“Looking Glass” ponders economic and real estate trends through two different lenses: the optimist “half glass is full” and the pessimist “half glass empty”.
Buzz: The highly contagious spin-off of the coronavirus can change consumer habits and stall the ongoing economic recovery from the limits of business in the pandemic era.
Discussion: Just as the coronavirus chills were nearing their end, the Delta variant returned coronavirus infections, hospitalizations, and deaths to levels not seen since early 2021. Health risk?
Half a glass full
It shouldn’t be a big surprise that there is a problem with economic recovery. No one expected it to return to normal completely smoothly.
California still had 1.24 million employment declines as of June, accounting for 93% of the state’s employment in February 2020, just before the virus broke out. The rest of the country is 96%.
But progress is being made. State-wide employers increased by 3% in the first half of 2021, compared to 2.2% in all other states.
Fortunately, Delta hits occur when at least half of the country is fully vaccinated against the virus. Citizens and businesses are also familiar with how to live and operate safely as the pandemic grows.
The long-term business outlook remains solid, as only the “new normal” timing may have been slightly delayed.
In fact, it can be argued that the delta variant can actually be an economic plus-not ignoring the serious health problems involved.
For example, the resurrected virus has encouraged many people to be vaccinated in recent weeks, bringing California and the country closer to vaccination levels that significantly minimize future viral risk.
And don’t forget Hot housing market.
The risk of the new coronavirus only further encourages house hunters to desire more living space.
Many employers are delaying the return of workers to traditional offices. This will increase the demand for home office space. This is a plus for purchases and remodeling.
Fear of Delta’s financial damage has also helped cut many interest rates in recent weeks. Homebuyers, who were afraid of more expensive mortgages in a rapidly recovering economy, are now getting another shot at these historically low interest rates.
Major mortgage rate benchmarks fell to 2.77% this week. It fell from 3.18% in April and approached a record low of 2.65% in January.
Half a glass of water
But Delta is another tough blow to the pandemic’s most devastated industry: the “fun” industry, which serves food eaters, travelers and entertainment seekers.
It’s not a minor delay. California’s leisure and hospitality sector accounts for 10% of all workers, but 40% of all jobs lost across the state since February 2020. This means that since February 2020, the number of workers in the state has decreased by 480,000, making the industry 77% of pre-pandemic employment. .. The rest of the country has 89% of the leisure and hospitality workforce in February 2020.
So far, we’ve seen significant improvements. “Fun” bosses increased 19% in the first six months of 2021, but increased 11% in all other states.
Still, the economic impact of Delta is not limited to restaurants, hotels and theme parks.
Look for a heated debate about whether the fall semester will be taught remotely or back on campus. For face-to-face learning, what are the restrictions such as masking and mandatory vaccinations?
Also, think about the labor shortage that is slowing down many industries. The resurrected virus will certainly scare some people back into the workforce soon. It further impedes the recovery of a company’s supply chain and can put missing products back on the shelves.
What the looking glass sees
The future is cloudy as the economy does not require much business expertise next. It’s mainly a bet on viruses.
This means that predictions require expertise in viral science and are the best way to assess health risks.
Sadly, it also requires some knowledge of politics. Undoubtedly, much of the future of business is particularly related to how state governments manage virus containment.
And psychological skills will also help.
Government edicts not only change consumption habits. How the public reacts emotionally to the rise in the delta is part of the equation that determines the companies that have been affected by the potential to change consumer preferences.
Jonathan Lansner is a business columnist for Southern California NewsGroup.He can reach at email@example.com
Could Delta stop the business rebound? – Press Enterprise Source link Could Delta stop the business rebound? – Press Enterprise
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