A woman wearing a mask in New York City. Financial experts believe that the virus-suppression effect of wearing face masks helps to preserve economic activity. Jeenah Moon/Getty Images

Wearing masks could prevent a 5% loss in GDP, Goldman Sachs says

Janet Nguyen Jun 30, 2020
A woman wearing a mask in New York City. Financial experts believe that the virus-suppression effect of wearing face masks helps to preserve economic activity. Jeenah Moon/Getty Images

A national mandate for Americans to wear face masks could save almost 5% of gross domestic product, according to an analysis from Goldman Sachs. 

“We find that face masks are associated with significantly better coronavirus outcomes,” the investment bank said in a report distributed to clients. “A face mask mandate could potentially substitute for lockdowns that would otherwise subtract nearly 5% from GDP.”

In April, the Commerce Department announced that the country’s GDP fell 4.8% in the first quarter, its biggest quarterly drop since the Great Recession. 

Janet Nguyen/Marketplace

Right now, 20 states and the District of Columbia require residents to wear masks either in all public places where social distancing isn’t possible, most public indoor spaces or in businesses, according to the organization #Masks4All. Other states have more limited mask requirements.

The Goldman Sachs research says a national mandate could raise the number of people who wear masks by 15 percentage points and cut the daily growth rate of confirmed coronavirus cases by 1 percentage point to 0.6%.

The report’s authors noted that the U.S. is among the less restrictive countries when it comes to face mask mandates.

The mere act of wearing a mask in the country has become a political issue, with Democrats more likely to say they wear masks than Republicans and President Donald Trump refusing to don a mask in public. Videos have also captured customers who have been confronted over not wearing masks.

The report estimated that statewide mask mandates increase the number of people who “always” or “frequently” wear masks by 25 percentage points in the 30 days after the order was signed.

It also found that cumulative COVID-19 cases grow 17.3% per week without a mask mandate, but only 7.3% with such an order.

These findings are in line with other studies that have shown the effectiveness of policies that call for mask wearing amid the pandemic. Mandates in 15 states, along with the District of Columbia, may have helped prevent between 230,000 and 450,000 cases of COVID-19 by May 22, according to a study from Health Affairs. Another study found that “countries with cultural norms or government policies supporting mask-wearing” had lower death rates.

However, while the Goldman Sachs report focuses on the importance of masks specifically and the economic side of the question, experts point to a range of measures needed to combat the public health threat that is COVID-19.

Lynn Goldman, dean of the Milken Institute School of Public Health at George Washington University, told Marketplace it will also take widespread testing and social distancing until we have a vaccine.

COVID-19 Economy FAQs

What’s the latest on the extra COVID-19 unemployment benefits?

As of now, those $600-a-week payments will stop at the end of July. For many, unemployment payments have been a lifeline, but one that is about to end, if nothing changes. The debate over whether or not to extend these benefits continues among lawmakers.

With a spike in the number of COVID-19 cases, are restaurants and bars shutting back down?

The latest jobs report shows that 4.8 million Americans went back to work in June. More than 30% of those job gains were from bars and restaurants. But those industries are in trouble again. For example, because of the steep rise in COVID-19 cases in Texas, Gov. Greg Abbott, a Republican, increased restrictions on restaurant capacities and closed bars. It’s created a logistical nightmare.

Which businesses got Paycheck Protection Program loans?

The numbers are in — well, at least in part. The federal government has released the names of companies that received loans of $150,000 or more through the Paycheck Protection Program.

Some of the companies people are surprised got loans include Kanye West’s fashion line, Yeezy, TGI Fridays and P.F. Chang’s. The companies you might not recognize, particularly some smaller businesses, were able to hire back staff or partially reopen thanks to the loans.

You can find answers to more questions on unemployment benefits and COVID-19 here.

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