In the case of a typical sub-Saharan African country with a prevalence rate of 20 per cent, overall GDP growth would be 2.6 per cent lower each year. At the end of 20 years, the economy would be two thirds smaller than it would otherwise have been. Workers AIDS reduces the number of healthy workers, especially experienced workers in their most productive years. This raises dependency, diminishes human capital, and may cut productivity growth by as much as 50 per cent in the hardest hit countries. In the public sector, AIDS reduces government revenues and puts severe strain on budgets as spending on health and social welfare mount.
Scarce capacity is depleted, and the return on other public investments falls.
Human resources are lost, public revenues reduced and budgets diverted towards coping with the epidemic's impact. Similarly, the organizational survival of civil society institutions is under threat, with a corresponding impact on democracy. In the private sector, firms face higher costs in training, insurance, benefits, absenteeism, medical costs, sick leave, funerals and pensions. At the same time, the average experience of their labor force falls, reducing accumulated knowledge within firms. The most seriously affected businesses are those that are labor-intensive, such as transport.