In this unprecedented time, everyone is concerned about the COVID-19 pandemic.

The virus, unfortunately, has already spread to over 200 countries, with more than 4 million people infected and 280,000 deaths.

But a far more severe and long-lasting ripple effect of the COVID-19 pandemic will be on the economy.

There have been warnings already about the negative COVID-19 impact on industries. We may not be able to completely grasp the enormity of this yet, but the signs are already there. Consider this:

• Aviation is the first industry been hit by this crisis. All the airlines have cancelled hundreds of flights. The CAPA Center for Aviation has warned that most airlines will unfortunately go bankrupt by mid-2020 as the revenues dry up.
• The tourism and hospitality industry is next in line to be hit. The tourism industry accounts for 10% of the world’s GDP and has effectively become non-existent overnight. The World Travel and Tourism Council has given warning of up to 50 million job losses worldwide due to the COVID-19 pandemic.
• Oil prices have crashed due to decline in global demand. The low prices threaten to make the American shale industry unsustainable and hurt entire economies of the major oil producing countries.
• In the retail sector, most brick-and-mortar retail chains and stores are experiencing drastic reduction in demand. Online retail, however, is experiencing a huge surge in demand, as people can’t come out to shop and instead order online.
• Luxury goods, consumer and white goods, autos, and apparels, all face a severe demand crunch due to prolonged lockdowns and loss of income for common people. Healthcare and medical care products however are seeing an unprecedented growth in demand.
• All sports tournaments and activities have also ground to a halt. Numerous major sporting events have been either canceled or postponed for months or even to the next year.
• The entertainment industry– movies, television, radio, music, animation, print, and gaming–is undergoing an upheaval as well. While all offline modes of entertainment– movie halls, malls, concerts, and others, have virtually shut down; the online entertainment industry is seeing a surge in demand as people spend more time trying to entertain them while at home. However, the media, both print and digital, are badly hit as advertisements dry up.
• The education sector is impacted too, even if in the short term. Most schools, colleges, hostels, and other institutions are closed down for short-to-medium term until the situation normalizes.
• Agriculture may also be badly affected. As the stores remain shut and supply chains are disrupted, vast amounts of perishable food supplies may be destroyed before reaching the consumers.
• Industrial output is shrinking at a fast pace as factories stagger shifts in an attempt to allow workers to maintain social distance from each other. Downturn in global demand is not helping either.

You might have noticed ‘no mention’ of the impact of COVID-19 on IT industry, the banking sector, or the insurance sector so far. Will they be unaffected? Sure, IT sector companies can implement work from home, and the world cannot operate without money via the work of the IT industry. But these sectors may just be waiting for the next wave of the bad news in coming months and years.

IT companies depend upon other industries for their projects. With so much disruption, many potential and existing customers in the IT sector will be forced to re-prioritize their budgets and investments in the IT sector may be diverted into the core businesses.

Debt is essential to the financial health of all businesses, including IT companies. As many sectors experience severe blows to their top and bottom lines, numerous companies will falter on their debt payments, resulting in rise in non-performing assets (NPAs). This will put enormous burden on the overall health of the global banking sector.

Insurance companies are staring at huge numbers of health and life claims filed by COVID-19 victims. We may see large payouts from insurance companies, causing strain on their balance sheets as well.

So, all these sectors, including IT companies, getting badly impacted globally, all at the same time, will create a vicious cycle of sorts, which will prolong the impact even further. Worst of all, the purchasing capacity of a vast majority of people across the globe will go down, as companies struggle to pay the salaries to their employees or worse, keep them on the roll.

Governments all over the world are already pumping billions of dollars into the fight against the corona virus. This will stretch their fiscal health. This could be the worst global recession we have seen in our lifetime. But all is not as bleak as it appears. As they say, every cloud, however dark has a silver lining. And there is no silver lining without a cloud.

Technology and innovation will come to the rescue. Businesses will re-imagine new models and use technology to become more reliable and cost-effective. Entire new industries will emerge creating new jobs and bringing people back them on their feet. Amazon, for example, is hiring 100,000 new workers to keep pace with the unprecedented growth in online shopping. Similarly, online education and entertainment are set for rapid growth as well.

People will find ways to get their lives back on track, while keeping themselves and others safe amid COVID-19, and the IT industry, along with other industries will strive to do the same.

After all, it’s the people at the center of all business and economics, not the other way around.