What is the forecast for economic recovery? Many of our local businesses have questions and want to know what the future looks like. While we don’t have a crystal ball, we do have resources that are useful to help explain what is coming next:
First, social distancing is working – indicators show we may be flattening the curve, and although we are all aching to get back to work and restart our economy, the goal is to make sure COVID-19 does not reignite in our communities causing further damage.
Economic recovery depends on testing – a cornerstone in the State of Utah’s response efforts, as explained by Angela Dunn, the state epidemiologist. And while Utah’s testing is better than most of the U.S. we are not anywhere near the level of testing needed statewide.
Efforts are underway to address this testing disparity and to give us better data on what really is out there. Thanks to our Silicon Slopes community, the www.TestUtah.com push is helping to solve that problem.
Salt Lake County health department workers are revved up, working exhausting six-day weeks, tracing the contacts of people infected with COVID-19.
Likewise, Salt Lake City-based ARUP Labs has begun efforts for coronavirus antibody testing. Our hope is if testing gets to the point where people can be tested for antibodies even without a prior COVID-19 test, many more could get back to work sooner.
Industry Help – What Can I Do for My Business Now?
For industry-specific health declarations, the State of Utah has compiled a list of orders here. In addition to resources from the State of Utah, BioUtah has compiled some additional help for the life sciences industry. Get ongoing coverage and resources for the outdoor industry with SNEWS here. Silicon Slopes continues to serve and update our community with their Silicon Slopes Community Slack Workspace. The Utah Cultural Alliance is providing more support for our arts, museum, and humanities industry.
In the meantime, with nearly 85% of employers currently asking employees to work from home, we’re in a forced experiment. We know those who innovate, find new opportunities, and tweak this new model of work will reap rewards in the long term. And with Utah’s startup track record, we are hopeful for a big show.
Retail and service industries who rely on foot traffic must innovate and plan for their return while navigating financial relief options. Utah’s Economic Recovery Plan “Utah Leads Together” identifies ‘impacts to retail, entertainment, cultural, and other select industries will continue, but lessen’ during the Stabilization Phase.
And with a focus on best case scenario the Recovery Phase might begin as soon as late July 2020 (the wide end of that projection might be late November):
Recovery Phase identifies the return of spaced in-house dining and resumed sports and entertainment. Strategic health supply chains recover and many re-shore. Pent-up demand comes on strong. Small businesses begin their recovery.
Workforce Recovery
The sign of the Stabilization Phase is that job losses will begin slowing — which may begin as soon as mid-May, or as late as early June. Again, all speculation and impossible to predict without confirmation that the COVID-19 transfer rate is less than one and declining. Broad-based testing and continued social distancing will ensure success.
While we have not seen unemployment projections yet, we suspect the recovery may resemble something close to the 2008 recession, with more of an accelerated timeline. Speed of workforce recovery success will come in part from RESEA (Reemployment Services and Eligibility Assessment Program) which helps individuals receiving unemployment benefits get back to work sooner; which, in turn, helps save employers’ tax contributions in the state’s Unemployment Compensation Trust Fund. Those in vulnerable industries may also take advantage of rapid re-skilling programs. You can also help by sharing new job openings and those opportunities of industries (not as impacted by COVID-19) who have a strong need for employees.
COVID-19 is like a natural disaster, and the response is more like an emergency relief than it is a typical stimulus or anti-recessionary response. Speed and simplicity are required in the short-term. Salt Lake City answered the call with our Emergency Loan Program and Tip Your Server ProjectTip Your Server ProjectTip Your Server Project. The State of Utah also followed with an emergency bridge loan. Scale is the operative word for the medium-term recovery – federal programs are starting to take hold. Long term, it is on us to get this right – a concerted support from all sectors – private and public – to help our small businesses bounce back.
University of Utah’s Kem C. Gardner Institute points out that Salt Lake City must “Keep the long term in sharp focus: The short term will pass. Utah has endured two recessions over the past 20 years. In 2001-02 we withstood the triple hit of the dot.com collapse, 9/11, and a post-Olympic slowdown. For the first time in 37 years, Utah lost jobs on a year-over basis in 2002. But the downturn was short and recovery robust.”
This is a moment that demands coordinated, decisive, and innovative policy action from our entire community. Is it a recession? Possibly. But the timing is unprecedented and the normal rules no longer apply. Utah is proving, once again, to accept the challenge and we are confident that Utah will once again lead the economy in a national recovery.
We’re here to help. If you haven’t already please visit our COVID-19 Business Resources page and let us know what you need more help with. Have a question or comment? We would love to hear from you. Please reach out here, social channels, or contact our team – email: ed@slcgov.com or call (801) 535-7200.
Salt Lake City Department of Economic Development 