The COVID-19 pandemic continues to exact a major toll in terms of human health and wellbeing, as well as the economy. Cases, hospitalizations, and deaths have risen recently due to the delta variant, and the spike has caused substantial disruptions. Despite these concerns, there has been massive resistance by some policymakers and individuals around the country to basic protective measures, which is resulting in preventable losses to the economy through reduced employment and decreases in productivity.
August job gains for the US were disappointing, with an increase in total nonfarm payroll employment of 235,000 and the unemployment rate down 0.2 percentage point to 5.2%. An increase of this magnitude isn't bad by historical standards and is, in fact, somewhat above the average during the 11 years of expansion prior to the pandemic. However, it's not the strong economic recovery from the COVID downturn we would like to see, and it's a far smaller increase than those observed in recent months.
Housing prices are up. Way up! The robust market reflects a variety of factors, including population growth, job opportunities, and interest rates. During the pandemic, demand increased as people looked to upsize to allow more room for at-home work and/or school. Remote work also allowed many households to relocate, while stimulus funds helped many with down payments. At the same time, the pandemic slowed construction due to production shutdowns, logistics bottlenecks, and resulting shortages (and price increases) of some building materials – and a tight labor market didn't help. In other words, in our highly complex modern economy, the basics of supply and demand are alive and well.
On August 29, Hurricane Ida made landfall near New Orleans causing wind damage and flooding. Its remnants have caused significant issues across the eastern United States. The human suffering is of paramount importance and should be the primary concern, as well as enormous emotional losses. In addition, the storm will have a significant impact on the economy.
Newly released Census data indicates that the US population is becoming increasingly diverse. The most prevalent racial or ethnic group was the White alone non-Hispanic population at 57.8%, down from 63.7% in 2010. The Hispanic or Latino population was the second largest, comprising 18.7% of the total, while the Black or African American alone population was third at 12.1%.
The US Census Bureau continues to release results of the 2020 Census. The information is crucial to effective corporate planning, as well as to understanding the dynamics of the nation’s population and potential policy needs or implications. One recent dataset describes overall population growth and trends in the number of people under age 18.
Texas has recently seen a sharp upswing in COVID-19 cases, hospitalizations, and deaths. This spike has caused substantial disruptions and hardships to families across the state (including many children), compromised safety as schools seek to reopen and address the massive educational gap that has surfaced during the pandemic, and added further strain to an already fragile healthcare complex. Despite these concerns, there has been massive resistance by policymakers to sensible and basic protective measures, such as appropriate masking requirements and measures to encourage higher vaccination rates. In addition to these obvious consequences, this approach is also resulting in preventable losses to the economy through reduced employment and decreases in productivity. The Perryman Group (TPG) has recently quantified these adverse effects.
Dr. Perryman explains how the economy will change based on changing demographics within the country.
The US Senate recently passed a $1.2 trillion infrastructure bill in a rare and much needed bipartisan action to inject funds to fix and expand roads, bridges, water systems, the power grid, and other pressing priorities. It will doubtlessly go through some delays, detours, and drama in the House, but seems destined to ultimately make its way to the President's desk and a waiting pen (hopefully sooner rather than later). After a laughable number of "Infrastructure Weeks" in Washington DC for many years, we are finally on the cusp of an "Infrastructure Decade."