A Texas A&M University AgriLife study has shown that COVID-19 will reduce U.S. gross domestic by 11.9% or $2.5 trillion. This is equivalent to 19 million full-time jobs. Beyond the borders of the United States, the World Bank predicts that COVID-19 created a global recession that has impacted the economy of more countries than were hit during the Great Depression.
What This Means for Ag: While the outbreak has affected every industry, compared to other sectors such as tourism, education, and lodging, the U.S. food and agricultural sectors are projected to experience less economic impact. The ag community was not subject to the same types of shutdowns and reductions. However, supply-chain disruptions such as closure of processing facilities, restaurant closures, and farm labor shortages have taken their financial toll on the food production community.
What’s Coming Next: The second wave of the pandemic is unpredictable, but the U.S. economy is expected to recover though the financial state has been hit long-term. According to researchers, GDP and employment will remain about 5% below their pre-COVID-19 rates. The USDA has reported that U.S. exports will increase in 2021 by $5.5 billion.