Policymakers should think harder about how to keep the economic impact of the COVID-19 pandemic from killing people, three economists write.
The economists look at the possible effects of pandemic-related unemployment on U.S. adults’ mortality rates and life expectancy in a new working paper published on the National Bureau of Economic Research website.
The economists predict that, over the next 10 years, pandemic-related unemployment could cause about 460,000 excess deaths in the United States, on top of the number of people killed by COVID-19 itself.
The total number of excess deaths could rise to 890,00 by 2035, and to 1.37 million people by 2040.
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The economists — Francesco Bianchi, Giada Bianchi and Dongho Song — came up with those predictions by analyzing how changes in U.S. unemployment rates have correlated with changes in U.S. mortality figures in recent decades.
Past studies have shown that unemployment can increase mortality rates by decreasing use of preventive care, increasing the suicide rate, and increasing the odds people will die from cardiovascular disease, the economists write.
Up till now, the economists write, pandemic economic impact studies have focused on how lockdowns will reduce mortality in the short run, by keeping people from dying in accidents as well as from COVID-19.
Over the long run, however, “the typical unemployment shock results in a statistically significant decline in life expectancy and increase in mortality rates for the overall population,” the economists write. “The effect of the unemployment shock on the growth rate of life expectancy and the death rate reaches its peak in the third year and remains elevated for a long time.”
The COVID-19 unemployment shock is more than three times larger than the typical shock to the unemployment rate, the economists say.
“We estimate that this unprecedented unemployment shock will result in a 3.01% increase in mortality rates and a 0.50% drop in life expectancy over the next 15 years,” the economists warn.
The number of excess deaths caused by pandemic-related unemployment could amount to abut 0.25% of the projected U.S. population in 2035, or about 1 in 400 people, and about 0.37% of the projected U.S. population in 2040, or about 1 in 270 people, the economists estimate.
“Without any doubt, lockdowns save lives, but they also contribute to the decline in real activity that can have severe consequences on health,” the economists write. “Policymakers should therefore consider combining lockdowns with policy interventions meant to reduce economic distress.”
Policymakers should try to guarantee that people have access to health care, and they should promote strategies, such as mask-wearing and social distancing in the workplace, that can help businesses reopen while limiting the spread of the virus that causes COVID-19, the economists say.
— Read How to Handle Clients Who Lose Jobs in the Pandemic, on ThinkAdvisor.