Pandemic Toolkit - Impact on the Australian economy

Impact on the Australian economy

A pandemic could deliver a "shock" to the economy, with immediate demand and supply side effects, as well as longer-term supply side effects.³

The general slowdown in economic activity would reduce gross domestic product (GDP). Business confidence would be dented, the supply of labour would be restricted, supply chains would be strained as transportation systems were disrupted, and arrears and default rates on consumer and business debt would probably rise. It seems likely that the stock market would initially fall and rebound later.¹²

Estimates of the economic impact vary widely. A pandemic could cause a serious recession in the Australian economy. The following is a sampling of predictions:

The World Bank has predicted a pandemic could cost the global economy $800 billion a year
A medium level outbreak of a pandemic in Australia is estimated to result in a 6.8% reduction is Australia’s gross domestic product in the short term¹⁵
The Australian treasury has estimated that a global pandemic with 40,000 deaths in Australia would result in a 9.3% reduction in GDP.¹³
The Asian development bank have estimated the economic impact of a pandemic in 2006 for Asia would be $114 Billion USD if a mild pandemic occurs¹⁶
The Lowy institute estimates a severe influenza pandemic would reduce Australian GDP by 5.6%¹⁴

Professor Robert Marks (Australian graduate school of management) emphasizes that now is the time for organisations to go through a thorough exercise in business continuity planning and to examine how their operations will be affected. ¹⁷

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