EconWatch (July 19, 2020)
As the U.S. government scrambles to recover from the current economic crisis, many are wondering when the U.S. economy will return to its pre-COVID-19 state.
Experts from Deloitte predict three scenarios:
Baseline: COVID-19 continues to hinder economic activity for the remainder of 2020. Thus, the U.S. economy will not see significant improvements until mid-2021. Even then, the GDP growth rate will not fully recover until the end of 2023 and the employment rate until 2025.
Fast Bounce Back: The reopening in May is successful, COVID-19 is quickly brought under control, there is limited damage to small businesses, and companies resume business. As a result, economic activity will return to its pre-COVID state in late 2022.
No End in Sight: The reopening proves premature, states reluctantly limit economic activity, and COVID-19 cases continue to increase. Consequently, the economy will only begin its recovery in late 2021. By 2025, unemployment rates will remain in double digits and the country's GDP will be 10 percent lower than it would have been if the COVID-19-induced events did not occur.
While it is too early to judge, experts are leaning towards the Baseline scenario due to the continued increase in COVID-19 cases. Read more here.