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.
- Global: The World Bank expects global economy to grow 4% in 2021 after contracting 4.3% in 2020.
- U.S.: Job losses in 2020 were worst since 1939 – as the economy shed a net 9.4M jobs.
- Ohio: The state’s critical goods leadership continues with an announcement by Heartland Health to more ergonomic mask design using only U.S. suppliers.
Confirmed cases of COVID-19 have now passed 89M globally, according to the Johns Hopkins Coronavirus Resource Center. The number of confirmed deaths stands at more than 1.9M. China introduced a new lockdown in the northern city of Shijiazhuang, after new COVID-19 cases were confirmed there. Japan declared a limited state of emergency in the capital of Tokyo, along with three neighboring prefectures. Europe surpassed 25M COVID-19 cases on Thursday according to a Reuters tally with several countries reinstating lockdowns or measures as the pandemic threatens to overwhelm health systems. The region has recently begun reporting over a million new cases about every four days and is currently the worst-affected region with nearly 30% of the global cases and deaths despite only a tenth of the global population. Germany extended their lockdown through the end of January, and British PM Boris Johnson announced new national lockdown mandates on Tuesday that he states will last ‘at least six weeks.’
The World Bank stated the global economic recovery from COVID-19 will rely heavily on the successful rollout of vaccines. The bank forecast that world GDP would grow by 4% in 2021, but with assumptions of rapid vaccination campaigns throughout the advanced economies of the world. If infections continue to rise and vaccine rollouts in major economies are slowed, global GDP could expand by as little as 1.6%.
December capped the worst year for U.S. job losses in records tracing back to 1939, with Hispanics, Blacks, teenagers and high-school dropouts hit particularly hard. In 2020, the economy shed a net 9.4M jobs, exceeding the 5M jobs lost in 2009, in the aftermath of the global financial crisis. New jobless claims unexpectedly steadied below 800,000 at the turn of the new year but still held at a historically elevated level, as the labor market struggled to regain traction amid the ongoing pandemic. A $900B stimulus bill was signed into law, avoiding a government shutdown. The package will extend aid to millions of struggling households through stimulus checks, enhanced federal unemployment benefits, and money for small businesses, schools and childcare, as well as for vaccine distribution. It also repurposes $429B in unused funding provided by the CARES Act for emergency lending programs run by the Federal Reserve. The U.S. now is projected to expand 3.5% in 2021, down from 4% in the World Bank’s June forecast.
The December Manufacturing PMI registered 60.7%, up from the November reading of 57.5%. ISM’s service PMI rose to 57.2% in December from 55.9% in November. U.S. consumer sentiment ended 2020 well below pre-pandemic levels according the latest survey data from the University of Michigan. The final reading for 2020 registered at 80.7, up from 76.9 in November, but down well below the 101 that was registered in February before COVID-19 pandemic lockdowns began in March. On December 22, the Bureau of Economic Analysis reported that consumer spending dropped 0.4% in November, the first drop since April. The U.S. trade deficit hit a 14-year high with the foreign-trade gap in goods and services expanded 8% from the prior month to a seasonally adjusted $68.1B in November.
The number of homes for sale in the U.S. reached an all-time low in December, dipping below 700,000 for the first time as buyers remained active throughout the traditionally less active winter months. Overall, national inventory declined by 39.6% over the last year and the December national median listing price was $340,00 – up 13.4% compared to the year prior. U.S. corporate bankruptcies reached their worst levels in 10 years during with 630 companies in 2020, surpassing the number of filings in every year since 2010. Notable high-profile bankruptcies include Neiman Marcus, JC Penney, Chesapeake Energy, and Ascena Retail Group.
Ohio has been a Top 10 ranked state in Chief Executive’s Annual CEO Survey of Best States for Business in each of the past three years. Ohio ranks 4th best state for migration growth according to U-Haul’s traffic data. ODJFS reported that 29,709 people filed new unemployment claims in Ohio last week, in addition to 274,450 continued jobless claims. Ohio Department of Health reported nearly 1,000 coronavirus deaths to patients of nursing homes and other long-term care facilities over the last four weeks. Two state senate bills recently signed by Ohio’s Governor Mike DeWine incentivize investment and development in urban cores.
Earlier this week, Governor DeWine and his administration outlined Ohio’s Vaccination Program timeline which includes a phased approach. Phase 1A includes healthcare workers and other high-risk patients and includes approximately 1M Ohioans. Phase 1B will begin after 1A is completed and focuses largely on those who are 65 and older, and K-12 staff in schools. Ohio’s PPE leadership continues with an announcement by Heartland Health to begin production of a new, more ergonomic mask design using only U.S. suppliers.
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