Economics professor looks at impact COVID-19 could have
SAVANNAH, Ga. (WTOC) - As festivals and sporting events are called off and people are cancelling travel plans for the foreseeable future, some are worried about the economic impact coronavirus could have both locally and across the nation.
COVID-19 is hitting industries like travel, hospitality, and restaurants hard.
At Georgia Southern University’s Armstrong Campus, Dr. Richard McGrath, an economics professor, says broader economic implications are still hard to predict, but expect the stock market to continue to show movement.
“The financial markets do tend to overreact to things very quickly, and so we’ll see a lot of volatility for a while until the information with the coronavirus settles out, and we have a better idea of how long it’s going to stick around or how long until we can get it under control,” McGrath said.
He says the coronavirus is causing a real slowdown in economic activity, which has the potential to trigger a significant recession.
Regionally, with events like the Final Four in Atlanta and the Master’s being cancelled or postponed, or locally, with St. Patrick’s Day celebrations being cancelled, we will see an impact.
“You have multiple components, so one component is travel. Lots of people who would be going to those events won’t be traveling, that means the hospitality industry, the hotel industry, the restaurant industry in those locations are all being affected. In addition, though, we think of the businesses, but we also need to think of the workers," McGrath explained. "Dozens, hundreds, could be a thousand part-time workers who only get work when there’s an event.”
But, he says all this shouldn’t be a cause for panic.
“Panicking does nothing of value. Should people recognize that if you depend in the springtime for that big boost of income in tips from working St. Patrick’s week that you’re probably not going to make as much? Yes, that’s going to be a concern, but I think the people in those jobs probably know to plan for that.”
McGrath says the economy can recover quickly if the spread of coronavirus is controlled in a reasonable amount of time.
He also recommended that anyone with concerns reach out to their financial advisor.
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