The impact of the COVID-19 pandemic on the economy

Abstract

Due to the COVID-19 pandemic, the world has changed completely in less than two years' time. The pandemic has threatened human lives, society, and global economy. As the largest pandemic of modern times, second only to the Spanish flu, it has had a significant negative impact on the economy, especially the service sector. The goal of this paper is to analyse the impact of COVID-19 on the economy. The analysis includes short-term economic effects in the first months of the outbreak, cost-and sector-specific impact, and economic expectations. The overall conclusion is that the pandemic has had severe negative impacts on the global economy, causing a significant GDP loss, increased unemployment, and the greatest decline in retail trade, compared to other recessions in the past 40 years. However, the pandemic has also accelerated the development of the digital economy.