Economists and epidemiologists work to find a balance amid pandemic
A closed sign hangs on the door of Stilheart Distillery in Minneapolis amid the pandemic. (FOX 9)
MINNEAPOLIS (FOX 9) - Economists and state health leaders are working together in Minnesota to find a balance between public safety and keeping the economy going.
The governor's stay-at-home order is having a big impact on both small and large businesses. Since the middle of last month, more than 409,000 people have filed applications in Minnesota for unemployment. That number represents more than 13 percent of the state's workforce.
“You cannot destroy every institution in America because of an epidemic,” said Christopher Phelan, Department of Economics chair at the University of Minnesota
“Not doing anything would be catastrophic for the health of the nation and for the economy as well,” said Ryan Demmer, an associate professor of epidemiology at the University of Minnesota.
So how do we find a way to preserve the health of the nation while also preserving our economy? That is what epidemiologists and economists are working together to figure out.
“They’re starting to work on models that integrate the epidemiological infection models with different economic models that could help us maybe come up with mathematical tools that would essentially say here are the types of economic encounters that are good for the economy on a whole, but carry very low risk in terms of spreading the virus,” said Demmer.
Leaders in both fields are working to find an answer to that during this shutdown. Phelan says part of the puzzle could be looking at what types of businesses and services would be safe to bring back.
"We pretty soon need to start thinking about, just for the sake of not destroying every economic institution we have in the nation, what is it that we can do to open up that are low-transmission activities?” said Phelan.
“We can get through this in creative and innovate ways that allow us to maximize both the health of the nation and diminish the adverse economic impacts, but without question if we do nothing and we just let up and relax all these social distancing measures, I think it would be a total catastrophe for the economy as well as the health of the nation,” said Demmer.
Experts say if we don’t use this time wisely, it could become catastrophic for our country.
“The only benefit I see of a shutdown is to put ourselves in a position that we can handle this later,” said Phelan.
That would be a position where hospitals are not overrun, where the curve is flattening, but where people are going back to work and where our economy can come back.
“The economist in me simply wants to emphasize that the costs we’re paying for this kind of shutdown per week are enormous,” said Phelan. “So we better see the benefits being enormous as well.”
“It’s going to buy us time allow us to collect data and make good decisions,” said Demmer.
As things change day after day, their goal remains the same - finding that balance as we work to again find normalcy.