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Business disruptions from social distancing
Miklós Koren1,2,3, Rita Pető2
1Central European University, Budapest, Hungary.
Plos One
|September 18, 2020
Summary
Social distancing measures significantly impacted the economy, with businesses relying on customer contact, such as retail and restaurants, experiencing the largest job losses. This study quantifies these economic costs.
Area of Science:
- Economics
- Epidemiology
- Sociology
Background:
- Social distancing is crucial for epidemic control but poses economic risks.
- Businesses dependent on face-to-face interactions are particularly vulnerable.
- Systematic evidence on industry-specific reliance on human interaction is lacking.
Purpose of the Study:
- To develop and apply theory-based measures of U.S. business reliance on human interaction.
- To identify industries and geographic locations most affected by social distancing.
- To quantify the economic impact of social distancing on employment.
Main Methods:
- Developed theory-based measures for business reliance on human interaction.
- Analyzed data by industry and geographic location.
- Correlated human interaction reliance with employment changes during the pandemic.
Main Results:
- Before the pandemic, 43 million U.S. workers were in occupations requiring significant face-to-face communication or close proximity.
- Employment losses were concentrated in sectors with high customer contact, including retail, hospitality, arts, and education.
- The findings align with the model's predictions regarding the economic impact of social distancing.
Conclusions:
- The study provides a quantifiable framework for assessing the economic costs of social distancing.
- Identifying vulnerable sectors aids in targeted economic support and policy-making.
- Understanding human interaction's role is key for economic resilience during public health crises.