Impact of Covid-19 on the global economy
The Covid-19 pandemic, which had a considerable impact on the global economy, resulted in an unprecedented recession. Air transport was the sector hardest hit by the health crisis, with a sudden and abrupt halt to all activities worldwide.
In just a few days, virtually all flights were cancelled, airports closed, the global fleet grounded, and millions of employees laid off. The production lines of the world's two leading aircraft manufacturers, Boeing and Airbus, slowed to a crawl, with orders cancelled and aircraft deliveries delayed.
The International Air Transport Association (IATA) estimates the loss of the aviation market at 252 billion USD.
Tourism, along with hotels and restaurants, is the second most affected sector. Lockdown measures and travel restrictions have led to colossal operating losses in the accommodation, food and catering sectors. Thousands of lawsuits have been filed by restaurant owners against their insurers.
The events industry, another sector severely affected by the pandemic, had a hard time getting through 2020 and 2021: sports events, festivals, trade fairs, trade shows, fashion shows, etc. were all cancelled, and the Tokyo Olympic Games, a major world event, was delayed by a year.
This chaotic situation had repercussions on GDP and unemployment rates in all the world's economies.
Read also | Insurance and Covid-19
Unemployment rate and global GDP growth: 2018-2022
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Unemployment rate (1) | 5.70% | 5.50% | 6.90% | 6.20% | 5.80% |
| GDP evolution (2) | 3.60% | 2.80% | -2.80% | 6.30% | 3.40% |
(1) Source: World Bank
(2) Source: International Monetary Fund
Covid-19 has particularly impacted the year 2020, with a simultaneous deterioration in the unemployment rate (+25% in one year) and a decrease in GDP from 2.8% growth in 2019 to a decline of 2.8% by the end of 2020.
Even China, the world's growth champion, saw its GDP fall by 6.8% in 2020, the first drop in China's GDP since 1992.
Change in hours worked (population aged 15 to 64)
In a further indication of the impact of Covid-19 on the economy, the International Labor Organization's Observatory reported an 18.7% drop in the number of hours worked in the second quarter of 2020, following an initial 4.9% decline in the first quarter of the previous year.
