President Donald Trump has grasped the likely lethality of a recession to argue that the US economy should be reopened as soon as possible.
“You have suicides on things like that when you have terrible savings,” Trump said at a press conference on March 24. “You are dead. Probably – and I mean certainly – would be in far greater numbers than the numbers that we are talking about about the virus. “
COVID-19 has so far killed more than 100,000 people worldwide, according to Johns Hopkins University.
Some economists believe that number could increase significantly if you factor in the financial fallout from virus containment measures that have shut down entire sectors of the economy and thrown millions of people out of work.
Philip Thomas, professor of risk management at the University of Bristol, said that the coronavirus pandemic will severely disrupt businesses for at least a year, resulting in a drop in economic output of 6.4% per person in the UK. In such a scenario, fewer people in the UK would be employed, and workers would generally report smaller paychecks. His recently published research has concluded (PDF) that such a slowdown will result in more deaths than the pandemic itself.
“It turns out that the United Kingdom experienced a similar drop of 6% in GDP per capita between 2007 and 2009 in the financial crash,” Thomas told Al Jazeera. “This has led to a slowdown in growth in life expectancy, reducing at least the tipping point by three months compared to average life expectancy. “
In his article, Thomas showed that in the United Kingdom, life expectancy is stable and, in some cases, decreased, a few years after the great recession of 2007-2009. He explained that when a country’s wealth declines, citizens are exposed to greater health risks.
“People in wealthy countries tend to live longer than people in poor countries because they can afford to devote more resources to health and safety measures, ranging from clean water and sanitation , paying for safer work practices in the industry, providing high-quality medical services, “said Thomas.
But Thomas has his detractors. And while they may agree that economic downturns affect health outcomes, other researchers have disputed the number of people who will be affected by a coronavirus-induced recession.
“The study jumps out of [people in richer countries living longer] assuming that the decline in GDP as a result of pandemic suppression measures would directly translate into reduced life expectancy, “said Jonathan Portes, professor of economics and public policy at King’s College London.
“It doesn’t follow – and in fact, we have plenty of evidence that short-term reductions in GDP don’t translate into lower life expectancy, on the contrary,” said Portes to Al Jazeera.
Are recessions good for your health?
Clemens Noelke is a researcher at Brandeis University, whose work examines the relationship between recessions and mortality in older American adults.
“It’s hard to extrapolate from the previous database. It looks like we are headed for a deep recession after a decade of economic expansion in the United States, “Noelke told Al Jazeera. “However, to my knowledge, we have no evidence of the impact of recessions flanked by a global pandemic. Based on the research we have on past recessions, we should actually expect lower death rates due to the economic downturn. “
The argument that recessions can lead people to live longer may seem counterintuitive, but Noelke explained that economic downturns can sometimes have health benefits.
“During recessions, economic activity contracts, pollution decreases, working hours decrease, people have more time for themselves and for others, deaths due to traffic accidents and deaths due to cardiovascular disease, “said Noelke. “So, paradoxically, perhaps, a significant part of the population is experiencing an improvement in their health. There is much evidence to support these conclusions. Studies have shown that between 1960 and 2010, death rates in the United States and the United Kingdom fell by 0.5% for each 1% increase in unemployment.
Who dies could depend on economic role
This however applies to the general population. For those who effectively lose their jobs in a severe economic downturn, and for those working in the affected industries, deaths have increased.
“It is important to note that these impacts are very unevenly distributed across the population,” said Noelke. “Many people lose their jobs, their savings and their assets, and may not be able to recover. It is a contributing factor to an increase in suicide rates that occur during recessions, even though deaths from other causes are decreasing. “
The governments of many countries, including the United States and the United Kingdom, have increase unemployment benefits, and help companies pay their employeesin order to alleviate the blow of a virus-induced recession.
Noelke’s own research has shown that older workers are more likely to die after losing their jobs, especially if they are lost during a recession. Losing a job can lead to prolonged stress, which increases the risk of mental health problems and opioid abuse.
While Noelke disagreed that economic downturns result in negative health outcomes for the general population, Thomas still believed that the threat was more general than some of the academic data could show. He said the difference is due to the fact that the effects of recessions appear much later than a recession itself, so the data may not immediately show an increase in deaths.
“If you look at the data on life expectancy in the United Kingdom, you will see that after the crash of 2007-2009, there was a lag before the continued growth in life expectancy which was the norm for 30 years has only started to slow down, “said Thomas. “If you had looked at life expectancy during the crash and, indeed, during the first two years afterwards, you could have concluded that it was still increasing … But the negative effect of the reduction in GDP was real, it is just came a little later, and it lasted a long time. ”