Even industries unaffected by lockdowns will feel coronavirus impact
New Finance Ministry report investigates coronavirus impact on industries on outskirts of pandemic
By JERUSALEM POST STAFFJerusalem's Mamilla mall is seen nearly empty amid Israel's third coronavirus lockdown, on January 4, 2021.(photo credit: MARC ISRAEL SELLEM/THE JERUSALEM POST)
The direct impact of the coronavirus pandemic and ensuing regulations and lockdowns on many industries may have a significant impact on industries not directly impacted by measures taken in response to the pandemic, according to a new report by the Finance Ministry.The report recommends that, in light of these findings, policies designed to aid businesses in the wake of the pandemic must also aid businesses in industries not directly impacted by regulations.The report measures the impact caused by the connection between industries that is a result of services purchased from businesses in other industries.The report paid special attention to the connection of the air travel, hospitality and leisure industries to other industries, because these industries were severely impacted by the pandemic and have some of the most long standing restrictions in place against their operation.The report found that for every one job impacted in the air travel industry, 1.74 jobs are impacted in other industries that profit indirectly from air travel. Some of the industries most severely impacted by air travel include building security and maintenance, travel agencies and tour providers.For every job in hospitality, the industry indirectly supports 0.5 jobs in other industries through the purchase of services. The industry most significantly impacted by the hospitality industry is building security and maintenance services. Laundry services and food services are also greatly impacted by hospitality.The report found that the purchase of services by businesses in the air travel, hospitality and leisure industries represent spending equivalent to 26% of those employed in tour and travel agencies, 18% of those employees in food services and 14% of those employed in video, television and film production and editing.Similarly, the purchase of landscaping and gardening services by the hospitality, leisure and air travel industries together represents 12% of those employed in the gardening industry.Some of the indirect impact on businesses impacted by downsizing in directly affected industries will be recognizable almost immediately, while other impacts will likely be seen in the longer term, according to the report. Impacts on the hospitality industry will likely have an immediately visible impact on advertising businesses, but the impact on services such as accounting will likely be seen in the long run, as businesses are forced to close or downsize and no longer require accounting services.Estimates of the impact of each industry on other industries were made under restrictive assumptions that affect their accuracy and should be seen as indicators that may help shape policy to aid businesses rather than exact measurements.
