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US Economy Loses $12 Trillion to COVID Lockdowns, Mandatory Business Closures Cited as Top Reason

U.S. GDP fell during the pandemic due to COVID-19 lockdowns and resulted in trillions of dollars in losses in these past years, a consequence mainly driven by mandatory business closure policies, according to a study by researchers from the University of Southern California (USC).

By the end of 2022, the pandemic had cut $12.2 trillion from U.S. GDP, the study published in Economic Modelling journal estimates. Researchers expect total losses to hit $14 trillion by the end of 2023. The study blamed involuntary business closures as the “leading cause” for the massive decline in America’s GDP during this period.

“I’m still amazed at how powerful a negative impact COVID is projected to have on the U.S. economy compared to previous man-made and natural disasters,” said study co-author Adam Rose, a research professor at the USC Price School and senior research fellow at the USC Center for Risk and Economic Analysis of Threats and Emergencies (CREATE), according to a news release on Jan. 25.

“COVID’s impact on GDP is estimated to be nearly 100 times more than the previous largest disaster of the 21st century—the September 11, 2001, World Trade Center attacks.”

While the Trump administration’s stimulus spending eased economic losses during the pandemic, the Biden administration’s $1.9 trillion spending did not have such an effect, according to the study.

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