The US economy will be affected by the coronavirus pandemic for almost a decade, according to the Congressional Budget Service (CBO).
The CBO predicts that the outbreak will reduce US economic output by 3% between this year and 2030, a loss of $ 7.9 trillion.
The warning comes as tens of millions of people lose their jobs due to locking measures.
The CBO is a federal agency in the US government that provides budgetary and economic information to Congress.
The historic downturn in America comes even after trillions of dollars have been pumped into the economy.
Image source WikimediaCoronavirus: 33.3 million Americans have filed for unemployment in the last six weeks
The CBO said most of the loss was caused by the sharp contraction in economic activity this year, which it had not anticipated in its latest ten-year report published in January.
CBO Director Philip Swagel wrote in response to a request from Senate Minority Leader Charles Schumer: “Business closures and social distancing measures are expected to limit consumer spending, while the recent decline in energy prices is expected to severely reduce US investment in the energy sector.”
“Recent legislation, according to the CBO, will partially mitigate the deterioration of economic conditions,” he added.
Since the viral pandemic hit the United States, the government and the Fed have provided trillions of dollars in support for the world’s largest economy.
Yet unemployment has risen to levels not seen since the Great Depression in the 1930s, with more than 40 million Americans out of work.
Unemployment in the United States reached 14.7% in April, and on June 5, the Department of Labor is expected to confirm that it reached 20% in May. In March, that figure was just 4.4 percent, up from a 50-year low from the previous month.
There is an ongoing debate in Congress on a new $ 3 trillion stimulus plan, as well as a proposal to renew several federal aid programs that would otherwise expire, including a temporary increase in unemployment benefits due to expire in July.