Coronavirus could drive the U.S. into a recession, economist says

ByNathalie Granda KFSN logo
Saturday, March 14, 2020
Coronavirus could drive the U.S. into a recession, economist says
As COVID-19 cases rise, businesses face cancellations and jobs are hit, a coronavirus-driven recession could be looming.

FRESNO, Calif. -- The new coronavirus is not just a risk to your health but it could drive the economy into a recession.

"The first initial impact will be to the big businesses themselves, then it will be the smaller companies that support these companies that will start to see some layoffs," says Fresno City College economist Aaron Pankratz.

Major travel companies are already feeling the impact and economists say it could have a trickle-down effect, leading to job losses and businesses having to close their doors even at the local level.

Shops, restaurants, and movie theaters are all feeling the hit.

One of the companies that may be impacted is Brian Risinger, owner of The Oval Office Mobile Luxury Restrooms.

He says spring and fall are his busiest seasons but with COVID-19 concerns causing cancellations, the future of his business could be devastating.

"In the last 48 hours, we've had a lot of cancellations, big events, church events. This is our sole source of income. We're getting cancellations left and right," he says.

Economic experts say it's not only major airlines and cruise lines that will feel the hit but all the other small businesses that are associated with the companies.

"All the other areas we don't think of that are associated with airplanes, cruises, travel agencies, all the people that work in those industries are being affected as well. If it continues, we're going to see an actual loss of jobs," says Pankratz.

Hours earlier President Trump announced he would support an agreement with the house on legislation aimed at providing economic relief amid the pandemic.

Economists, however, say there are some industries like the tech industry, that are seeing a boost as college campuses shift online.

But for some business owners, like Risinger, the future is uncertain.

"This equipment here, I'm still making payments on it - cars, house, truck payment. I've got kids to feed like everybody else. I don't know if I start looking for a job, don't know if this is a short term problem," he says.