How much has the global lockdown cost businesses? According
to Fitch Ratings, the damage is $5 trillion. In a report published on
Wednesday, titled “The Road Back”, the agency estimates that’s how much revenue
will shrink this year alone at the companies whose debt it grades. By 2022,
sales will be $8.5 trillion lower than Fitch forecast at the end of last year.
These Fitch-rated companies had over $26 trillion of revenue
to start with. The true damage is likely to be much bigger. Still, the agency’s
estimates give some sense of the pandemic’s damage, and the torturous recovery
ahead. Looking across 80 different sectors, Fitch reckons the median decline in
revenue through 2021 is likely to be 8%. By comparison, the MSCI World Index of
large and medium-sized stocks is down just 3% since the start of the year. (By
Neil Unmack)
While governments get to grips with the human and economic
effects of Covid-19, another plague is stepping up in intensity: opioid misuse.
From Chicago to Toronto, governments are reporting spikes in the number of
overdoses and emergency calls during protracted lockdowns. The reasons aren’t
clear, but may include isolation, less availability of help and even a shift in
the composition of the drugs themselves. It threatens to make the post-pandemic
economic rebuilding even more costly.
The United States only reversed years of declining life
expectancy in 2018. The opioid epidemic, along with other so-called deaths of
despair, is a big reason why it had fallen. It’s both a direct cost – the
Centers for Disease Control and Prevention estimates $78.5 billion a year – and
an indirect one, because opioids remove productive people from the workforce.
Moreover, it’s another example of Covid-19 exacerbating underlying trends – and
turning them into economic comorbidities. (By John Foley)
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