Disney’s Shanghai resort partially reopened. Will people go?
Share Now on:
Consumers are the linchpin of the U.S. economy. Spending by or on behalf of consumers amounts to about 70% of economic activity in the U.S. Which is all well and good when consumers are feeling good. But what happens when that confidence goes away?
Behavioral economist Peter Atwater at William & Mary compared consumer confidence to a tower made of Legos which COVID-19 has shattered.
“It takes a very long time to build it up,” Atwater said. “It’s inherently very fragile.”
It takes an even longer time to rebuild it. It’s easier to scare people away from public spaces than it is to get them to come back. Economist Howard Chernick, the author of “Resilient City: The Economic Impact of 9/11,” said that after the Sept. 11 attacks, the travel and leisure industry took the first big hits. People didn’t feel safe in public spaces.
“Las Vegas, which is a very tourist-dependent city, basically shut down,” he said. Chernick sees some similarities today. Once this crisis blows over, he said, it could take the leisure industry quite a while to get back on its feet — at least another year.
John Gerner, managing director of Leisure Business Advisors, which specializes in theme parks, held this position during and after 9/11. What he learned was that in order to get people back out, companies needed to be transparent.
“We can’t talk down to our guests,” Gerner said. “We have to work with them and essentially say, ‘Look, this is what we’re doing, and we’re going to need you, the guest, to do your share.'”
Meaning consumers also play a part in making it safe to go back out there, by taking the recommended precautions. Like, staying home when they’re sick and washing their hands often.
COVID-19 Economy FAQs
With a slow vaccine rollout so far, how has the government changed its approach?
On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.
What kind of help can small businesses get right now?
A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.
What does the hiring situation in the U.S. look like as we enter the new year?
New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.
As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.
Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.
Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.