A singular event has economists asking the same questions as everyone else: how far is there to fall – and can we ever get back?

Stagnation in services sector and winter drop in construction activity hit GDP growth

With lockdown likely to be extended, Treasury can draw on billions in extra funds to support cashflow

Nearly half of all jobs in Africa could be lost without urgent action, says charity

Resolution Foundation analysts estimate cost of UK’s wage subsidy scheme

International trade body predicts commerce could shrink up to 32% and warns against 30s-style protectionism

Report warns 80% of firms face a highly uncertain future if stores close for two monthsThe coronavirus pandemic has plunged the $2.5tn (£2tn) global fashion industry into crisis with a “significant number” of firms expected to go bust in the next 18 months, putting millions of jobs at risk.Global fashion sales are predicted to fall by up to 30% in 2020 and the luxury end of the market will be even harder hit, with sales slumping by up to 40%, according to a bleak report by the Business of Fashion (BoF) and consultants McKinsey.Related: Primark announces wage fund for garment workers Continue reading...

Short-term collapse in global output likely to rival or exceed any recession of the last 150 yearsWith each passing day, the 2008 global financial crisis increasingly looks like a mere dry run for today’s economic catastrophe. The short-term collapse in global output now under way already seems likely to rival or exceed that of any recession in the last 150 years.Even with all-out efforts by central banks and fiscal authorities to soften the blow, asset markets in advanced economies have cratered and capital has been pouring out of emerging markets at a breathtaking pace. A deep economic slump and financial crisis are unavoidable. The key questions now are how bad the recession will be and how long it will last.Related: World must combat looming debt meltdown in developing countries | Joseph StiglitzThe US public-health response has been catastrophic, owing to a combination of incompetence and neglect at many levels of governance, including the highest. If things continue the way they are, the death toll in the New York City area alone could rival that of northern Italy. Continue reading...

Dutch officials and British economist to use guide to help city thrive in balance with planet

As car sales plunge by almost half lenders offer repayment breaks or waive interest to halt ‘handbacks’Fears are growing of a crisis in the UK’s £75bn car loan market, where 6.5m vehicles have been financed through leasing deals with monthly payments that are already proving unaffordable for some laid-off as a result of the coronavirus.The Finance and Leasing Association (FLA), which represents the credit arms of the car manufacturers as well as the banks, said: “It’s early days in terms of quantifying the impact on arrears, but the number of forbearance requests has grown significantly in recent weeks.”Related: Sub-prime cars: are car loans driving us towards the next financial crash? Continue reading...

British Chambers of Commerce reports firms at a ‘cliff edge’ as cash runs out with with only 1% getting government funds

UN Labour body expects 6.7% of working hours to be wiped out globally in second quarter

Flight from stock markets helps Treasury complete first part of scheme to bolster spending with at least £45bn extra this month

Shares have bounced back but it’s too soon to call the bottom for prices in the Covid-19 pandemicHave we seen the bottom for stock markets? It is tempting to believe so after two days of fast action as investors have responded to the welcome sight of flatter coronavirus curves in Italy, Spain and Germany.Some of the gains in individual stocks – those that had fallen the furthest – have been stunning. Speedy boarders could have made a 27% return in 48 hours by buying shares in easyJet first thing on Monday morning. In the same short period, Rolls-Royce, the engine-maker, gained 24%. Like easyJet, it was able to unveil a self-help strategy involving more borrowing.Related: FTSE shrugs off dire UK data as markets sense easing of Covid-19 crisis Continue reading...

If international community wants to avoid wave of Covid-19 defaults it needs to start rescue planAs it spread from one country to another, the coronavirus paid no attention to national frontiers or “big, beautiful” border walls. Nor were the ensuing economic effects contained. As has been obvious since the outset, the Covid-19 pandemic is a global problem that demands a global solution.In the world’s advanced economies, compassion should be sufficient motivation to support a multilateral response. But global action is also a matter of self-interest. As long as the pandemic is still raging anywhere, it will pose a threat – both epidemiological and economic – everywhere.Related: Now the world faces two pandemics – one medical, one financial | Robert Shiller Continue reading...

Letter calls for $8bn emergency fund to bolster health systems in world’s poorer countriesA group of 165 global leaders has called for immediate and coordinated international action to tackle the twin health and economic emergencies caused by the Covid-19 pandemic.Past and present politicians – including three former UK prime ministers – joined academics and civil society representatives to warn the G20 that the virus will return unless urgent action is taken to bolster health systems in poor countries of Africa and Latin America. Continue reading...

The company’s spending cuts bolster the government message that bailouts are a last resort

‘Coronabond’ proposal for debt sharing threatens to derail meeting of countries still haunted by fallout from 2008

Dow, German Dax and FTSE all rise amid signs that severity of the crisis may be easing

Rolling coverage of business, economics and markets as stock markets gain on hopes coronavirus lockdowns are slowing disease’s spread

Jamie Dimon singles out US structural problems, and warns inadequacy of emergency planning will be laid bare

One member state has become a dictatorship as others spiral into debt. Germany must lead through the coronavirus crisis

When millions face an uncertain employment future, a federal jobs guarantee program could turn the page on a dark chapter of our nation’s historyLast week, more than six million people applied for unemployment, the largest jump in unemployment claims in our country’s history. The Federal Reserve estimates that the Covid-19 pandemic could lead to 47 million Americans losing their jobs in the weeks to come. With little hope of being re-hired, these workers will struggle to stay healthy, feed their children, and pay rent on the meager, one-time $1,200 check authorized by the most recent federal stimulus package.At the same time, we face the consequences of starving our public infrastructure. Our cities are deficient in resources and underprepared for a pandemic epidemiologists have been warning government officials would be coming. Despite claims that ours is the best healthcare system in the world, our hospitals and nursing homes do not have sufficient masks, gloves, protective gear, flu tests, ventilators, hand sanitizer, or disinfectant wipes to protect either their own staff or their patients. We need workers to produce these essential products.No factory should be standing idle through a healthcare crisis. Failing to use these resources during a deadly pandemic is unacceptableCassandra Robertson, PhD, is a postdoctoral fellow at the Cornell Population Center, where she researches economic mobility and social policy.Holly Wood, PhD, is an independent scholar, writer and activist. Continue reading...

We are told by everyone from the United Nations to Donald Trump that the US is a ‘developed’ economy. The statistics suggest otherwiseWhen Susan Finley developed flu-like symptoms, she didn’t go to the doctor because she was frightened about the cost. Finley’s grandparents later found her dead in her apartment. She was 53.Finley did not die as a result of Covid-19. She died in 2016 as a result of America’s healthcare system – a system that led her to avoid treatment for the common flu in order to avoid debt. It is that same system that is currently creaking under the pressure of a pandemic that experts warned was coming but governments failed to prepare for. It is a system that does not qualify for the term “developed”. Continue reading...

Low earners seven times more likely to work in sectors worst hit by shutdown, study finds

A new economics paper suggests a red-amber-green solution to safely ease us out of coronavirus restrictions

Boris Johnson has shown a woeful lack of responsibility as the Covid-19 pandemic has escalated

Economic hardship is blighting some more quickly than others

Coronavirus has changed Britain’s social and political orthodoxies. But not every crisis results in a revolutionAs a classical scholar, our prime minister will be all too aware of some uncanny parallels between the onset of coronavirus and the plague that beset Athens in 430BC.The immortal historian Thucydides wrote: “At the beginning the doctors were quite incapable of treating the disease because of their ignorance of the right methods … In fact, mortality among the doctors was the highest of all since they came more frequently in contact with the sick.”The end of capitalism? I doubt it. The Tories suddenly becoming fully paid-up Keynesians? For how long, I wonder Continue reading...

The new ‘Cbils’ scheme is much improved. But many of its shortcomings could have been identified at the startBanks are wicked and Rishi Sunak walks on water. That, at least, was the narrative that prevailed until the end of last week. The dashing new chancellor, the cabinet star of the coronavirus moment, had assembled the Treasury’s armoury to provide lending to British businesses on unprecedented scale. It was only the damn banks that were stopping the cash reaching intended recipients.This storyline now looks wrong. Sunak and the Treasury’s “further action”, announced on Thursday night to support struggling British firms, was not a mere tweak. It was a sweeping redesign of a lending scheme that had glaring flaws.Some banks were asking for guarantees at launch; some weren’t. No wonder borrowers were angry Continue reading...

Chaos in response to Covid-19 is no surprise. Nor is the unscrupulous operators’ pursuit of profit and political advantage

As mayor of Tehran I have seen lives lost as a result of medical shortages. This is no time for vindictive politics• Coronavirus latest updates

Live coverage as American payrolls data shows big rise in unemployment, after composite PMI data shows UK business activity sunk to a record low in March following the Covid-19 lockdown

The coronavirus crisis is causing catastrophic levels of joblessness but the damage will not only be economic

Blame for the crash | MPs’ votes on pay rises for nurses and themselves | Beards and PPE for doctors | Feast or Famine? | Key worker Steve BellI agree with Larry Elliott (Blaming Labour won’t work this time – the Tories will have to own this crisis, 3 April) that the true villains of the 2008 financial crash were never punished, and that their misdeeds indirectly resulted in our being unprepared for the current pandemic. I suggest we all open our windows this evening and boo for the bankers.

Coronavirus fuelling faster collapse than 1930s, warns ex-Bank of England rate-setter

Although UK data lags behind the US, the evidence is mounting – coronavirus makes 2008 look trivial

A million people, myself included, have turned to UC in Britain’s lockdown. Now we will see the ordeals claimants face• Coronavirus latest updates

Data from online bank Revolut shows convenience stores boom and decline in cash use

Shadow chancellor says the cost need to be borne by those with the broadest shoulders

Decade-long record of growth halted as US lost 701,000 jobs but full impact of coronavirus will be reflected in next month’s report

Though it has not been officially declared, we are already in a deep recession that will get deeper before it gets betterThis week the US labor department released data on initial unemployment insurance (UI) claims, showing that UI claims jumped from 211,000 in the week ending 7 March 2020 6.6 million in the week ending 28 March. This is more than a 3,000% increase in three weeks. In fact, every state in the country reported its highest initial claims ever either last week or the week before. Over the last two weeks alone, nearly 10 million workers have filed unemployment insurance claims. And given that health insurance is tied to work for so many, we estimate that 3.5 million workers likely also lost their health insurance in the last two weeks. The grief and suffering behind these numbers is incomprehensible. Though it has not been officially declared, we are certainly already in a deep recession that will get deeper before it gets better.Related: As the numbers of dead and unemployed grow, Trump looks and sounds smaller | Richard WolffeHeidi Shierholz is director of policy at the Economic Policy Institute and served as chief economist at the US Department of Labor Continue reading...

There is no right or wrong way for governments to deal with the financial impact of coronavirus - only trade-offs

Conservatives laid post-2008 damage at the opposition’s door. This time they will be held accountable for how prepared Britain wasThroughout history, pandemics have often had profound economic effects. The most famous of all, the Black Death of the mid-14th century, wiped out between a third and two-fifths of the population of western Europe. The labour shortages that followed are credited with hastening the end of the feudal system.Covid-19 is nowhere near as deadly as the Black Death, but the shock it has dealt to an already vulnerable global economy has been immense. Perhaps inevitably, there is talk of life never being the same again. Continue reading...

Rolling coverage of the latest economic and financial news as oil prices jump by more than 30% and the US jobless report reveals scale of coronavirus damage

US sees second major unemployment rise as millions working in retail, restaurants, and travel lose jobsMore than 6.65 million people filed for unemployment benefits in the US last week, the latest official figures to highlight the devastating economic impact of the Covid-19 pandemic on the American economy.The federal labor department announced that a new record number of people sought benefits after losing their jobs in the week ending 27 March as long lines formed at unemployment offices, phone lines jammed and websites collapsed under the weight of claims across the US.Related: What US unemployment benefits can I get during the coronavirus? Your payment options explained Continue reading...

Change is coming to the UK, when this crisis is over. Unless progressives have a plan, they will lose out like they did in 2008It can take a grave national crisis to fire a flare, revealing the ugliest features of a society defined by injustices that the wealthy and powerful would rather forget. It took the second world war to achieve what the Jarrow hunger marches of the 1930s struggled for: to illustrate the national shame that millions of people who were called upon to make grand sacrifices were afflicted by poverty and malnourishment. As child evacuees with hungry bellies arrived on the doorsteps of the relatively well-to-do, the other Britain could no longer be ignored. “A revolutionary moment in the world’s history is a time for revolutions, not for patching,” declared William Beveridge as he laid the foundations for the postwar welfare state. Unprecedented state direction of the economy meant that Labour’s ambitious programme of nationalisation no longer seemed quite so scary. The old order perished in the rubble of war-ravaged Britain.Coronavirus has done two things: it has magnified existing social crises and has proved that the government can act decisively when the will is there. Millions are only ever one pay packet away from destitution; the self-employed and gig economy workers lack security and basic rights; private tenants are at the mercy of their landlords; our welfare state is woefully inadequate; and many designated “key workers” are desperately undervalued and badly paid. Who, in good faith, can now blind themselves to these grim truths?Related: Young people have paid enough – spare them from footing the coronavirus bill | Gaby Hinsliff Continue reading...

Some self-employed workers and high earners at risk despite subsidy plan, warn thinktanks

Coronavirus fears are feeding financial and economic anxiety and vice versa. Breaking the cycle will not be easy, but it is possible

Low Pay Commission says cost of fighting coronavirus pandemic endangers flagship pledge to raise national living wage to £10.50 an hourThe government has been warned it could be forced to abandon targets for ending low pay in Britain by raising the legal minimum wage, as the economic costs of Covid-19 mount.The Low Pay Commission, the independent body which advises ministers on legal wage floors, said the government target to increase the national living wage to two-thirds of average earnings by 2024 could be in danger.The national living wage is the minimum wage that must be paid to workers in the UK, and it came into effect on 1 April 2016. Continue reading...