South Bay Expected to Recover Economically – As Long as No More Shutdowns
The economy in The South Bay is expected to begin the slow process of recovering over the next few months from the massive setbacks that have been caused by COVID. While there are business restrictions still in place for some, the future looks somewhat bright for most, as long as there are no more economic shocks to rattle the area.
The issue is that any kind of sizable growth is not likely to occur until late 2021. Many companies are sitting on their hands and choosing not to hire until at least 2022. The South Bay Economics Institute gave out this stark warning in its latest forecast, which it had to publish online as the campus remains closed.
White-Knuckling it Until Things Improve
Unfortunately, many businesses have no choice but to white-knuckle it through these tough times, until things take a visible turn for the better. Many businesses are choosing to stay open and cut their losses while bridging the gap between current cash flow and their overheads with short term and personal loans.
If your company is in dire straits right now and needs a bit of help, given the current circumstances, consider your options that are available out there, including personal, bank or title loans. Look up ‘title loan places near me’ for your nearest lending vendor.
Any sustained recovery that has been predicted so far depends on a number of different factors, including the usage and availability of a vaccine, as well as federal stimulus packages and treatment developments.
Still a Huge Amount of Uncertainty
Fynnwin Prager, co-director of the institute, says that there is still a huge amount of uncertainty, as nobody can say how long this season will last. Prager continues by saying that It does seem like The South Bay is recovering relatively quickly. However, this is not to say that there are not any troubling signs of what could still be ahead.
While unemployment has declined since the initial shock, the rapid recovery that was initially predicted is taking longer than anticipated. Disneyland has just announced that they plan on laying off thousands of staff, and various airlines are also preparing to layoff tens of thousands of employees.
The gross domestic product declined by a third in the second quarter of the year, and as a comparison, the value of all services and goods produced in the United States declined by just 8.4% in the fourth quarter back in 2008 when everyone was still reeling from the financial crisis. Back then, it took 18 months for the economy to recover completely.
State Stops Processing Claims
With so many former workers now applying for unemployment, the state has to play catch up and has stopped processing any new claims to prevent a backlog. When it comes to the South Bay, employment was predicted to drop 15.6% in the second quarter when compared to the same period in 2019.
This percentage is higher than what was expected of the nation as a whole, yet despite this, the South Bay has been relatively resilient throughout the pandemic. With a variety of different industry sectors, this increases the area’s flexibility to recover more quickly from economic shocks.
When it comes to the real estate sector, there is a lot of pessimism and uncertainty. The bottom line is that nobody really knows what the future looks like, as businesses far and wide work hard to recover what they have lost throughout the season.
The recovery might be slow, but this time in the South Bay has proven that businesses and companies can take a lot of credit, pushing through and coming out the other side. Whatever the future holds, most businesses have a chance of hanging on as long as there are no more aftershocks.