When businesses reopen, will consumers come back amid COVID-19 concerns?
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States are making different calls right now about phasing businesses back in, with COVID-19 still spreading and deaths still mounting nationally.
Georgia Gov. Brian Kemp has declared that, as of Friday, some service businesses — like hair salons, massage therapists and fitness centers — can reopen, allowing residents to do more than grocery shopping in an effort to preserve businesses and boost the economy. Experts warn this could spread the disease. Will consumers go to these businesses, given the health risk?
After weeks of stay-at-home orders, there are bound to be some consumers ready to step out for haircuts and work-outs.
But to jump-start the economy, consumers need disposable income. With layoffs mounting, that’s in short supply, says Camilla Yanushevsky at CFRA Research.
“Even if people do get rehired and find a new job, I think they’re going to be kind of stingy with their spending,” Yanushevsky said.
Many who are still working won’t be inclined to go out either. They’re scared of getting sick.
“Consumer confidence has fallen dramatically each day, in line with the number of confirmed cases,” said John Leer at Morning Consult.
As long as COVID-19 keeps spreading, Leer says, announcements that businesses are open again may not make much difference.
“Consumers are saying it’s going to be about three to six months before they feel comfortable going out to eat, going to a movie theater,” he said.
Leer says consumers will need to know that testing is widely available and that there are ways to trace and isolate people who are sick, to keep others safe from contagion.
COVID-19 Economy FAQs
How many people are flying? Has traveled picked up?
Flying is starting to recover to levels the airline industry hasn’t seen in months. The Transportation Security Administration announced on Oct. 19 that it’s screened more than 1 million passengers on a single day — its highest number since March 17. The TSA also screened more than 6 million passengers last week, its highest weekly volume since the start of the COVID-19 pandemic. While travel is improving, the TSA announcement comes amid warnings that the U.S. is in the third wave of the coronavirus. There are now more than 8 million cases in the country, with more than 219,000 deaths.
How are Americans feeling about their finances?
Nearly half of all Americans would have trouble paying for an unexpected $250 bill and a third of Americans have less income than before the pandemic, according to the latest results of our Marketplace-Edison Poll. Also, 6 in 10 Americans think that race has at least some impact on an individual’s long-term financial situation, but Black respondents are much more likely to think that race has a big impact on a person’s long-term financial situation than white or Hispanic/Latinx respondents.
Find the rest of the poll results here, which cover how Americans have been faring financially about six months into the pandemic, race and equity within the workplace and some of the key issues Trump and Biden supporters are concerned about.
What’s going to happen to retailers, especially with the holiday shopping season approaching?
A report out recently from the accounting consultancy BDO USA said 29 big retailers filed for bankruptcy protection through August. And if bankruptcies continue at that pace, the number could rival the bankruptcies of 2010, after the Great Recession. For retailers, the last three months of this year will be even more critical than usual for their survival as they look for some hope around the holidays.
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