education, agriculture, health, sports and economy. The entire world came to a stand still despite the degree of technological advancement and availability of resources. Most of the countries felt helpless to deal with the crises in absence of an affective remedy . The movement of people came to a minuscule, fearing the deadly virus and man all over the world switched over to certain personal precautions like use of masks, sanitizers, avoiding visiting and touching affecting persons.he recent pandemic has affected every field of life –
The pandemic kept on spreading with an alarming rate, forcing governments all over the world to announce complete and strict lockdown in order to assume proper social distancing and contain its spread.
Economy and Education are two of the many sectors upon which this pandemic has had a variegated effect. The effects are not temporary and are expected to leave long lasting scars on these sectors. Economy is experiencing deep and a crippling g effect through lower investments, erosion of human capital through loss of employment and disturbance of world trade and transport.
The pandemic has hit at a time when the world economy was already under tough times. The investment policy monitor (IPM) indicated specific investment policy responses to the pandemic that included measures aimed at supporting investors and domestic economies so as to protect the infrastructure and industries.
The lockdown has brought down the real estate and infrastructure sector and led to a liquidity crises .The closure of manufacturing plants and factories has had a negative impact on economy which could lead to a vicious deficit in corporate capEx , decreased consumer demand and unexpected level of unemployment in the world. Investors all around are indecisive during the troubling times and it becomes imperative to take a cautious approach while investing in equity and equity related products.
They have to follow the principle of proper asset allocation while going for certain investment. The apprehension of a liquidity trap together with inflationary pressures forces the investors for short term investment. Though there are areas where one can invest but one has to be cautious, stock specific and go for a staggered approach to reduce risk.
Pandemic and Unemployment
Millions of people round the globe have lost jobs in different sectors due to the forced lockdown and concern for personal and family wellbeing. The workers are hard hit in recession and entering the labour market during this recession seems to have a negative impact on earnings and job prospects in future.
Unemployment rate in general increased by 11.2 percent between February and April 2020 but the rates among young workers was much more. Migrant workers fled urban centres and the economic activity came to a grinding halt in major cities. The world of work is profoundly affected. The economic and social disruption threatened the long-term livelihood of many. According to The International Labour Organisation, the COVID 19 crises can wipe out 6.7 percent of working hours, equivalent to 195 million full time workers. In developed economies like the US, the pandemic has been catastrophic in terms of labour and employment and it is a tale of woe across the globe.
The unemployment resulted from the closure of manufacturing units, packaging, storage and transportation. the workforce used to migrate to the potential areas of employment were confined to their homes resulting in their unemployment. The workers staying in foreign countries for long periods earning the country considerable foreign exchange had to return which caused a great jolt to the national income. This setback caused to the economy is likely to cast its pernicious shadow to overall growth of GDP.
World Trade and Transport
Pandemic has thrown challenges in trade and transport to the hilt. All means of transport having been suspended have brought the national and international trade to a grinding halt. The revenues of various modes of transport companies were reduced to a naught throwing the entire staff out of jobs. It will take a long time to these institutions to return to normalcy and regain their losses. Agricultural products, eatables and perishable items, due to their non-transportation from source caused huge losses and wastage which seems impossible to be recovered in the near future.
Author is Pursuing MSc in Economics at SMVDU Katra). He can be reached at firstname.lastname@example.org