COVID-19

On 9/11, pondering the COVID-19 recovery ahead

Kimberly Adams Sep 11, 2020
Heard on: Marketplace
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People visit the 9/11 memorial plaza in New York City. Spencer Platt/Getty Images
COVID-19

On 9/11, pondering the COVID-19 recovery ahead

Kimberly Adams Sep 11, 2020
People visit the 9/11 memorial plaza in New York City. Spencer Platt/Getty Images
HTML EMBED:
COPY

The pandemic continues in the U.S., but here in New York — once the epicenter of the outbreak — there are signs of recovery, like the return of limited indoor dining, for example.

This slow recovery from a painful disaster is especially relevant for the city today on the anniversary of 9/11.

In addition to the emotional trauma of 9/11, the terrorist attacks triggered an economic downturn. But the pandemic recession will probably look more like the aftermath of the 2008 financial crisis, according to Daryl Fairweather, chief economist at Redfin.

“That’s because during the 2001 recession, it was very short and things bounced back very quickly,” Fairweather said. “During 2008, it was actually the financial sectors in New York that were impacted and people lost their jobs.”

Affecting the housing market, just like now.

The pandemic has prompted many people to leave the city, pushing down rental prices for homes and commercial real estate.

James Orr is a former vice president at the New York Fed and is currently at the City University of New York. He says New York’s recovery now, just like after 9/11, “is going to be in part dependent on how the national economy recovers, and how strong that is going forward.”

And that broader economic recovery can’t really get going until the pandemic is under control. 

COVID-19 Economy FAQs

Are people still waiting for unemployment payments?

Yes. There is no way to know exactly how many people have been waiting for months and are still not getting unemployment, because states do not have a good system in place for tracking that kind of data, according to Andrew Stettner of The Century Foundation. But by his own calculations, only about 60% of people who have applied for benefits are currently receiving them. That means there are millions still waiting. Read more here on what they are doing about it.

Are we going to see another wave of grocery store shortages?

Well, public health officials are warning that we could see a second wave of the virus before the end of the year. And this time retailers want to be prepared if there’s high demand for certain products. But they can’t rely totally on predictive modeling. People’s shopping habits have ebbed and flowed depending on the state of COVID-19 cases or lockdowns. So, grocers are going to have to trust their guts.

What’s going to happen to retailers, especially with the holiday shopping season approaching?

A report out Tuesday 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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