Coronavirus: Health effects of a COVID-19 recession 'could be worse than the pandemic'

The full effect of the coronavirus pandemic on people's long-term and mental health will not be felt for two years, experts have predicted.

While the immediate impact of the COVID-19 outbreak will be devastating, the Institute for Fiscal Studies (IFS) is warning that the economic fallout could have "persistent negative health effects".

It says hundreds of thousands of people could develop chronic health conditions and that unemployment and other financial concerns may cause mental health problems.

In a new briefing, it notes a recent debate on "whether the adverse health effects of a recession may be greater than the increased morbidity and mortality within the pandemic itself".

The IFS points to the additional 900,000 people of working age who suffered from a chronic health condition, including mental health, after the 2008 recession.

It said the "government policy has a key role" to make sure we don't see a similar impact after this crisis.

Heidi Karjalainen, a research economist at the IFS, said that "many of those who are most exposed to the economic shutdown - such as low income families, especially those with young children - are also most vulnerable to long-term effects on both physical and mental health."

The IFS cites research published in March by the Centre for Economic Policy Research that estimates that a 1% fall in employment could lead to around a 2% increase in the prevalence of chronic illness.

And it found that COVID-19 will "disproportionately" impact those from less affluent backgrounds.

Ordinarily emergency hospital admissions are 1.7 times higher among those from the most deprived areas, the research found.

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The unprecedented pressure this crisis is putting on the NHS, leading to cancelled operations and disruptions to non-coronavirus emergency care, will therefore "exacerbate existing geographical and socioeconomic health inequalities".

Sectors like retail, catering, transport, leisure services, have been largely or entirely shut down during lockdown. Low earners are seven times more likely to work in these sectors, according to a separate study

One third of the bottom 10% of earners work in the worst-hit sectors, compared to 5% of those in the top 10%.

Director of ResPublica think tank, Phillip Blond, fears Covid-19 will have a long-term impact on inequality and worsen regional imbalance.

He said: "Place and poverty are intrinsically linked in this country. If you look at the level of debt the government are taking on because of coronavirus, we have to ask does this mean austerity is the de facto agenda after the emergency's over?"

The IFS found that richer households may be boosting their savings as a result of the crisis.

It said 55% of spending in lower income households will go on necessities, compared with 39% in higher income households, meaning that poorer households will be less resilient to any fall in income.

Richer households also spend far more proportionally on "banned" activities like eating out and holidays, and may therefore be effectively forced to make additional savings during the crisis.