5 Industries most affected by Coronavirus (COVID-19)

1. Travel and Tourism 
2. Technology Companies
3. Fintech Sector
4. Retail Industry
5. Food Service Industry

COVID-19 (Coronavirus) has been designated as a global pandemic by the WHO (World Health Organization) and has a devastating impact on the world economy including supply chain disruption, economic slowdown, trade, logistics, and commodities. Life is gradually grinding to a halt. Whilst all sectors have been affected by the novel coronavirus deadly disease, some bear the impact of the downturn much more than others. One of the global leaders in industry market research named IBISWorld is strongly watching the brunt of COVID-19 on verticals around the globe.

Fast Facts-Impact Updates

The novel coronavirus outbreak has held up economic action, threatening to push the globe into a downturn, and various industries are feeling its impact. Mentioned below an updated reports based on relevant information and study surrounding the COVID-19 pandemic outburst.

Global Shares Take a Slap

The big change in stock markets, where shares in firms are bought and sold, can impact several investments Dow Jones Industrial Average, Nikkei, and The FTSE have all seen huge downfalls ever since the pandemic start on 31st December. The Dow and the FTSE at first saw their huge declines since 1987.

• GDP is presently taking a stern beating. But, the size of the collision in distinct portions of the globe will depend basically on how long the current economic disruption proceeds. We foresee a plunge in GDP growth in 2020 compared to the pre-crisis base case range from 1.9 to 7.1 % points.

• Airline, tour and travel, and retail (excluding FMCG) will be thrashed strongly on both fronts because of coronavirus outbreak, putting them in the upper right-hand quadrant of our coronavirus impact.

Let’s check out the effect of COVID-2019 pandemic on five industries:

1. Travel and Tourism 

• The tourism and travel industry is sternly affected by the COVID-19 outbreak. With the novel coronavirus being a deadly disease, people are avoiding journeys to distinct countries and cities, which has depressingly impacted the tourism industry and has affected the travel benefits of the affected parts of the globe. 

• According to IATA (The International Air Transport Association), airline share prices have dropped almost 25% since the outbreak burst, “some 21 % points greater than the drop off that happened at the same point during the SARS (Severe acute respiratory syndrome) crisis of 2003.” India’s top airline, IndiGo, saw its stock price drop by 16 percent, as said by an HSBC Broking statement, while SpiceJet’s was losing by 31%.

• The U.S. airlines asked for over $50 billion in federal assistance because of the dramatic decrease in traveler traffic.

• At the end of 2020, airlines can have an 11-19% loss in international passenger revenues, according to IATA (The International Air Transport Association).

However, the global industry could see dropping in passenger revenue of almost 20% under the widespread scenario, which could result in approximately $113 billion in lost income.

2. Technology Companies

• Coronavirus has a mixed effect on technology businesses. Since tech companies have closed their stores and organizations, confining their executives to travel to the pretentious areas, it has unfavorably affected the supply chains as well. For example, manufacturers who have been affected by the coronavirus are failing to make prompt delivery, thus impacting numerous tech companies. 

• On the flip side, IT companies are realizing the rewards of outsourcing, specifically. Remote working has been given preference and thus functions like software development and software maintenance are slightest affected by the COVID-19. Manufacture of smartphones, smartwatches, and video game consoles are all foreseen to drop by over 10%. 

• Graphics card manufacturer Nvidia lowered its future earnings for the first quarter of 2020 by $100 million, saying the deadly disease is disrupting its supply chain. The well-known company Apple could lose as much as $67 billion because of an iPhone shortage. 

• Indian IT major companies such as TCS, HCL Technologies, and Wipro have followed suit as well. Technology giants with great exposure to China have also alerted investors about dropping sales.

On the flip side, IT companies are realizing the advantages of outsourcing. Remote working has been given the first choice amid the novel coronavirus and thus functions like software development and maintenance are least affected by the COVID-19.

[Fig- COVID-19 Impact on Tech Industry (Source-Statista)]

3. Fintech Firms

• The coronavirus increase is proven to be the biggest threat to the financial markets as well. If we look at the short period effect, we could see folks are making safe investments in the market. This means there are lower investments in the stock market, a harmful bang on VC funding of existing and new fintech companies. 

• The Fintech segment has experienced a fall in transactions and business at all levels. Since people have self-isolated for protecting themselves against the novel coronavirus spread, they are spending less than normal, which leads to a low transaction rate. In effect, cryptocurrencies like Ethereum, Bitcoin, etc. have experienced a major plunge amid coronavirus effect. 

4. Retail Industry

• The U.S. retail industry has been shattered by the coronavirus pandemic, and several stores have been closed their doors. Apple has closed all stores outside of the country like China until March 27, and other large retailers in sporting goods stores, fashion, and tech have made the same announcements, with more coming in each day. 

• Nike, Urban Outfitters, and other firms have announced plans to pay staff at least in the short term for lost earnings. This is positive news for the workers, many of whom are amongst the low-paid workers, but it will, of course, mean the companies' bottom lines will take a hit. 

• One Jefferies analyst stated CNBC, "With stores accounting for 75% of sales for most retailers, we anticipate massive EPS [earnings per share] declines for 1Q, particularly as most retailers appear to be paying employees during the 2-week closures."

• On the converse, digital commerce companies are trying to make the most of this situation. Nonetheless, thriving in such an outburst is still challenging employment for E-commerce companies.

5. Food Service Industry

• Between full- and limited-service restaurants, buffets, pubs, caterers, and more, well uncountable Indians are employed in the foodservice industry. Metropolitan cities have ordered restaurants or hotels to only offer takeout options as a preventative measure. This could jeopardize wages for workers; most of them are hourly workers. Chinese and US restaurants have been chiefly hard hit over unfounded disgrace related to the outburst.

• As stated by Nation's Restaurant News that in Seattle, restaurants were likely to lose 20-25% of sales in the first week of March. By March 16, many states had imposed restrictions on eateries hosting dine-in clients. On the weekend of mid-March, America's major cities restaurants reported a drop in the occupancy of wherever from 30%-64%. 

• Research firm Challenger, Gray & Christmas report that over 600 foodservice sector job cuts were straight related to the virulent disease and those 7.4 million jobs in the industry could either be cut or sternly impacted.