on the global economy is staggering. As of the afternoon of March 11, 2020, COVID-19 has found its way into at least 114 countries across the world and has killed over 4,000 people. To prevent the further spreading of the infectious disease, The Centers for Disease Control and Prevention (“CDC”) issued guidelines for people to follow that reduce the likelihood that the disease will spread. These practices include “school dismissals, event cancellations, social distancing, and creating employee plans to work remotely[.]” These measures have and will continue to make economic impacts not only here in the United States but worldwide.
Because of how quickly the disease can spread, the most effective model for preventing its spread has been containing and quarantining affected areas. The outbreak started in the state of Hubei in China, and the number of people it affected there rose from roughly 1,000 to over 80,000 in six weeks. To curb the spread of the disease, China enacted lockdowns and forced quarantines of certain geographical areas. This had profound effects on the country’s economy. It is estimated that, as of March 8, 2020, China’s economy was running at about 76% of capacity. The economic shutdowns China implemented included “extended holidays, depressed factory output, and blocked transport and movement across the country.” This led to a 17.2% decrease in exports and a 4% decrease in imports. These measures have already impacted international corporations, such as Apple, Microsoft, AB InBev, and Pfizer, and “[e]conomists caution that [China’s] shutdown threatens the economies of Japan, South Korea, Europe[,] and even the United States.”
The United States faces its own outbreak, with economic impacts of its own. “The U.S. surpasse[d] 1,700 confirmed or presumptive cases, while the death toll reache[d] 41.” But one high-profile diagnosis accelerated the severity of the virus’s potential impact on the United States. The National Basketball Association (“NBA”) All-Star Rudy Gobert tested positive for COVID-19 on March 11, 2020, which caused the NBA to announce that the its season is indefinitely suspended to determine the next steps to take to prevent the spread of the disease. This caused the entire sports world to react in a big way: the National Collegiate Athletic Association (“NCAA”) cancelled all regional basketball championship tournaments, as well as March Madness and all other winter season championship events; the Major League Baseball (“MLB”) cancelled the rest of spring training and suspended the start of the season for at least two weeks; the National Hockey League (“NHL”) indefinitely suspended its season; the Professional Golfers’ Association (“PGA”) Tour cancelled the Players Championship; and the Major League Soccer (“MLS”) suspended play for at least thirty days.
The economic impact of these cancellations will be huge. March Madness brings in annual revenues of $1 billion alone for the three weekends it takes place. The NBA is an $8 billion industry per year, and with most of that money being made during the playoffs, the league is set to lose hundreds of millions of dollars if it is unable to reschedule the remainder of the season. Other league and event cancellations and suspensions will have similar economic impacts.
The shock of these massive event cancellations, along with the CDC guidelines, will also have an impact on consumer behavior. In the United States, these sporting events are the main mass-gatherings of people, and the cancellations have made people realize that the best way to avoid the virus is to avoid other people. As a result, there is massive uncertainty about how consumers will change their spending habits, and the financial markets have responded accordingly. March 12, 2020 proved to be the biggest ever single-day point drop for the Dow Jones Industrial Average, and the largest percentage drop since the crash of 1987.
Unfortunately, it seems as though this may only be the beginning of the economic impacts of COVID-19. As the United States continues to ramp up testing for the virus, it is inevitable that more cases are confirmed, potentially causing more cancellations of events and other economically important activity. It will be interesting to see how the increase in the number of confirmed cases will further impact the U.S. and world economies.
* J.D. Candidate, May 2020, Florida International University College of Law
 Bill Chappell, Coronavirus: COVID-19 Is Now Officially a Pandemic, WHO Says, NPR (Mar. 11, 2020), https://www.npr.org/sections/goatsandsoda/2020/03/11/814474930/coronavirus-covid-19-is-now-officially-a-pandemic-who-says.
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