Alamance Chamber's economic summit examines national, local COVID-19 impacts

Before diving into local data, Vitner delivered an overview of COVID-19’s economic impact on the country as a whole.

“In terms of the economy … this year, we had a sudden stop in the economy that really kicked in in March and April and it produced the deepest quarterly decline in GDP that we’ve ever seen because so much of the economy shut down,” Vitner said

Economic activity bottomed out mid-April, he explained, began recovering in May and June then leveled off over the summer.

“The rate of improvement slowed over the summer as we saw a wave of infections across the southern half of the United States,” he said.

As cases resurge in Europe, Vitner said many in the U.S. are worried it could be a sign of what’s to come with our country’s expected second wave of the virus.

As the possibility of a second wave looms, Vitner said analysts are tracking a number of national metrics including consumer spending, small business impacts and the general impact on the economy that the shutdowns had.

“Consumer spending recovered very quickly once things got up and running. Spending on goods has actually recovered within two months and is higher today than it was prior to the pandemic,” he said. “Spending on services, however, which includes everything travel related plus restaurants dining and things like fitness studios and haircuts, did not come back all that quickly.”

Vitner also pointed out that the shutdowns early on in the pandemic have disproportionately affected small businesses, especially those that are minority owned.

“Minority-owned businesses have been hit particularly hard by the shut down because many minority-owned businesses are providing that last mile of customer service and they are involved in parts of the economy where there is a great deal of physical contact,” Vitner said.

Forty percent of African-American owned small businesses and 32 percent of Latinx-owned businesses closed in April, while only about 20 percent of all small businesses closed, he explained.

Vitner said he expects the shock of the economic shutdown will have more long-term effects.

“When we have exogenous shocks like this, they usually produce lasting changes and shifts that were already taking place tend to be accelerated,” he said. “The shift to online shopping, online banking, those shifts are likely to be accelerated. … Telemedicine is another area that is likely to see its growth greatly accelerated and will play a much larger role in the economy going forward.”

“I think it’s going to tamp down some of the growth we’ve had in parts of the economy, but I think it’s going to unleash a lot stronger growth in others,” he added.

Vitner said he and his team do not expect to see a second round of economic shutdowns to the same extent as earlier this year, meaning a second shock is not expected.

Other national points of interest include the recovery of 55 percent of the 22 million jobs lost in March and April and a downward trend in first-time unemployment claims, according to Vitner.

Consumer confidence is also “surprisingly high,” Vitner said, with 56 percent of Gallup poll respondents saying they feel more financially secure today than they did four years ago.

“Consumer confidence today is higher than it was on Election Day 2016. It’s interesting given all the trouble we’ve seen,” he said. “What I think that reflects is that parts of the economy that have been most heavily impacted were just extraordinarily impacted, but many other parts of the economy have learned to adjust to the COVID environment fairly well.”

A local look

Taking a local look, Vitner started to dive into regional and statewide data, including discussion on job seekers moving to North Carolina cities at high rates.

“More job seekers or workers are moving to Austin[, Texas,] on a net basis than any other city in the country. Charlotte has been number two now for the last 18 months to two years. Raleigh is in at number six,” he said.

With the influx of new residents, home building in the state is also recovering rapidly, Vitner said. Consumer confidence is also recovering well, he added.

“Consumer confidence in North Carolina has actually recovered a little bit faster in North Carolina than it has nationwide, but it’s still well below where it was pre-pandemic,” he said.

While North Carolina has been slower to recover financially, Vitner said Alamance County is showing promise.

“North Carolina has been slower to reopen its economy than most states in the South. The only state that is in line with North Carolina has been Virginia,” Vitner said.

While the nation has recovered 55 percent of the jobs lost in March and April, North Carolina has recovered only 45 percent, with about 50,000 jobs that have still not been recovered, according to Vitner.

Alamance County, however, has recovered a higher proportion of jobs than many other metropolitan areas across the state.

“We’ve recovered 68 percent of the jobs lost in Alamance County, whereas every other metropolitan area in the state has recovered fewer than 50 percent.”

Asheville is second highest in the state with 47 percent of jobs recovered. Greensboro has seen 46 percent of jobs recovered, while Charlotte has seen 40 percent recovered.

Local economic development leaders also detailed the economic impacts of COVID-19 on the county earlier this month. More details on that are available here.

This article originally appeared on Times-News: Alamance Chamber's economic summit examines national, local COVID-19 impacts