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Economic effects of the coronavirus crisis on GDP and employment in Spain and the Valencian Community

Uncertainty about how long the health crisis will last makes it difficult to accurately estimate the overall economic cost. However, according to sectoral research carried out by the Ivie,  if the pandemic is brought under control soon and the economy returns to normal within a month, GDP in the Valencian Community will shrink by 3.2% to 5.3% (rates similar to those expected for Spain). Considering a  GDP growth forecast prior to the pandemic of 1.6%, those percentages reflect negative growth of 1.6% for the baseline scenario and 3.7% for the worst-case scenario. As for employment, this is estimated to drop by between 3.7% and 5.4% (in the baseline and worst-case scenarios, respectively) in the Valencian Community (slightly more than in Spain in general). If the return to normal is delayed to two months,  annual GDP for the Valencian economy in 2020 will shrink by 4.8% and 9% in the baseline and worst-case scenarios, respectively.