Do you know which city in the world was the most visited in 2019? Industries Mostly Hurt During a Pandemic Shutdown, the answer to that question is Bangkok in Thailand, and if you’ve ever been there you’ll know in the tourist areas the streets are packed with people. The city is arguably one of the most frenetic, craziest places on Earth. But if you go to Bangkok during a pandemic, you’ll be greeted by eerily quiet streets.
The tourist areas will look more like a ghost town. What that means for the people who work in the tourism industry is they will have less cash, and we can tell you, Thailand doesn’t exactly have the best welfare system. So, who else hurts during a pandemic? Today we’ll answer that question for you. So, let’s stick with Bangkok for a minute or two because it’s a good example of how people can suffer during a pandemic.
You see, when bars and clubs are forced to close their doors, the workers and the owners don’t get paid. The tourism industry in Thailand accounts for about 20 percent of the entire GDP. If the industry collapses, the country will be in serious trouble. Then you have the underground sector. Imagine you work in the Red Light district in Bangkok.
Some sources say in the whole of Thailand there are roughly 800,000 to two million people working in the business of providing certain intimate personal services to people. Many of those workers use the money they make to support their families in the province they come from.
That means paying the rent and putting food on the table, so now they are out of work the implications are very serious seeing as there is hardly a safety net of social welfare in Thailand. Since the industry is technically illegal in Thailand, those folks don’t get severance pay or unemployment.
In fact, you have to think about the millions upon millions of people in the world working illegally, who without proper documentation or labor rights, when they lose their job they are truly out of luck.
These people are the worst hit, people who work in a sector that has virtually closed down and they have no safety net, no bank to borrow from, no relatives to beg from, no government scheme that will pay all the bills. The tourism industry the world over will be crippled, and you have to remember that this industry has long arms. People affected might work in a restaurant, or work for an airline, or book tours.
The jobs in this industry are so numerous we can’t mention them all, but it’s not a stretch to say that a good part of the planet’s population are getting paid by tourism in one way or another. As for the U.S., it’s too early to say just how badly the tourism economy will be affected, but the country is very popular with foreign tourists.
According to data from “Tourism Economics”, the U.S. could stand to lose $24 billion that the sector would usually get from tourism spending and as many as 825,000 jobs jobs related to the tourism industry in the U.S. could be lost. During a pandemic there are travel restrictions, and that means airlines see losses.
But transportation in general struggles when there are restrictions on where you can travel and people are staying at home in self-quarantine. We can tell you for sure that the global airline industry will lose billions and billions during a pandemic.
You might see a 10 percent drop in passengers at the start, but when it gets a bit worse, a 20 percent drop…It all depends on the severity of the crisis, but if we’re talking Spanish Flu-bad, well, the airline industry would be crippled which explains why airlines based in the United States are currently seeking a bailout by the government.
If there is a 20 percent drop, it’s estimated that the global airline industry could stand to lose upwards of $113 billion. What is even more worrying is that the Center for Aviation said if this doesn’t improve, by May, many airlines around the world will be bankrupt.
United Airlines alone said it was predicting a $1.5 billion loss of revenue just for the month of March. Do you know how many people worldwide work directly or indirectly for the airline industry? The answer is about 65 million. The stats aren’t easy to find as to how many people work in the more general tourism industry, but it’s thought to be about 300 million people.
And the number is probably way more than that when you factor in all of those who work indirectly in the industry. The reason it’s hard to get an exact number is because tourists spend in many ways, but we know for sure, it’s one of the biggest sectors of the economy and during a global pandemic boxing match, it gets knocked down in the first round.
So, you have tourism and transportation that are really badly hit, but then when people are not going out, the service industry is also badly affected. This industry is too vast to explain all the jobs related to it, but generally it means work that involves providing people with goods or a service and could be anything from a server at a restaurant to a taxi driver to a shop clerk.
Some people in this industry might actually do okay during a pandemic since a lot of people are staying home and using services there, but if you rely on people coming to you, that could be a problem. Owning a restaurant during a pandemic isn’t a good thing, even though takeout and online orders might take some of the weight off.
The National Restaurant Association in the USA said in mid-March that over the next three months the restaurant industry stands to lose $225 billion. This could equate to anywhere between five and seven million Americans that work in that industry losing their jobs.
Not a great time to be in the food services industry. On the other hand, if you’re in the business of selling toilet paper or face masks, you might make a killing, but if you own a string or nightclubs or casinos, work in one of these places or drive people to those places, you’re in trouble. If you own a hotel in a city which normally has many visitors, you’re in big trouble.
Bangkok might be in trouble, but imagine how a city like Las Vegas will struggle during a pandemic crisis. Casinos, hotels, restaurants, red light jobs, bars, taxis, will all be hit really badly, both the owners of those establishments as well as the people they employ.
The gaming and casino business in the U.S. is a $261 billion market, and because their doors are now closed, they all expect to see huge losses. It’s hard to pin down exactly how many people worldwide work in hotels or restaurants, but just in the USA, hotels employ 1.6 million people, and one source claims that 15.3 million Americans work in the restaurant industry. Now just imagine how many people work in hotels and restaurants the world over.
The entertainment industry has been hit hard too. Many films and TV shows will have to stop production to try and limit the amount of people working closely together. And big movies have a lot of people on their payroll, a total of 2,984 people worked on the movie Avatar.
The TV and film industry will be devastated during a pandemic. That means not just rich actors out of work who can afford to take a few days off, but people who work behind the scenes, or as background actors, or any of the number of smaller roles involved with the production of film and TV.
The theaters that play those movies also have to close their doors, not just because there aren’t new movies coming out but also to limit how many people are gathered in a small space, so they also lose out. The film industry’s U.S. box office for 2019 was over $11 billion dollars.
If theaters are shut down for a year or more then that number drops to zero. Then there’s the music industry. As you might be aware, musicians these days make most of their money from concerts since selling albums isn’t like it was in the old days. Those concerts employ a lot of other people, too.
You also have festivals, where thousands upon thousands of people squeeze together to watch their favorite bands. Well, you can’t have that during a pandemic, so massive festivals such as Coachella or Glastonbury will have to cancel during a pandemic. Another multi billion dollar industry gone.
There’s the sports industry, and when games are not being played that are usually watched in stadiums or being live-streamed, certain segments of that industry will be losing millions and millions. Even if you play the games but lose the crowds, the ticket revenue loss will be huge. Ok, so a lot of people in the U.S. like to go and see NBA games or NFL games, but can you even imagine how many people watch soccer week in, week out, over the entire globe.
It’s estimated that worldwide there are 3.5 billion soccer fans, of course that’s football to non-Americans. And a little fun fact, the word soccer was actually invented by the British, not the Americans. But on a more serious note, anyone who makes money from the game of football will be in trouble during a pandemic.
Sure, a player like Lionel Messi who earns around $127 million a year won’t have to worry too much, but the industry itself will suffer and it employs lots of people. The NBA alone stands to lose $450 million from gate revenues and a further $200 million from non-ticket revenues. We can’t go through every sport in every country, but we can tell you that the global sports industry is estimated to total over $600 billion.
With hardly any sports being played, we are talking big losses. Even the ad industry could lose $26 billion because of games not being played, while the $450 billion from the global gambling market will also be hit hard. From sports we can segue to fitness. All over the world gyms will close, and the fitness industry is one that has been growing globally over the last few years. Gyms will lose many many millions during a prolonged pandemic.
Gyms and fitness classes is a $94 billion dollar industry in the U.S. alone, so as those places have closed their doors, you can only imagine the losses. The U.S. gym franchise, Planet Fitness, just reported that its stock lost 48% of its market value. You’ve also got manufacturing and shipping.
When ports are closed that’s bad for the shipping industries, and when factories are closed that’s bad for factory workers. The automobile industry employs millions worldwide, and it will have to start shutting its doors and in some cases laying people off.
This will happen, we know that for sure. Not only that, when people stay at home, energy consumption goes down, so the industries of oil and gas will also take a hit. The International Energy Agency said it predicts oil demand to be down 90,000 barrels a day in 2020, although before the pandemic it was estimating demand would go up to 800,000 barrels a day.
What about those people who make your clothes? Those in the garments industry? Well, those factories where they work will be closed and those workers in some cases will lose their jobs. Entire brands could go out of business. As for those places in poorer countries where a lot of clothing brands are manufactured, companies will start losing orders.
It was predicted that the U.S. retailers alone could lose $700 million from March 9 to April 20. And what about a person who works in a sweatshop, do you think they have a social welfare safety net? Many of them work hand to mouth, and so when their factories are closed they might literally have empty stomachs.
We should also say that some manufacturers will go bankrupt. These industries we’ve mentioned so far are easily the most affected by a pandemic and unfortunately many companies or entities will have to close down. Many, many people will lose their jobs, and even more unfortunately, a lot of those folks are in low-paying jobs and don’t have savings.
Big tech businesses that earn the mega-money will likely not go out of business, but during a pandemic a lot of their factories where devices are made will have to shut down. Companies in the business of making smartphones, games consoles, laptops, etc, will lose a lot of money.
In places like China, where a lot of that tech is made, there will be huge lay-offs. As for big techs’ office staff, they will likely just be told to work from home, so while they should be ok, the companies themselves will not be as productive and will lose money.
Smaller tech companies and startups might suffer more, but thankfully so much tech work can be done remotely. That’s certainly not the case with the construction industry. This will slow down, not only because of the risk of people spreading the virus on construction sites, but because supply chains will be halted. This is one of the world’s biggest industries, and just in the USA it employs around 7.6 million people.
But one industry we don’t often think about as a big earner and also often related to technology, is the convention industry. Some conventions are huge and employ the local workforce in the cities where they are held. All over the world, the cancellation of conventions will cost those local economies billions.
Just as an example, the World Mobile Congress last year generated $513 million for Barcelona, and it created 13,900 temporary jobs. That was cancelled this year, as were many, many other conventions. Another industry that you probably haven’t thought much about is the theme park industry, you know, those places where you stand in long lines next to hundreds of other people. Those places will have to close.
We estimate that one of the biggest theme park operators, the one called Disney, will lose around 500 million bucks a week during a pandemic. Around 200,000 Americans work at these places and they might get laid off. As we said earlier, if you live in a country that doesn’t have a social welfare system…well, those people are literally facing a crisis arguably worse than getting the virus that started the crisis.
Even in more developed nations where there are safety nets, some people will find themselves in debt or at least jobless. They likely won’t go without food to eat, but they will have to start all over again, so we don’t want to undermine their problems while talking about people in poorer countries.
We should state at the end that it all depends how bad the pandemic gets as to how these industries and the affected people will recover. There is no doubt that some industries and the companies in those industries will get back on their feet, but there is also no doubt that a global pandemic will leave a lot of scars.
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