The week the Delta variant threatened the economy

• The highly contagious Delta variant of the coronavirus now makes up the majority of US Covid cases.
• Americans are getting worried, sending markets on a fleeting plunge this week.
• While economic data suggests a robust recovery, the Delta variant remains a threat.

Just when Americans are getting into the throes of a hot vaxx summer, the Delta variant of the coronavirus is trying to stop the fun.

The far more contagious variant currently accounts for 83% of all new sequenced COVID-19 cases in the US, the CDC announced on Monday. That's up from 50% the week of July 3, and even higher in areas of the US with low vaccination rates, CDC Director Rochelle Walensky said.

She added that America is entering a "pandemic of the unvaccinated"

It's increased the odds of Covid "breakthrough" infections among vaccinated people, a growing minority of which - from the New York Yankees to Vegas partygoers - have caught Covid. The good news is that the vaccinated remain well protected from serious disease, likely to have mild or no symptoms, and carrying with them a low transmission risk.

But Biden officials and the CDC are reportedly considering stricter mask-wearing guidance to protect unvaccinated people as Delta cases spike. Dr. Anthony Fauci has even said that fully vaccinated Americans may "want to consider" wearing masks indoors again.

It doesn't help that the common cold is running rampant across the US as we return to socializing with others sans masks. Respiratory viruses, which mimic Covid-like symptoms, are giving many a Covid scare.

With only half the population vaccinated, all the germs on the loose were enough to put America on edge this week.

A threat to the economy

As fears over the Delta variant have risen, even Fox News began emphasizing vaccine awareness and the efficacy of vaccines. The network's vaccine coverage has often mirrored its overall pandemic framing of public health measures as culture wars, Insider's Jake Lahut reported.

While several hosts have previously touted the shots, Monday saw a significant leap in the network's vaccine promotion. Fox News hosts cranked up their vaccine messaging and programming featured banners of the federal government's vaccine domain page.

Markets freaked out on the same day, with the S&P 500 closing down about 1.6% on the day. Investors appeared to be spooked about the rise in Delta variant cases across the country. That worry was fleeting, however, as stocks quickly rebounded over the next couple days, with the S&P 500 closing higher on Thursday than it had the week before. Stocks even ended the week hitting record highs.

Still, the presence of the Delta threat is real. The US missed President Joe Biden's goal to have at least 70% of adults partially vaccinated by July 4. Currently, 68.6% of adults are partially vaccinated and only 59% fully vaccinated.

That leaves millions unvaccinated, at risk of exposure to the variant. Left unchecked, it could slow down America's economic recovery.

A new round of shutdowns or unimpeded spread of the highly contagious Delta variant among the unvaccinated population could lead to businesses closing and more layoffs and furloughs like what was seen last spring. It could also make the American shopper go back into lockdown, Bank of America forecasted. And, while the CDC has urged schools to fully reopen, there's still uncertainty around returning as coronavirus cases rise again.

But this hasn't happened yet, and most of the economic data from the last several weeks still suggests a robust recovery. The US added 850,000 jobs in June, getting the labor market steadily closer to recovering the jobs lost in spring 2020. The leisure and hospitality sector in particular, which includes restaurants, bars, and hotels that were hit especially hard last spring, saw rapid job growth and big wage gains for workers.

Economists expect next week's gross domestic product figures to show the US economy expanding at the fastest pace since the early 1980s, with the exception of a spike last fall coming off the historically low levels of activity last spring.

Still, the Delta virus is adding a speed bump in America's path to a post-pandemic world. While we may be progressing toward normalcy, life still won't be completely normal by fall. The economy is still under threat.