COVID-19 Unemployment Could Kill 1.37M: Economists

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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.

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.

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