Nation’s GDP may lose $2.5 trillion from COVID-19 pandemic, study says

The COVID-19 pandemic is expected to reduce the U.S. gross domestic product (GDP) by $2.5 trillion and employment by 19 million full-time equivalent jobs over the next year, according to a Texas A&M AgriLife coordinated study.

This spring Texas A&M’s Department of Homeland Security (DHS) Center of Excellence Cross-Border Threat Screening and Supply Chain Defense (CTBS) teamed up with Arizona State University’s DHS Center of Excellence, the Center for Accelerating Operational Efficiency, and researchers at the Victoria University in Australia to examine the economic impacts of the pandemic on U.S. agricultural sectors. 

While certain the pandemic would have a significant impact on the U.S. economy, Greg Pompelli, Texas A&M’s CBTS director, said the researchers used this project to gain a clearer picture of the pandemic’s shorter- and longer-term impacts on the U.S. food and agriculture sectors in comparison to other critical sectors.

“This analysis gives us a critical and realistic evaluation of how the pandemic has and will continue to impact our nation’s and the world’s food supply,” said Patrick J. Stover, vice chancellor of Texas A&M AgriLife, dean of the College of Agriculture and Life Sciences and director of Texas A&M AgriLife Research. “It will be critical that we work together to elevate food system concerns and develop solutions that address the economic consequences to serve as a foundation for lasting recovery.”

To help understand these impacts, researchers utilized a model of the U.S. economy that included a special emphasis on the major food and agriculture sectors. The team used quarterly economic data in their model of the U.S. economy to determine the effects of the pandemic and the impacts of related policy responses on the U.S. economy and ag sectors.