Natalie Gochnour, Director of Kem C. Gardner Policy Institute, Associate Dean of the University of Utah David Eccles School of Business, and member of Utah’s COVID-19 Economic Response Task Force gave an update to Salt Lake County this week on our economic outlook. You can access a recording of the presentation here, it starts around the 1:05 minute mark.
It’s a little bit of a bad news/good news update, and we’re thankful for Natalie’s leadership on the subject.
First and foremost, we loved the key point made:
“We can now econometrically show the relationship between health case counts and unemployment. When there’s a rise in case counts, we will feel the pain a month later on the economic side.”
The COVID-19 recession isn’t like a typical recession. It is the opinion of Gochnour and other economists that we will not have a “V”-shaped recovery. Instead, we are going to gradually work our way back up. It is going to take some time.
Gochnour points out that the best thing we can do for the economy is not become complacent in fighting the coronavirus because it negatively impacts consumer confidence, and our economy.
Now for the good news.
Gochnour points out just how very different Utah is from the rest of the U.S. economy right now. One tool to show this is the Economic Coincident Indicator Index which takes several measures – unemployment, job growth, compensation, manufacturing hours worked and groups them into one indicator. Recently, while the entire U.S. dropped by 5.2%, and every single state except Utah is also showing a decrease. However, we are showing a 5.9% increase. “We are on an island, a different place,” says Gochnour.
In terms of job change over time, we do better against the national average. At Utah’s lowest point, we are at the same place where the U.S. is today (seven months into the virus).
Our construction industry is leading a lot of growth despite the recession.
The direct relief of the CARES Act provided millions of dollars for our State’s business owners. And while it is coming to an end, or at least leveling out for now, it’s a good time to be grateful for the fact that Utah’s PPP assistance had the highest rate of loan amounts (as a percent of payroll) in the country.
In order to help forecast how the evolution of COVID-19 will shape our community’s recovery, the Good Judgement Project is showing how vaccine odds have stabilized – the outlook or “when we will feel some sense of stability” sweet spot seems to be Jan/Feb 2021.
We’re grateful for Natalie Gochnour’s insight and forecast during this challenging time. When we follow public health guidelines and common-sense economic rules, we will give our City the best opportunity to minimize the economic impact long term.
Let us all continue the good work of requiring and enforcing mask wearing in your place of business. Please visit our COVID-19 Business Resources page for more help, and for any questions or feedback please email us at firstname.lastname@example.org.