Consumer Spending After Crisis in the US

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Post-crisis Consumer Spending: 9/11 Crisis

The overall US economy was negatively affected by the attacks of September 11, 2001. Industries hit the hardest included the airline industry and the insurance industry. Globally, US trade partners were also affected, although for a short time. Two industries profited from the attacks: the oil and gas industry, where the affects were short-lived, and the defense and weaponry industry, where the profits lasted more than a decade.

Overall US Economy

  • The 9/11 attacks had a negative impact on the US economy as a whole, and worsened the 2001 recession, which was already underway at the time of the attacks.
  • The overall US economy contracted by 1.7% in the third quarter of 2001 (when the affects of the September 11th attacks occurred). This was, in part, due to the closing of the stock market for six days after the attacks, and then the sharp decrease in stock values when the market reopened. This resulted in an overall "$1.4 trillion in value was lost" during the first five days of trading following the closure.
  • The overall economy began to recover in the fourth quarter of 2001, seeing 1.1% growth. However, the stock market took 48 months (mid 2006) to recover from the low (occurring at the end of 2002) following 9/11.

Airline Industry

  • The airline industry was directly impacted by the 9/11 attacks, both due to a decrease in demand for airline travel as well as a decrease in the stock price. This was obviously due to the fact that airplanes were used as the weapon in the attacks.
  • On the stock market, after the attacks, there were major sell-offs of airline stock. For example, "American Airlines, Inc. (NYSE: AMR) stock dropped from a $29.70 per share close of September 11 to $18.00 per share close on September 17, a 39% decline. United Airlines, Inc. (NYSE: UAL) stock dropped from $30.82 per share close to $17.50 per share on the close on September 17, a 42% decline."
  • The US government "grounded the commercial fleet for three days that resulted in a 31.6 percent reduction in travel volume in September of 2001 compared to that same month in 2000 and generated massive industry losses." Additionally, the US Congress created enhanced security regulations for the industry, resulting in increased costs.
  • It took the airline industry three years (till July 2004) to "match and finally surpass the pre 9/11 levels" of passengers.
  • Airline stocks took much longer to recover, precisely 17 years: "NYSE Airline Index closed on September 10, 2001 at $116.97, re-opened September 17, 2011 at $69.85, and eventually bottomed just above $14 in March 2009. As of the market close on Wednesday, the index was at $118.12." This was obviously delayed due to the overall economic downturn of 2008.

Insurance Industry

  • The insurance industry was profoundly affected by the vast amount of claims resulting from the 9/11 attacks.
  • The claims totaled an estimated $40 billion, the most ever recorded, due to lost life and property.
  • While insurers had the financial ability to pay, many tried to absolve themselves of that responsibility by arguing that the attacks were "acts of war." Eventually, however, they decided this would not hold up in court.
  • The insurance industry then asked the federal government for assistance, an unprecedented move.
  • Most insurers were able to remain in business without major long term losses, mostly because they either left the terrorism coverage marketplace or provided very limited coverage. The federal government enacted the Terrorism Risk Insurance Act (TRIA) in 2002, which provided "temporary backstop for public and private sharing of insured losses from any future acts of terrorism in the United States" and calmed the insurance market.

Gas and Oil Market

  • Directly after the 9/11 attacks, gas and oil prices sharply increased.
  • This was due to concerns that the supply of gas and oil from the Middle East would be interrupted.
  • However, the prices quickly dropped back to normal levels within a week due to the fact that no interruption in supply occurred.

Defense and Weaponry Industry

  • The defense and weaponry industry profited from the 9/11 attacks as military spending increased for the War on Terror.
  • Directly after Sept 11, "President Bush requested the largest increase in defense spending in two decades." Specifically, companies like Boeing, Raytheon, Alliant Techsystems, Lockheed Martin and many more increased their production for the US government and homeland security. Stock increases were as follows: Raytheon (+37%), L-3 Communications (+35.8%), Alliant Techsystems (+23.5%), and Northrop Grumman (+21.2%), and more.
  • The increase in spending lasted over a decade; American spent $7 trillion on the Department of Defense in the decade following 9/11.

Global Economy

  • Directly after the 9/11 attacks, the economies of US trading partners, specifically Canada, Mexico and Japan, were negatively impacted as trade was disrupted.
  • However, the negative impacts were short-lived and minor.
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Post-crisis Consumer Spending: 2008 Recession

The Financial Crisis of 2007-2009, also known as the "Great Recession", had a major impact on global stock markets, with the U.S. DJIA falling to 6,547.05 on March 9, 2009, from a high of 14,164.53 on October 9, 2007, with a loss of more than 54%. Other stock markets also had a precipitous drop during the financial crisis. However, some equity markets have recovered while others have not. Below are some key details of consumer spending at the end of the recession.

The Financial Crisis of 2007-2009

  • The Great Recession in 2008 was so remarkable that the loss in capital and in wealth was observed globally in every major sector and industry.
  • The global economy went through a period of unparalleled financial instability in 2008–2009, coupled with the worst global economic collapse in trade in decades.
  • The collapse in U.S. home values combined with the free-fall of global stock markets produced a global recession.
  • President George W. Bush signed the Economic Stimulus Act into law in February 2008. This provided taxpayers with rebates ranging from $600 to $1,200, reduced taxes, and increased loan limits for federal home loan programs like Fannie Mae and Freddie Mac.
  • The government’s goal was that the Economic Stimulus Act would be a quick way to jump-start economic growth.

Consumer Spending Across Different Markets

  • Stocks, bonds, cash equivalent or money market instruments, real estate, commodities, investments, and other financial derivatives declined sharply. Even high-valued metals, as well as municipal bonds, were not safe from this crisis.
  • Emerging market currency gains declined more than 50% while U.S. stocks dropped by 37%.
  • Economic growth decelerated while food and energy prices accelerated, particularly in budding and developing countries where food is a major commodity.
  • The global economic output fell from 3% in 2008 to 0.6% in 2009. Unemployment remained at lengthier and higher levels, with the U.S. remaining consistent at above 7.5%. The global system did not stabilize until 2009.
  • By the last quarter of 2008, as the recession deepened, consumers cut spending by over $200 billion from the previous year to just under $9.1 trillion, with lower purchases of goods, especially vehicles.
  • Apple, Amazon, and Netflix grew during the 2008 recession. Today, all three stocks are listed in the 30 most popular stocks among hedge funds.
  • The fast-food industry grew remarkably during the 2008 recession as it was inexpensive and many people couldn’t afford anything else.
  • Job losses were significant, it took much longer than earlier recessions to get back to the level of payroll employment.
  • Long-term unemployment reached considerably higher levels and lingered much longer as it took six years from the end of the recession to reach a 2.6% peak rate. Whereas, average hourly earnings of employees grew copiously and balanced out to 2.2% annually through 2017.

Research Strategy

To find the information above, our research team used data from statistical surveys, fact-based research sites and articles from reputable online business, economic and financial journals, annual reports and statements from company executives. Due to the wide effect of the 2008 recession, the information summarized in our research was based on consumer spending across different markets in general, and not focused only on specific markets. Some factors are also considered such as the consumers' job losses and unemployment which has highly affected their capability to spend.

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Post-crisis Consumer Spending: H1N1 Pandemic

Arriving on the heels of the global economic crisis in 2008, the 2009-2010 H1N1 pandemic impacted most countries across the globe, but its negative impact on consumer spending appeared to be temporary. Luxury goods, such as furniture and recreational vehicles, along with automobiles, clothing, financial services, communication services, and healthcare (including pharmaceuticals and biotech), rebounded quickly after the pandemic, and showed solid gains in the years following the H1N1 crisis. Consumer packaged goods and housing, which stayed largely flat during the H1N1 crisis, rebounded with more moderate growth after the H1N1 crisis. Industries in which consumer spending lagged after the H1N1 crisis include gasoline, the hospitality industry (particularly in Europe), and transportation.

H1N1 Pandemic: Timing

  • The H1N1 virus, known also as Swine Flu, was declared a global health emergency by the World Health Organization (WHO) on April 25, 2009, and a global pandemic on June 11, 2009. At the time H1N1 was declared a pandemic, 70 countries globally had observed cases of H1N1.
  • The virus was receding in the southern hemisphere by July 2009, and had mostly disappeared by November 2009.
  • In the United States, the virus peaked in October 2009.
  • On August 10, 2010, the WHO declared the H1N1 global pandemic officially over.
  • The global impact of the virus was less severe than previous pandemics, and in retrospect is often considered a mild global public health crisis. Global mortality estimates ranging from .001 to .007 percent.

United States Consumer Spending

  • According to global market research firm, Nielsen, at the height of the pandemic in the US in 2009, predictable spending patterns were occurring in terms of consumer goods, with consumers spending more in treatment or prevention categories. Categories such as cleaning products, cough and cold remedies, orange juice, tea, soup, and hand sanitizers all experienced year over year growth from October 2008 to October 2009, driven by the H1N1 pandemic.
  • Consumers were also spending more per trip and making more frequent trips.
  • Given its association with the virus ('swine flu'), spending on pork products declined 6% in 2009.
  • According to personal spending information provided by the Bureau of Economic Analysis (BEA), The United States observed a relatively fast recovery in consumer spending after the H1N1 pandemic.
  • Overall personal expenditures decreased 1.3% in 2009 (compared to 2008), but by Quarter 1 2010, expenditures had increased .6% versus the previous quarter, and were up 1.7% in 2010 (compared to 2009), 1.9% in 2011 (compared to 2010), and 1.5% in 2012 (compared to 2011).
  • These consumer spending trends were observed across goods and services, durables and non-durables.
  • After a 6.1% spending decline in 2009 (versus 2008), durables spending increased 5.6% in 2010 and 5.1% in 2011.
  • In 2010, furniture expenditures increased 5.6%, recreational goods increased 7.8%, and motor vehicles increased 3.8%.
  • Spend on clothing drove the rebound in non-durables spending, increasing 4.8% in 2010 and 3.3% in 2011.
  • Financial services declined 3.4% in 2009 (which could be due in part to the 2008 financial crisis), but experienced a strong consumer spending rebound in 2010 (+2.3%) and 2011 (+2.7%)
  • Non-durables showed increases of a lesser magnitude. After a 1.7% decrease in 2009, spending increased 1.6% in 2010 and .9% in 2011.
  • Food and beverage spending increased 1.5% in 2010 and .2% in 2011, after declining .7% in 2009.
  • Services overall stayed largely flat following the H1N1 pandemic, increasing 1.1% in 2009, 1.6% in 2010, and .8% in 2011. Services did not increase over 2% until 2014 (+2.4%), with travel spend driving much of the increase at that point.
  • Consumer spend in the housing sector also showed some small increases during this time frame, increasing 1.1% in 2009, 1.2% in 2010, and 1.3% in 2011.
  • Consumer gas and energy expenditures grew slightly during the pandemic and recovered very slowly, lagging far behind other sectors. Gas expenditures did not demonstrate an increase after H1N1 until 2014, increasing .1% in 2014 and 4.7% in 2015. This lag in spending may not be exclusively traced to H1N1, as retail gasoline prices peaked at $3.735/gallon in June 2014 to $2.208/gallon in 2015.
  • Some hesitation with respect to transportation was observed during and after H1N1, with this market declining substantially in 2009 (-7.1%), rebounding slightly in 2010 (+.3%), and somewhat more (+4.3%) in 2011.


While Europe did see a slight uptick in consumer spending in 2010 (+.8%), following a -1.3% change in consumer spend in the midst of the pandemic in 2009, their spending recovery was mild. Consumer spending increased only .8% in 2010 and .04% in 2011. In 2012, spending had declined slightly to -.57%.
  • Markets that recovered faster after H1N1 include the communications and health sectors.
  • Markets slower to recover include clothing, housing, utilities, restaurants and hotels, and education, with consumer spending largely remaining flat for several years following the pandemic.
  • Laggards include alcoholic beverages, tobacco, and narcotics, which showed a continual decline in consumer expenditures, starting in 2008, continuing through the H1N1 pandemic, and maintaining a downward trend until 2018. Transportation also lagged many other industries, with a turnaround in consumer spending not observed until 2014.
  • The visual below demonstrates changes in household expenditures across the European Union.
  • Overall, Latin America experienced a mild impact to consumer spending during and after the H1N1 pandemic, with expenditures decreasing only .31% in 2009, and rebounding substantially in 2010 (+5.52%) and 2011 (+5.02%).
  • Mexico experienced negative impacts to tourism and, temporarily, the pork industry, due to H1N1 ('swine flu'), which was closely associated with pork. By the end of 2009, Mexico had a pork deficit of $27MM and had experienced $2.8 billion in tourism losses.

South Asia

  • Spending growth in South Asia during the 2009 H1N1 pandemic slowed slightly, from 4.36% to 3.98%. Spending rebounded in 2010 (+6.08%) and 2011 (7.03%).


  • By early 2010, the end of the H1N1 pandemic in most countries, the pharmaceutical industry experienced increased sales associated with vaccines and drugs.
  • While the United States pharmaceutical industry did not benefit to the extent that European pharmaceutical and biotech companies benefited, the United States' health care market associated with flu tests and hospitals did benefit from increased consumer spending.

Research Strategy

We began our research by identifying the time frame within which H1N1 was officially classified by the World Health Organization (WHO) as a global pandemic, which was June 2009 to August 2010. Using reputable consumer spending sources, including the BEA, Macrotrends, and Eurostat, we then looked at consumer spending trends in total, starting in 2008, through 2012 and beyond, to understand how annual consumer spending trended prior to H1N1, during H1N1, and following H1N1. This analysis provided insight into when consumer spending appeared to recover in regions around the world. We then drilled down, where possible, into specific market segment consumer spending to understand which markets recovered quickly, which didn't recover quickly, and to what extent consumer spending recovered in specific markets. We were able to develop this more granular level of detail in the United States and Europe. We complimented our analysis with publications and articles from experts, such as the Centers for Disease Control, in the US, and research papers which provided more color on consumer spending in specific markets.

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Post-crisis Consumer Spending: SARS Pandemic

Post-Crisis Consumer Spending: SARS Pandemic

Hotel Market

Airline Market

  • SARS impacted business and international travel significantly resulting in Asia-Pacific airlines losing 8% of annual RPKs and $6 billion of revenues, but after the SARS pandemic, monthly international passenger traffic returned to its pre-crisis level within nine months
  • During the SARS pandemic, Cathay Pacific Airlines fell by more than 20% between March-May 2003 before recovering completely from that loss within 2 months.
  • According to CAPA Centre for Aviation — In 2004, less than a year after the effect of SARS on international airline travel, "Beijing Capital Airport rebounded with a 43% increase in 2004, and this picture was repeated to a greater or lesser extent around the region."

Retail Market

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Economic Indicators 2008 Recession

Economic stimulating events during the 2008 Great Recession include (1) government bailouts to financial institutions, (2) increased accountability for financial institutions, and (3) massive stimulus packages. These stimulating events helped lower unemployment rates, stabilize financial institutions, increase expendable income and ultimately led to a boost in consumer confidence and spending.

1. In 2008, National Governments Spent Billions to Stabilize Financial Institutions

  • By September 2008, it was clear that financial institutions around the world were nearing ruin. To avoid the economic disaster that would follow the collapse of financial institutions, the Bank of England spent 850 billion pounds, the European Central bank spent 500 billion dollars, and the United States spent 700 billion dollars to bail out their banks and other essential industries.
  • For example, in 2008 Barack Obama announced the Troubled Asset Relief Program (TARP), modeled after a similar program in the United Kingdom. TARP provided funds that the US Treasury used to purchase stock and mortgage-backed securities (MBS) from failing banks, and thus save them from collapsing.
  • TARP funds also went to bailing out auto companies (like Chrysler and GM) that provide millions of jobs to Americans.
  • By stabilizing financial institutions and saving jobs in the auto industry, TARP helped calm widespread panic. This led to a rise in consumer spending, especially for small businesses and homeowners.

2. In 2009, increased Transparency and "Stress Tests" Led to a Boost in Confidence in Financial Institutions

  • As part of the TARP program, the government required banks to perform "stress tests." The tests ensure that banks maintain enough capital to withstand hypothetical economic downturns.
  • As banks began to turn in positive results to stress tests, the public began to regain their confidence in the stability of the banking system. Banks began to offer more home loans and small business loans to consumers, which led to an increase in consumer spending.

3. National Stimulus Packages Helped Increase Confidence in Employment Prospects and Kickstart Consumer Growth

  • In the middle of the Great Recession, Japan, China, the European Union, and the United States enacted massive stimulus packages. These governments turned to fiscal stimulus, because in late 2008 and the first quarter of 2009, economic growth was plummeting at an alarming rate.
  • For example, in the second fiscal quarter of 2009 the Obama administration passed the American Recovery and Reinvestment Act (ARRA) to boost employment and increase consumer confidence.
  • In the first quarter of 2009, the United States economy fell by -6.7 percent. In the second quarter (after the ARRA passed) the economy fell by only 0.7 percent. In the first three months of 2009 there was an average of 780,000 jobs lost each month, but by the end of 2009 that number decreased to 138,000.
  • The ARRA included $260 billion in direct relief to Americans, $54 billion to support small businesses, and $83 billion to create public works projects/jobs. As a result of major fiscal stimulus packages like ARRA, national government transfers to households increased tremendously between the final quarter of 2007 and the final quarter of 2009.
  • These measures helped many consumers regain their confidence in their employment prospects and put money in their pockets, which helped spur consumer spending. After bottoming out in 2008-2009, consumption growth recovered between late 2009 to 2010.
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Economic Indicators 9/11 Crisis

Shortly after the 9/11 crisis, the US government commissioned several actions to lessen damage to the US economy, indicate stability, and stimulate consumer spending. Some of the most significant actions taken by the US government to safeguard and increase consumer spending in response to the 9/11 crisis are detailed below.

Monetary Response

  • The Federal Reserve within hours of the 9/11 attack issued a communication stating that it was still in service and available to meet all financial needs. The quick response by the Federal Reserve System allayed fears in the minds of consumers and discouraged them from running to the banks to withdraw their deposits, easing liquidity pressure on the banking system.
  • For three days after the attack, the Federal Reserve injected $100 billion into the financial system, cushioning liquidity by as much as $300 billion immediately after the 9/11 attack. These actions ensured that local consumer spending levels and patterns remained unchanged and uninfluenced by the crisis.
  • In October 2001, the Federal Reserve further reduced the federal funds rate from 3.0 percent to 2.5 percent. The move was a direct response to the 9/11 attack to stimulate business and household spending which slowed as a result of the crisis, according to a statement issued by the Federal Reserve.
  • To further shore up the value of the dollar, stimulate further consumer spending, and reduce panic sell-offs in international markets, the Federal Reserve signed new currency swap agreements with the European Central Bank, the Bank of Canada, and the Bank of England which further injected $90 billion into the financial system.

Economic Stimulus Packages

  • In times of crisis, governments around the world rely on deliberate actions to stimulate economic growth and consumer spending. A few days after the 9/11 attack, Congress passed the "Emergency Supplemental Appropriations Act for Recovery from and Response to Terrorist Attacks." Through this Act, the United States appropriated a total of $40 billion to be used as emergency funds to hasten the recovery of the affected areas.
  • In March 2002, Congress again approved another economic stimulus package titled "Job Creation and Worker Assistance Act of 2002" to further stimulate growth within the economy. The Act made provisions for the following reliefs in direct response to the 9/11 crisis: expanded authority for New York City to issue up to $8 billion of tax-exempt private-activity bonds, $950 million worth of tax reductions for new businesses to encourage new capital investment and a 30% bonus depreciation for affected properties.
  • In August 2002, the US government created a third supplemental stimulus package for individuals and businesses that were directly affected by the attacks. The Act made provisions for the following: a $1.8 billion grant to enhance public transportation systems in Manhattan, a $167 million grant to reconstruct the West Side Highway, a $783 million grant to assist businesses, and a $2.7 billion fund to provide mortgage or rent assistance to individuals directly affected by the attack and revitalize the economy.

Direct Government Intervention

  • The aftermath of the 9/11 attack led to the virtual collapse of the aviation industry. The amount of loss resulting from the destruction of planes, buildings, and properties crippled the industry's finances. This was further compounded by the heightened reluctance of Americans to travel by air after the attack.
  • Congress decided to intervene and save the industry from collapse by passing the "Air Transportation Safety and System Stabilization Act." The Act made provisions for the following: financial aids and subsidies totaling $5 billion, a $10 billion loan facility, and a federal commitment to spend $3 billion on airline safety and security. The direct intervention saved the industry from collapsing and sustained consumer spending on aviation travels.
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Travel Recovery after H1N1 Pandemic

Some factors that indicate increased trust in the travel industry after the H1N1 pandemic are advancements in early detection, the efficiency of communication with the public, expanding the knowledge regarding locations of affected locations, and the capability of prevention and eradication of the H1N1 virus.


  • With developments of rapid detection tests, the ability to monitor current viral outbreaks, and quick communication through different agencies, it is faster than ever to stop any infected persons from traveling to areas that are not infected.
  • Temperature measurements before boarding airplanes or cruise ships helped with gaining the global public's trust. These could depend on these measures to keep them safe after the H1N1 epidemic.


  • With access to news updates, local community communications, and updates through international sites like the CDC, the public could gain a more significant idea of the threat locally and domestically.
  • This allowed the public to make more informed decisions on where to travel after the pandemic was deemed to be dissolved.


  • The marketing departments for tourist locations had to provide solutions to help with assuaging the publics' fears of possibly coming in contact with the H1N1 virus. Coming up with short-term flexibility and all-inclusive packages, along with the ability to cancel at no cost options, restored the destination's image and increased tourism flow.
  • This boosted public confidence in these locations and removed hesitation for booking flights and reservations for travel domestically or internationally.


  • With the quick development of the H1N1 vaccination getting the pandemic under control was an essential factor in dissolving the epidemic. Promoting flu prevention measures helped in stopping the spread of H1N1 after the vaccinations were available to the public.
  • Updating the public on how to keep these measures on a day to day basis. With these measures in place, the fears of possible death or injury from this virus decreased more significantly to that of a healthy person.
  • Due to the lowered risks, the public anxiety was reduced and banned travel system from stopping the spread was no longer in place, allowing for travel to continue.


  • In 2013, the number of domestic trips was 10,040, and international flights were 691. In 2005 the most significant number of trips domestically was 14,269 and internationally was 1,081.
  • The estimated amount of trips before the H1N1 epidemic in the U.S. range from 230 million in 2006 to 198 million in 2011 for domestic flights and from 17.2 million in 2007 to 14.9 million visits in 2009 for international flights.


The research team visited the resource gallery for the Centers for Disease Control and Prevention in search of information regarding the H1N1 pandemic to outline the necessities of a decrease in travel. The CDC website provided the research team with a timeline of the pandemic, which enables a wide-scope view of the H1N1 timeline. The U.S. Bureau of Labor provided the research team with both domestic and international travel statistics. CNN provided information regarding what each country did to stop the spread of the H1N1 pandemic. The World Health Organization provided an overview of local and state officials of how to stop the infodemic of fear as it applied to the growing numbers of affected people. Based on the given facts, the research team then made an informed decision on the overall length of time it took for the travel industry to recover in regard to travel spending was approximately 3 years.
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Travel Recovery after SARS Pandemic

The 2003 SARS pandemic critically damaged the global tourism industry. A few factors involved in the recovery of the travel industry and the trust of travelers included the World Health Organization's lift of travel bans, Tourism Ministry promotions after the pandemic, and trade relationships between individual governments such as the US and China.

WHO Organization and Travel Bans

  • The SARS pandemic decreased international travel severely. In 2003, outbound trips declined 8.6 million trips or 1.2% from the year before.
  • The World Health Organization plays a major factor in influencing travel trends during pandemics. During the SARS pandemic, the WHO issued a travel ban in many Asian countries including China and Taiwan.
  • WHO working with individual governments, lifted its outbound travel ban from Asian counties and its inbound travel into Asian counties. It can be logically reasoned, that the act of a world-recognized organization telling the public that traveling is safe will increase travel and consumer spending.
  • After lifting the travel ban, WHO created a list of rules for countries to follow when it comes to safe travel after a pandemic. These rules were set to increase confidence in public order to recover the travel industry. Indicating that an increase in caution during a recovery period creates a sense of trust in the traveler and consumer.
  • A few examples of the rules created are: pre-departure and arrival scans for travelers, developing an emergency SARS hotline for international travelers and international meetings to deploy further countermeasures to the virus.

Tourism Ministry Promotions After a Pandemic

Economic Partnerships and Travel Trends

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Travel Recovery after Zika Virus

WHOs announcement of the end of the Zika public health emergency, mosquito-control measures and decreases in Zika virus transmission, and the easing of travel restrictions appear to be the factors that have led to renewed or increased trust in the global travel industry after the Zika virus outbreak. The global travel industry as a whole was not as affected by the 2015-2016 Zika outbreak as people might think. There are statistics that indicate continued growth since 2015, and that suggest recovery in less than a year’s time.

WHOs Announcement of End of Public Health Emergency

  • WHOs declaration that the Zika public health emergency is over appears to be the key factor that has encouraged consumers to travel again after the Zika outbreak. It can be recalled that WHO put an end to the Zika public health emergency on November 18, 2016, more than nine months after the emergency status was raised.
  • On said day, the WHO announced that the Zika situation is no longer a public health emergency of international concern, but clarified that it is not downplaying the importance of the virus. It cautioned that the virus is still an important health challenge that everyone should take seriously.
  • As defined in the International Health Regulations (IHR), a public health emergency of international concern (PHEIC) is an extraordinary event that represents a public health risk and may call for a coordinated international response.
  • The lifting of the PHEIC status is a clear indication that the gravity of the situation has changed. The positive response to this news is apparent in how the number of arrivals from Brazil in the United States had increased between 2016 and 2017. Brazil was one of the countries widely affected by the Zika virus during the 2015-2016 outbreak.
  • The number of arrivals dropped by -2.0% in 2015 and -22.6% in 2016. In 2017, after the lifting of the public health emergency status, the number of arrivals increased by 10.8%.

Mosquito-Control Measures and Decreases in Zika Virus Transmission

  • Halfway through 2017, it was reported that the Zika outbreak in Brazil, the Caribbean, and Florida had subsided.
  • Mosquito-control measures have been instrumental in stopping the spread of the virus. In continental United States, for example, it was reported that such measures have resulted in zero local Zika virus transmission since 2018.
  • News of these mosquito-control measures and decreases in Zika virus transmission has likely contributed to the recovery of the travel industry. Travelers, of course, would only consider destinations that are reported to be safe and free from disease transmission or outbreak.
  • These mosquito-control measures and decreases in Zika virus transmission were likely part of the reason behind the quick turnaround in arrivals and the continued growth of the global travel industry. As earlier mentioned, the number of arrivals from Brazil in the United States grew by -22.6% in 2016 and then by +10.8% in 2017.

Easing of Travel Restrictions

  • The lifting of travel bans or warnings was at play as well. People can only go to places they are legally allowed to travel to.
  • In the case of the Zika outbreak, the last travel warning against Southern Florida was lifted in June 2017.
  • This change in travel advice has likely contributed to the positive growth or recovery in the number of arrivals from Brazil in the United States in 2017.
  • Governments are easing restrictions to travel to Latin America and the Caribbean.

Time to Recovery

  • It appears that the global travel industry was able to quickly recover from the Zika outbreak and that the global travel industry as a whole was not as affected by the outbreak as people might think. As can be seen in a recent report of the World Travel & Tourism Council, the global travel and tourism industry has experienced continued growth since 2015.
  • This is despite projections in 2017 that the global tourism sector will lose around $6.5 billion to $9 billion between 2015 and 2017 as a result of the Zika outbreak.
  • From $2.4 trillion in 2015, the direct contribution of travel and tourism to global GDP reached $2.5 trillion in 2016 and $2.6 trillion in 2017.
  • The quick recovery may have something to do with the fact that Latin America and the Caribbean, the widely affected regions, are very popular tourist destinations, and only a specific segment of the population, women or couples undergoing, planning, or expecting pregnancy, is advised to stay away from countries or regions with Zika transmission.
  • Also, couples avoiding the Zika virus have plenty of other places to travel to. Bermuda and Hawaii, for example, have noticed a spike in tourist arrivals because they have no history of Zika transmission.
  • If the number of arrivals from Brazil in the United States is any indication, the travel industry was able to recover in less than a year’s time. As mentioned earlier, growth in the number of arrivals from Brazil in the United States switched from -22.6% in 2016 to +10.8% in 2017.

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From Part 02
  • "An asset class is a grouping of investments that exhibit similar characteristics and are subject to the same laws and regulations. Asset classes are made up of instruments which often behave similarly to one another in the marketplace."
  • "With the recession, disposable income first rose and then, starting in the third quarter of 2008, fell precipitously. The falloff in disposable income was delayed because government transfers to households increased by 18.6% from the last quarter of 2007 to the last quarter of 2009. "
  • "IMF Data - Access to Macroeconomic & Financial Data"
  • "The year before ARRA, the George W. Bush administration sent out stimulus checks to battle the 2008 recession. It spent $120 billion in fiscal years 2008 and 2009.1 It rebated taxes on the first $6,000 of income for individuals or the first $12,000 of income for couples. "
  • "Hedge funds are supposed to be nimble players who take advantage of changes and volatility in the markets. Last quarter we listed hedge funds’ top 30 stock picks for the second quarter of 2019."
  • "There are some businesses that actually flourish during recessions because budget conscious consumers start paying attention to the prices and flock into discount stores or businesses that enable them to complete their DIY projects at a steep discount to services offered elsewhere."
  • "The United States’ longest, and by most measures worst, economic recession since the Great Depression began in December 2007 and ended in June 2009. The Great Recession cast a long shadow over the economic expansion that followed, however, and labor market conditions improved steadily but slowly for several years before the economy began closing in on full employment between 2015 and 2017."
  • "The Bush Economic Stimulus Package didn't have the impact it should have. A 2008 survey found that only 20% of those who received checks spent them. Another 32% put the money into savings. The rest use the checks to pay off debt."
From Part 05
From Part 06
From Part 07
  • ""CDC does not know the exact number of people who have been sick and affected by influenza because influenza is not a reportable disease in most areas of the United States. Therefore, these numbers are estimated using a mathematical model, based on observed rates of laboratory-confirmed influenza-associated hospitalizations.""