On March 27, 2020, former President Donald Trump signed a $2 trillion stimulus bill aimed to help individuals and businesses in light of the economic crisis caused by the coronavirus pandemic. The bill includes individual payouts of up to $1,200 for every American adult, increased unemployment benefits, $100 billion in funding for hospitals and $58 billion for the airline industry.
Other struggling industries — including the oil and cruise industry — were hoping for aid as well but ended up with nothing. However, the bill might not be enough to get the airline industry back to where it once was. And the airline industry is not the only one that’s been hit hard by the coronavirus. All of these 19 American industries are struggling right now.
With people around the world being asked to stay home and travel bans preventing people from entering and leaving certain countries becoming more common, the airline industry has been suffering major losses. Vertical Research Partners said that passenger revenues could decline to zero by the end of the first quarter and stay there for the whole year, Reuters reported.
Many major airlines have taken a hit. For example, last year Lufthansa idled 700 of its 763 aircraft, and Qantas made plans to cut all international flights, which means 30,000 of its workers would need to take paid or unpaid leave.
The airline industry has been asking for government aid to get through the crisis, and on March 27, 2020, the U.S.’s coronavirus aid package passed, which would provide $58 billion to the American airline industry, Business Insider reported. The bill protects airline employee jobs through Sept. 30.
Many stakeholders see this as a win, including Delta Airlines and the Association of Flight Attendants.
“This is an unprecedented win for frontline aviation workers and a template all workers can build from,” Association of Flight Attendants president Sara Nelson said in a statement obtained by Business Insider. “The payroll grants we won in this bill will save hundreds of thousands of jobs and will keep working people connected to healthcare many will need during this pandemic.”
However, other experts think the bailout won’t be enough to save the industry, which relies on passengers to make revenue.
“We have an airline industry right now that is flying empty planes,” airline consultant Mike Boyd told CNN. “This isn’t going to save the industry unless we get back in [the] business of flying people.” And it’s unknown when that time might come.
“We’re talking about at least six to eight months down the road before flying starts to resume at anything approaching normal,” Boyd said. “And even then, we’re likely to see a significant reduction. One way or another, we’re going to have a smaller airline industry.”
Ford, General Motors, Fiat Chrysler, Honda, Toyota, Nissan and Hyundai have all shut down manufacturing plants amid concerns about the spread of the coronavirus, ABC News reported. The closing of Ford, General Motors and Fiat Chrysler’s Detroit facilities will leave 150,000 workers without jobs, though they are likely to receive supplemental pay in addition to unemployment benefits.
However, the slowdown in demand for cars as a result of the coronavirus could have major ripple effects. According to one projection, for every seven-day period that consumers stop buying new vehicles, the U.S. economy would lose roughly 94,400 jobs and $7.3 billion in overall earnings, NBC News reported.
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Although the construction industry is pushing to be seen as “essential” to keep their projects running, there could still be some major impacts to the industry. The shutdown of the production of construction materials in China could lead to material delays and more expensive materials stateside, Construction Dive reported. It could also lead to fewer projects, especially in the realm of hospitality, as clients and lenders pull back on funding and expansion in these times of uncertainty.
“My gut tells me we’re going to see higher prices and projects canceled, although I can’t point to the extent of it,” Joe Natarelli, national construction industry leader at accounting services firm Marcum, told Construction Dive.
All the major cruise lines have ceased operations as countries continue to close their ports. Thousands of workers have lost their jobs — both those who work on the cruise ships and those who work at the ports — and the values of the three biggest U.S. cruise lines — Carnival, Royal Caribbean and Norwegian — have all plummeted, The Guardian reported.
“This will be a disastrous time for the industry,” Dr. Christopher Muller, a senior professor at Boston University’s School of Hospitality Administration, told The Guardian. “When you have 3,500 people booked on one of these mega cruises and the boat doesn’t go, it’s an enormous expense. Someone’s paying for that boat that’s sitting idle in the harbor and it’s very hard to recapture those ongoing fixed-cost losses.”
However, he believes the industry will be able to bounce back eventually.
“The logical thing is they will have to have very deep discounts, and those deep discounts will be especially present in the next cycle of cruise seasonality in September,” Muller said. “By August and September, the consuming public will be enticed to go back on cruises because the pricing is going to be outrageously good with enormous discounts.”
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Film and TV Production
Major networks and film studios have put a halt on production as a result of the coronavirus outbreak. Netflix has stopped production on all shows in the U.S. and Canada, including “Stranger Things” season four; NBC Universal has suspended production on 35 or more shows; and Warner Bros., Disney +, Apple TV +, CBS, AMC and Viacom have all also paused production on their shows, Forbes reported.
The release dates of several major films have also been pushed, including “Wonder Woman 1984,” “In the Heights,” “Black Widow” and “A Quiet Place Part II,” while others have been released straight to streaming.
Over 100,000 entertainment industry workers have lost their jobs, while studios, networks and producers face major losses, the Los Angeles Times reported.
“There may be irrecoverable losses to the movie and entertainment industry,” Brian Kingman, who helps film and television companies find insurance policies, told the Los Angeles Times. “It’s going to take a long time to sort out.”
As a result of the coronavirus, 92% of all of the casinos in America are now closed, including those in Las Vegas, the Las Vegas Review-Journal reported. In addition, the legal sports betting industry is also suffering as live sporting events have been canceled or postponed, Business Insider reported.
These closures not only affect the hospitality and gaming employees who are now out of work, but also the U.S. economy as a whole. If casinos remain closed for two months, it would rob the U.S. economy of $43.5 billion in economic activity, the Las Vegas Review-Journal reported.
Many gyms and fitness studios have temporarily closed as a result of the coronavirus. But the pandemic hasn’t been bad for all sectors of the fitness industry — it’s actually been good news for Peloton, which has seen an increase in share prices, CNBC reported. But as people invest more in their at-home gyms while traditional gyms and fitness studios are closed, they might be reluctant to go back once they are open, feeling that they need to justify the thousands they just spent on new equipment.
As people stay home and limit travel, hotel rooms across the country are remaining empty. The American Hotel and Lodging Association predicts that 45% of all hotel jobs have been eliminated or will be eliminated in the next few weeks, with a 30% drop in hotel occupancy over a full year resulting in the loss of nearly 4 million hotel jobs, Axios reported. The hotel industry is currently losing $1.4 billion in revenue every week.
Hyatt, Marriott and Hilton have all confirmed plans to place thousands of workers on furloughs, with Hyatt stating that it would cut the salaries of all its employees from April 1 through May 31, USA Today reported.
Chip Rogers, president and CEO of the American Hotel & Lodging Association, predicts that 50% of all American hotels will close — at least temporarily — due to the coronavirus outbreak.
The coronavirus crisis “represent[s] an existential threat to the cinema business like no other,” Variety reported. Many large cinema chains have announced they would be closed for six to 12 weeks. Big movie theater chains have lost their market value while smaller chains are struggling to pay their rents, and employees are suffering job losses and furloughs.
Despite all of the factors stacked against them, some industry stakeholders are optimistic about the movie business’ ability to recover.
“I think theaters will survive,” Chris Aronson, domestic distribution president at Paramount, told Variety. “It may be altered, and the landscape might be different. But it’ll survive.”
Major music festivals, including SXSW and Coachella, have been postponed or canceled, as have concerts from the likes of Madonna and Pearl Jam. Promoters and artists are both feeling the fallout, with no real way to predict when live concerts can resume.
Analysts predict the music industry may lose $5 billion as a result of the coronavirus, due to lost concert revenue, cancellation costs, other legal costs and rearrangement fees, Forbes reported.
Oil and Gas
As of March 30, oil prices had fallen to their lowest point in 17 years as a result of both the price war between Saudi Arabia and Russia and the coronavirus pandemic, which has led to a decrease in demand.
“The world is facing a hugely deflationary shock,” ANZ Research’s Kishti Sen said in a note, as reported by CNBC. “The WTI oil price has dropped from $60 in January to around $20. Demand for many goods has plummeted, as economic activity has gone into stasis. The deepening pandemic and reduced appetite for crude oil by refiners sent the oil price into a tailspin.”
Low prices could lead to bankruptcies, especially for smaller companies that rely on higher oil prices to remain profitable, NPR reported. It could also mean fewer shifts for oil workers.
Much of the traditional real estate business involves lots of person-to-person interaction, so the coronavirus has thrown a wrench into business-as-usual. Brokers, buyers and sellers are all struggling as open houses are being eliminated or moved to digital platforms, The New York Times reported.
Restaurants and Food Service
Shutdowns across cities and states have led to a mass of sudden restaurant closures. Now, many restaurants are on the verge of collapse and 15.6 million restaurant workers are facing job loss or reduction of hours, NPR reported.
“The coronavirus epidemic, it’s unchartered territory for us,” Sean Kennedy, a spokesman for the National Restaurant Association, told the public radio station.
In addition to restaurant workers losing jobs, it’s also likely that many restaurant owners won’t be able to recover from the closures as many already run on very thin margins, Today reported.
Macy’s, Nordstrom, Nike and Apple have all closed their U.S. stores, and Simon, the country’s largest mall operator, closed over 200 of its shopping centers, the U.S. Chamber of Commerce reported.
“Retail is the nation’s largest private-sector employer, supporting 52 million jobs overall,” Matt Shay, president and CEO of the National Retail Federation, told CO, the U.S. Chamber of Commerce blog. “While select retailers are not seeing diminished sales — warehouse clubs, grocery and drug stores — as consumers stock up on essential items, others are struggling.”
Online shopping has increased, but it’s unclear if and when overall consumer spending will bounce back. Decreased spending means that some retailers won’t be able to meet loan obligations. And it also means job loss for people working in the retail sector. For example, Macy’s has furloughed 125,000 employees as a result of the coronavirus shutdown, The Washington Post reported.
Global supply chain interruptions that started in China have now led to a crisis for container ship operators. There’s less product to move, so as a result, vessels are being idled and scheduled trips have been canceled, NPR reported.
“For the periods of late February, March and April, you could be talking anywhere from 15% to 30% of the freight that normally flows in and out of this country will not be happening,” John Reinhart, CEO of the Port of Virginia, told the radio station.
This means a reduction of hours for drivers of these ships, as well as for workers at the ports, and other workers whose business relies on the shipping industry.
International sports had been a booming business for years, but the coronavirus has stopped the industry’s economic climb dead in its tracks. The cancellation of March Madness has caused the NCAA to reduce its annual distribution to member institutions by nearly two-thirds — from $600 million to $225 million — while amateur U.S. sports could lose around $800 million due to the delay of the Summer Olympics, The Wall Street Journal reported. NBA players are confined to working out in their homes as gyms and arenas are closed, and MLB players face a shutdown of unpredictable length.
The abrupt pause on professional sports will lead to major losses for team owners, as well as for the networks that broadcast the games. Media analyst Michael Nathanson forecast that if the NBA were to shut down the season and cancel the playoffs, it would cost ESPN and ABC $481 million and TNT $211 million in lost ad revenue, according to The Wall Street Journal.
There are also losses from ticket sales, merchandise sales, food and parking fees, and millions of dollars in lost wages for arena workers, FiveThirtyEight reported.
The coronavirus pandemic has disrupted the tech industry in numerous ways. For starters, it has caused major supply chain delays for companies like Apple, which manufactures many of its iPhones in China. As a result, Apple analyst Ming-Chi Kuo has lowered his iPhone shipment forecast by 10% for the first quarter of 2020, MacRumors reported. It’s also caused the cancellation of major tech conferences, including the Mobile World Congress and Facebook’s Global Marketing Summit. The direct economic losses from the cancellation of major tech events will total $1.1 billion, according to estimates by data intelligence company PredictHQ, Recode reported.
Disney has closed its U.S. theme parks amid the coronavirus outbreak, and the combination of closures plus a dip in attendance due to a likely recession following the closures means that the parks could face a $3.4 billion revenue loss, an analyst report from research firm MoffettNathanson found, according to The Orange County Register.
Meanwhile, SeaWorld announced on March 27 that it will furlough 90% of its workers without compensation beginning April 1, ClickOrlando.com reported. The move comes after the theme park’s parent company temporarily shuttered all of its theme parks in California, Florida, Texas and Virginia. The closure of SeaWorld’s U.S. parks could cost the company $233 million in lost revenue in 2020, according to a J.P.Morgan analyst’s report, the Daily Bulletin reported.
Other theme parks have also closed temporarily, including Universal Orlando Resort, Business Insider reported.
The demand for trucking is at a low as the coronavirus spreads, Business Insider reported. Although there is a need for truckers to move retail products, those that haul products from other sectors, including automobile and oil, have seen their demand decrease.
A March 11 Morgan Stanley survey of 350 freight-transportation stakeholders found that 80% said the coronavirus is affecting their business. There are 1.8 million truck drivers in America, many of whom are self-employed, so they are hit especially hard when they don’t have jobs to do.
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