Columbus Innovation District Announced
This report is a summary of third-party economic research and perspectives to foster communication with business and economic development stakeholders during the COVID-19 crisis.
Published: Wed Feb 24 2021
Key Economic Insights
- Global: The world economy continues to climb back from the depths of the COVID-19 crisis, but prospects for recovery are diverging across regions and countries, according to the IMF.
- U.S.: The path of the economy continues to depend significantly on the course of the virus and the measures undertaken to control its spread, based on Federal Reserve’s latest testimony.
- Ohio: The Columbus Innovation District aims to create 20,000 jobs with $3B economic impact.
A global recovery from the crisis hinges on making rapid progress against the pandemic and providing effective economic support until the virus is beaten back. advanced and some emerging market economies are expected to gain widespread access to vaccinations during 2021, whereas others face a much longer wait.
The winter storm freeze throughout the U.S. may become a global oil production issue as more than 40% of the nation’s crude production remains offline according to traders and executives. Brent crude briefly surged to over $65 a barrel, a level not seen since prior to the pandemic. Traders and consultants now expect a full resumption of oil production to take weeks, rather than a previous expectation of 2-3 days. Saudi Arabia announced that by 2024 its government would cease doing business with any international companies whose regional headquarters were not based within the kingdom. The European Central Bank policymakers warned that a temporary boost to inflation should not be mistaken for a sustained increase.
Applications for unemployment claims rose last week to 861,000, evidence that layoffs remain painfully high despite a steady drop in the number of confirmed viral infections. Nearly two-thirds of workers who started getting jobless benefits in October had also collected them earlier in the crisis, according to a new research by University of Chicago and JPMorgan Chase Institute, signaling another dimension of pain in the labor market nearly a year into the pandemic. In California, 96% of new unemployment claims are repeat applications from workers in accommodation, food services and arts, entertainment and recreation industries. Even with skyrocketing U.S. unemployment, businesses that relied on foreign workers and were able to remain open during the pandemic struggled to fill jobs.
The consumer price index increased 0.3% January after climbing a revised 0.2% in December. Retail sales, a measure of purchases at stores, at restaurants and online, jumped a seasonally adjusted 5.3% in January from a month earlier, and manufacturing output neared pre-pandemic levels. Nationally, office leasing demand was down 61% in January 2021 from December 2019. Americans took out a record $1.2T worth of mortgages in the final three months of 2020, locking in historically low interest rates. Borrowers with high credit scores, above 760, fueled the surge by accounting for more than two thirds of total originations for the quarter.
Walmart, the nation’s largest private employer, is raising wages for 425,000 of its nearly 1.5M employees to a range of $13 to $19 per hour. Walmart now has about 730,000 U.S. store associates, approximately half of its workforce, earning $15 or more per hour. Ford will invest $1B in a German factory as part of a plan to phase out gas-powered cars in Europe by 2030, the latest auto maker to embrace a shift to electric vehicles. An estimated 368M passengers flew in 2020, the lowest number since 1984, as U.S. air carriers faced their most difficult economic year in history. U.S. airliners lost a combined $46B in pre-tax dollars due to the reduced traffic.
A ‘siege of winter storms’ since late January contributed to the most widespread snow cover across the contiguous U.S. in at least 17 years. Roughly 150M Americans were at some point under a form of winter storm warning. Close to 3M households in Texas were left without electricity and blackouts spread across the central U.S., after arctic air caused disruption and outages at power plants just as heating demand soared. After creating havoc in the power and natural gas markets, the next commodity sector causing concern in Texas is the oil refining industry, where more than 3M barrels of daily oil-processing capacity has been idled in the wake of the record-setting cold.
Ohio Employment & Economic Insights
Ohio Governor Mike DeWine and Lt. Governor Jon Husted were joined by JobsOhio, The Ohio State University, Nationwide Children’s Hospital, Franklin County, the City of Columbus, and state legislators to unveil the Columbus Innovation District, which aims to create 20,000 jobs with $3B economic impact for Ohio. Ohio State is investing $647M on 270 acres of university-owned land on its West Campus.
Gov. DeWine announced Ohio has developed a central coronavirus vaccine registration website to allow people to sign up for the vaccine and is working to add providers to the system. Ohio has administered the fifth-highest number of doses nationally through the Center for Disease Control and Prevention’s Pharmacy Partnership for Long-Term Care Program.
Positive Company-Specific News
- ALG Health received National Institute of Occupational Safety and Health (NIOSH) Surgical N95 approval for three of its Made in the U.S.A. Patriot Masks.
- Amazon will operate regional distribution logistics from a new Findlay location, with 160 new job and an additional $5M investment into the site from Amazon.
- Progressive expanded its commercial lines products with the acquisition of Protective Insurance.
- Hudson’s Jo-Ann Stores is going public.
- Kroger Health released a new vaccine scheduling tool to make it easy and efficient to book COVID-19 vaccine appointments.
- The Anderson’s reported its fourth quarter 2020 profits rose 140% on the strength of booming demand for grain and fertilizer.
- Crown Equipment, one of Western Ohio’s fastest growing global manufacturers, is looking to fill about 100 Ohio-based positions and over 300 nationwide. It is looking to fill positions based on “ongoing demand for its supply chain equipment, technologies, and services.”
- Medpace of Cincinnati released financial results for Q4 and full-year 2020 which showed a 13% revenue increase for the quarter, and a 7.5% increase for the year. Net income for the year was $145M, compared with $100M from the year prior.
- Cincinnati Bell reported revenue of $1.56B for 2020 – up 2% year-over-year as its CEO noted their investments in metro fiber and strategic IT solutions produced incredible results for the company.
- Plaskolite, North America’s leading manufacturer of thermoplastic sheet and specialty acrylic polymer, was honored with the 2020 3M Supplier of the Year Award in recognition of the company’s contribution to improving 3M’s competitiveness.
Negative Company-Specific News
- TimkenSteel of Canton will be indefinitely idling its melt shop at its Harrison Steel Plant in April, laying off 99 employees.
- Kellogg is cutting 250 jobs from Mariemont plant.
- Ohio-based real estate investment trust, Washington Prime Group, skipped a debt payment and has hired restructuring advisors causing company shares and bonds to plummet.
- La-Z-Boy Inc., of Monroe, reported that its fiscal third quarter fell 15% due to supply chain disruptions caused by the pandemic.
- Owens Corning, of Toledo, reported a net loss of $383M on revenues that were down 1.5% due to the ongoing effects of the pandemic.
- Cedar Fair reported it lost $590M during 2020 after revenues shrunk 88% due to ongoing pandemic concerns and effects.
- Dana reported an 18% sales drop for 2020, or $31M, as manty of its customers were forced to shut down to the pandemic.