COVID-19 has been loosening its grip on the economy of the United States for quite a while now.
Despite the fact that COVID numbers hit a historic high in January, its impacts on the economic health of the country were bleak, as job growth and retail spending remained strong.
Many states have also started eliminating mask mandates across the country, including blue states, which had been reluctant to do so earlier in the pandemic.
It could be perceived as a Democratic effort to successfully measure people’s sentiments before elections, as most Americans have indicated in the latest surveys that they want to live with the virus now, as they seem fed up with the pandemic.
Stagnated economic recovery worries the Biden administration
Even with the minimal effect of the virus on the economy, this time, the economy is still unable to grow as it was supposed to do.
This is due to the fact that the work chain disrupted across the country in the beginning and midst of the pandemic has been slow to recover.
Inflation is rising at an unparalleled pace, with the probability of its increase still mounting if Russia attacks Ukraine. Thus viruses may not be the decisive factor in the economy these days.
However, it has done enough damage to the same economy, making its growth slower. This was already anticipated, for the very fact that bringing back normalcy demands that every sector is opened at the same time because each sector is dependent on the other for the proper functioning of the economy.
However, while industries reopen, they are unable to operate at their full capacity due to the shortage of manpower amid the great resignation crisis, which intensified before the latest wave of the omicron virus.
The Omicron variant was supposed to be a blessing in disguise for America, but the administration did not cash the opportunity fully.
This is also translated into poor public perception of the economy, as Americans feel gloomier about the economic condition these days compared to the high point of the pandemic.
These indicators can also turn against the Biden administration ahead of the 2022 midterm elections.
By far, the president has failed to convince most people that his economic policies are working and generating results beyond the most optimistic projections even.
The primary problem for the overall slow economic recovery is the level of uncertainty prevailing among the economic sector these days. Uncertainty is the biggest enemy of the economic growth of any country, and the same is happening in the United States as well.
The Fed has already announced to increase the interest rate in the current fiscal year, which means that investment can be rolled back at many fronts, which will further delay the reopening of the economy fully.
Vaccine Inequity has worsened American economic recovery
Vaccine inequity which was born under the discriminatory policies of the Biden administration also played its role in lingering the opening of the economy fully.
When the omicron variant hit the shores of the United States, it once again alarmed investors whether or not they should put their money into the business.
The fact that these variants are produced due to the unequal distribution of the economy in the first place depicts that the economic recovery could have been fastened had the vaccines been distributed equally and fairly.
Supply chain disturbance remained one of the most disturbing issues for the administration. The computer chips shortage is adding fuel to the fire, which is even promising to stagnate the economy beyond the virus as well.
Many economists believe that the economy can be helped by controlling the pandemic and reducing the prevailing uncertainty in the market.
If the administration somehow assures investors that a new variant would not be as deadly as the previous ones, they can take the initiative to put the economy back on track.
However, the problem is that the administration is also not sure where the pandemic will go, as the poor vaccination regimes of less developed countries continue disturbing the economic progression of the developed nations as well.
Eli is a Political Data Scientist with over thirty years of experience in Data Engineering, Analytics, and Digital Marketing. Eli uses his expertise to give the latest information and distinctive analysis on US Political News, US Foreign Affairs, Human Rights, and Racial Justice equipping readers with the inequivalent knowledge.