KNOXVILLE, Tenn. (WVLT) — As more people contract coronavirus overseas; the outbreak could infect the United States economy.
Two Iowans are receiving testing for novel coronavirus after they returned from China. This is according to the Iowa Dept. of Public Health. Officials say the two are under voluntary home confinement. (MGN Image)
China is the second largest economy in the world, behind the United States. Several factories there are closed, which is slowing down production for some of the goods needed in the U.S. and East Tennessee.
“Businesses here in the United States that require them for manufacturing cars or aircrafts and things of that nature,” Dr. Reeves Johnson, an assistant professor of economics at Maryville College, said. “This is important. This could potentially impact you.”
Even products in your pocket could see a shortage, like Apple’s iPhone, which is made in China.
However, Johnson said the full impact of coronavirus on the U.S. economy isn’t known yet. He said if the virus is contained within the next few weeks, the economy won’t see much change.
Reduction in air travel is also slowing down the time goods make it to the U.S. If the parts aren’t here, workers won’t have anything to assemble.
DENSO, in Maryville, said in a statement, “As a global entity, we continue to work with our international team to monitor and assess how the outbreak could impact DENSO operations. Employee safety is paramount, so we have advised all employees to postpone travel to China.”
If the slow down creates a shortage, some companies might be forced to raise prices. So far that has not become an issue.
Many economists compare this outbreak to SARS back in 2003. However, Johnson said China’s economy is now eight times larger.
For Johnson, it creates a real-world lesson for his classroom. “I could do a chalk and talk lecture and draw graphs on the blackboard. But I can see it in the students faces — they want to see how this is relevant to the world they live in.”
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