The economic consequences of a new lockdown

Some industries in Serbia know very well how much the previous lockdown has cost them, others have almost breathed a sigh of relief and started working again, and both are aware of how much a new lockdown would add an extra blow to the whole economy.

Experience says that the consequences at the end of the supply chain would be indirectly felt by the entire economy and that the negative effects would be felt by citizens and workers alike, on multiple fronts.

Plus, a lockdown would further reduce consumption and thus production. The negative cycle would extend to employees from two angles: from the reduced volume of business and in terms of paying salaries which would eventually become unsustainable and a company would be forced to close.

The consequences would then extend further, through reduced exports and a drop in investments, and eventually a drop in the country’s economic growth rate. In a situation where there is maximum economic growth, i.e. the smallest decline, unemployment of only 9% and the ability to increase wages and pensions, this is not needed.

Catering and tourism have already been brought to their knees. More than half the people in travel agencies have lost their jobs by mid-2020. One in three workers working in catering facilities and hotels has lost their jobs while more than 60% of workers in tourism have lost their jobs since March.

The latest European statistical reports have confirmed that seasonal workers, casual workers and temporary workers are the biggest victims of the pandemic.

According to the latest Eurostat data, the number of employees in the EU has shrunk from 22.2 million to about 19.2 in just six months last year. This means that, in the first half of 2020, the number of workers who do not have long-term job contracts decreased by more than 13%. Many European countries have not experienced such unemployment since the post-war period.

(Blic, 03.03.2021)



This post is also available in: Italiano

Share this post

Leave a Reply

Your email address will not be published. Required fields are marked *

scroll to top