"Whether it's corporate bankruptcies or personal, this is unprecedented."
That's the read from Edward Altman, PhD, professor emeritus of finance at New York University’s Stern School of Business, according to Bloomberg. Dr. Altman created the widely used Altman-Z-Score model, which evaluates the likelihood of bankruptcy for companies globally.
Dr. Altman expects bankruptcies related to COVID-19 shutdowns to set records in the next year. He told Bloomberg he expects record-breaking dollar amounts due to much higher levels of outstanding debt now compared to any prior economic downturn.
Other experts say retail is especially fragile, given how mandatory store closures and widespread unemployment are fueling a drop in customer traffic and spending, particularly at retailers deemed nonessential. In no other financial crisis have stores closed overnight, one expert pointed out, and one analysis shows foot traffic at all U.S. retailers dropped as much as 98 percent in the last week of March, according to Business Insider.
The implications of retail bankruptcies matter to hospitals and health systems' patient populations, given that retail is the largest private sector employer in the economy, with 29 million workers. Retail also supports more than 42 million jobs, as anyone whose work results in a consumer product, from suppliers to factory workers to the truck drivers who deliver goods, counts on retail for their income.