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Wuhan Virus Has Cost People Their Jobs

For every worker idled by the virus, there's a ripple effect to the economy. Stores, restaurants, Walt Disney World (Disney stock has crashed, even with a mild recovery, if you haven't noticed), cruise ships, airlines, and every business under the sun in our service economy will be harmed. Any many people will, sadly, lose their jobs.

SXSW (South by Southwest), the annual arts, music and technology festival held in Austin, Texas, has laid off at least 50 employees–about one third of its staff–after the festival had to be cancelled due to Wuhan Coronavirus fears.

After Facebook, Twitter, Netflix, BMI, Apple and others pulled out because of travel restrictions, the festival had no choice but to scratch this year. The final blow was Austin Mayor Steve Adler declaring a local disaster, which effectively scrubbed any possible alternative.

“We are devastated to share this news with you,” the festival said in a statement. ‘“The show must go on’ is in our DNA, and this is the first time in 34 years that the March event will not take place. We are now working through the ramifications of this unprecedented situation.”

Austin’s South by Southwest Festival Canceled Due to Coronavirus, The Wall Street Journal, March 6, 2020

That’s at least 50 people who are now unemployed due to the spread of COVID-19, which has now crossed the 1,000 mark in the U.S.

It’s not the only example–and unfortunately there are many more to come as the virus takes its toll on our economy, starting with the trade show circuit.

Organizers in Asia, Europe and North America have canceled or postponed at least 440 trade shows and exhibitions in response to the coronavirus this year, including scores during the past week, according to German expo trade magazine m+a. The impact was reverberating across everyone from conference sponsors and exhibitors to airport shopkeepers and restaurateurs to hotel clerks and bartenders dependent on tips.

Coronavirus Is Devastating the Conference Circuit, The Wall Street Journal, March 4, 2020

In the travel industry, Delta Air Lines, which previously had announced a hiring binge, has now announced a hiring freeze due to the virus. In a company statement, Delta CEO Ed Bastian said, “As the virus has spread, we have seen a decline in demand across all entities, and we are taking decisive action to also protect Delta’s financial position. As a result, we have made the difficult, but necessary decision to immediately reduce capacity and are implementing cost reductions and cash flow initiatives across the organization.”

Delta and other airlines are (some drastically) reducing capacity, which means less hours for pilots and flight attendants (who get paid by the flight hour). They are deferring maintenance and capital expenses. This will ripple down to already-struggling Boeing.

Some media events are switching from live audiences to–well, nothing. The debate to be held this Sunday between Joe Biden and Bernie Sanders will be just two old men in an empty studio filled with media and technical staff. No live audience.

Sporting events are being impacted, some might be held with no spectators. If you’re selling drinks at the stadium, this bodes poorly for you.

Los Angeles County officials also have discussed the possibility of banning spectatorsfrom attending sporting events in Southern California in an attempt to slow the spread of the coronavirus. The BNP Paribas Open at Indian Wells, one of the top tennis tournaments in the world, was canceled Sunday over coronavirus concerns.

How the coronavirus is affecting sports leagues and events, Los Angeles Times, March 10, 2020

This is just the beginning. Every company, as I’ve noted before, is being forced to make difficult choices and construct pandemic plans. If the virus gets into the local community, and into a factory, do you shut down? Most small companies would rather not think about it, but it will happen to some.

For every worker idled by the virus, there’s a ripple effect to the economy. Stores, restaurants, Walt Disney World (Disney stock has crashed, even with a mild recovery, if you haven’t noticed), cruise ships, airlines, and every business under the sun in our service economy will be harmed. Any many people will, sadly, lose their jobs.

The 50 or so who no longer work for SXSW are among the first casualties of many.

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