One year into pandemic, sky begins to clear over US economy | The Business Standard
Skip to main content
  • Home
  • Economy
    • Aviation
    • Banking
    • Bazaar
    • Budget
    • Industry
    • NBR
    • RMG
    • Corporates
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
    • Book Review
    • Brands
    • Earth
    • Explorer
    • Food
    • Habitat
    • In Focus
    • Luxury
    • Mode
    • Panorama
    • Pursuit
    • Wheels
  • Epaper
    • GOVT. Ad
  • More
    • Subscribe
    • Videos
    • TBS Graduates
    • Thoughts
    • Splash
    • Bangladesh
    • Supplement
    • Infograph
    • Archive
    • COVID-19
    • Long Read
    • Interviews
    • Offbeat
    • Tech
    • Magazine
  • বাংলা
The Business Standard

Wednesday
December 06, 2023

Sign In
Subscribe
  • Home
  • Economy
    • Aviation
    • Banking
    • Bazaar
    • Budget
    • Industry
    • NBR
    • RMG
    • Corporates
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
    • Book Review
    • Brands
    • Earth
    • Explorer
    • Food
    • Habitat
    • In Focus
    • Luxury
    • Mode
    • Panorama
    • Pursuit
    • Wheels
  • Epaper
    • GOVT. Ad
  • More
    • Subscribe
    • Videos
    • TBS Graduates
    • Thoughts
    • Splash
    • Bangladesh
    • Supplement
    • Infograph
    • Archive
    • COVID-19
    • Long Read
    • Interviews
    • Offbeat
    • Tech
    • Magazine
  • বাংলা
WEDNESDAY, DECEMBER 06, 2023
One year into pandemic, sky begins to clear over US economy

Global Economy

Reuters
01 March, 2021, 05:50 pm
Last modified: 01 March, 2021, 05:51 pm

Related News

  • Trump: I won't be a dictator if I become U.S. president again
  • Despite Gaza death toll soaring, U.S. unlikely to rethink weapons supplies to Israel
  • US announces visa bans after warning Israel over West Bank violence
  • The Pentagon wants to root out shoddy drugs. The FDA is in its way.
  • US examined Hindenburg allegations before giving loan to Adani

One year into pandemic, sky begins to clear over US economy

While recent months have seen little progress, the outlook may be improving. Treasury Secretary Janet Yellen said in mid-February the country had a fighting chance to reach full employment next year

Reuters
01 March, 2021, 05:50 pm
Last modified: 01 March, 2021, 05:51 pm
FILE PHOTO: A worker cuts swimwear fabric to be used by swimwear company Helen Jon, which converted its manufacturing facilities to make non-medical grade face masks, during the global outbreak of the coronavirus disease (Covid-19), in Los Angeles, California, US, April 9, 2020. REUTERS/Mario Anzuoni
FILE PHOTO: A worker cuts swimwear fabric to be used by swimwear company Helen Jon, which converted its manufacturing facilities to make non-medical grade face masks, during the global outbreak of the coronavirus disease (Covid-19), in Los Angeles, California, US, April 9, 2020. REUTERS/Mario Anzuoni

Despite the US economy's near miss with a depression last year and an ongoing coronavirus pandemic that has brought travel to a virtual halt, Jeff Hurst, the chief executive of vacation rental firm VRBO, sees a boom on the horizon.

"Every house is going to be taken this summer," Hurst said, as the expected protection from vaccines arrives in step with warmer weather, unleashing a cooped-up population with record savings stashed away. "There's so much built-up demand for it."

That sort of bullish sentiment has increasingly taken root among executives, analysts and consumers who see the past year of comparative hibernation - from the government-ordered business closings last spring to continued risk avoidance by the public - giving way to a cautious re-emergence and green shoots in the economy.

The Business Standard Google News Keep updated, follow The Business Standard's Google news channel

Data from AirDNA, a short-term rental analytics firm, showed vacation bookings for the end of March, which traditionally coincides with college spring breaks, are just 2% below their pre-pandemic level. Employment openings on job site Indeed are 4% above a pre-pandemic baseline. Data on retail foot traffic, air travel and seated diners at restaurants have all edged up.

And economists' forecasts have risen en masse, with firms like Oxford Economics seeing a "juiced-up" economy hitting 7% growth this year, more typical of a developing country.

In a symbolic milestone, Major League Baseball teams took to the field on Sunday, as scheduled, for the first games of the spring training season. Crowds were required to observe social distancing rules and limited to around 20% of capacity, but MLB has a full schedule penciled in following a truncated 2020 season that did not begin until July and saw teams playing in empty stadiums.

DEPRESSION DODGED

As of Feb. 25, about 46 million people in the United States had received at least their first dose of a COVID-19 vaccine - still less than 15% of the population and not enough to dampen the spread of a virus that has killed more than half a million people in the country, according to the US Centers for Disease Control and Prevention.

The emergence of coronavirus variants poses risks, and a return to normal life before immunity is widespread could give the virus a fresh foothold.

Nor is optimism global. The European short-term rental market, for example, is suffering, with tens of thousands of Airbnb offerings pulled. Up to one-fifth of the supply has disappeared in cities like Lisbon and Berlin, as owners and managers adjust to a choppy vaccine rollout and doubts about the resumption of cross-border travel.

In the United States, the vaccine rollout and a sharp decline in new cases has produced an economic outlook unthinkable a year ago when the Federal Reserve opened its emergency playbook in a terse promise of action and Congress approved the first of several rescue efforts.

The fear then was years of stunted output similar to the Great Depression of the 1930s, while some projections foresaw millions of deaths and an extended national quarantine. Instead, the first vaccines were distributed before the end of 2020, and a record fiscal and monetary intervention led to a rise in personal incomes, something unheard of in a recession.

"We are not living the downside case we were so concerned about the first half of the year," Fed Chair Jerome Powell told lawmakers on Wednesday. "We have a prospect of getting back to a much better place in the second half of this year."

'ROCK ON'

US gross domestic product, the broadest measure of economic output, may top its pre-pandemic level this summer, approaching the "V-shaped" rebound that seemed unrealistic a few weeks ago.

That would still mean more than a year of lost growth, but nevertheless represents a recovery twice as fast as the rebound from the 2007-2009 recession.

Jobs have not followed as fast. The economy remains about 10 million positions short of where it was in February 2020, and that hole remains a pressing problem for policymakers alongside getting schools and public services fully reopened.

It took six years after the last recession to reach the prior employment peak, a glacial process officials desperately want to shorten.

While recent months have seen little progress, the outlook may be improving. Treasury Secretary Janet Yellen said in mid-February the country had a fighting chance to reach full employment next year.

It may take more than vaccines, however. Officials are debating how fully and permanently to rewrite the rules of crisis response - and specifically how much and what elements of the Biden administration's proposed $1.9 trillion rescue plan to approve.

Fiscal leaders last year cast aside many old totems, including fear of public debt and a preoccupation with "moral hazard" - the bad incentives that generous public benefits or corporate bailouts can create. For Republicans, that meant approving initial unemployment insurance benefits that often exceeded a laid-off worker's salary; for Democrats, it meant aiding airlines and temporarily relaxing banking regulations.

It worked, and so well that an odd consortium of doubters has emerged to question how much more is necessary: Republicans arguing help should be aimed only at those in need, and some Democrats worrying that so much more government spending in an economy primed to accelerate may spark inflation or problems in financial markets.

If the outlook is improving, however, it's in anticipation that government support will continue at levels adequate to finish the job.

"Rock on," Bank of America analysts wrote in a Feb. 22 note boosting their full-year GDP growth forecast to 6.5%, an outcome premised on approval of $1.7 trillion in additional government relief, "unambiguously positive" health news, and stronger consumer data. Given all that, "we expect the economy to accelerate further in the spring and really come to life in the summer."

And the view back at VRBO? In most prime vacation spots, Hurst said, "You won't be able to find a home."

Top News / World+Biz

USA / USA economy / Covid-19 Economic Recovery

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • BNP Vice Chairman Shahjahan Omar. Photo: Daily Sun
    Shahjahan Omar faces backlash from pro-BNP lawyers at Supreme Court
  • Prime Minister Sheikh Hasina. Sketch: TBS
    PM Hasina 9th on Forbes list of most powerful women in politics
  • File photo: Collected
    BNP now Jamaat's 'B-team': Quader

MOST VIEWED

  • Caption: Illustration: TBS
    Source tax on land registration cut again
  • This file photo from December 2019 shows a rider driving his motorcycle through cold wind and fog. A scene not yet visible this year. Photo: Mumit M
    Woe for seasonal crops, vegetables as winter comes late 
  • File Photo: Reuters
    $1.08 billion could be added to Bangladesh's dwindling forex reserves
  • Photo: Courtesy
    Woman entrepreneur Sangeeta Khan dies at age 62
  • 59 DSE stocks face downgrade to junk category
    59 DSE stocks face downgrade to junk category
  • Dollar pressure rises as short-term foreign debt drops $300m in October
    Dollar pressure rises as short-term foreign debt drops $300m in October

Related News

  • Trump: I won't be a dictator if I become U.S. president again
  • Despite Gaza death toll soaring, U.S. unlikely to rethink weapons supplies to Israel
  • US announces visa bans after warning Israel over West Bank violence
  • The Pentagon wants to root out shoddy drugs. The FDA is in its way.
  • US examined Hindenburg allegations before giving loan to Adani

Features

Photo: Rexy Jason Gomez

A big love for the small wheels

1h | Features
Dhaka’s FDC,  Japan Garden City and Shia Masjid were all part of Gudaraghat once. PHOTOS:  Syed Zakir Hossain

What the remaining Gudaraghats remind us of Dhaka's long-lost water bodies

8h | Panorama
A trove of research underscores the perilous consequences of relying on plastic utensils, a narrative mirrored by the western world's pivot towards sustainable alternatives - ceramic, brass, or clay dinnerware. PHOTO: TBS

While we lose our sustainable traditions, the West pivots in the opposite direction

7h | Panorama
Ghulam Ali

Ghulam Ali: Voice that makes ghazals bloom

1d | Features

More Videos from TBS

What is 'obstructing the field' out?

What is 'obstructing the field' out?

25m | TBS SPORTS
Most Ukrainians are losing interest in going to war

Most Ukrainians are losing interest in going to war

2h | TBS World
Putin to visit UAE and Saudi Arabia

Putin to visit UAE and Saudi Arabia

4h | TBS World
Will the United States - Israel attack Yemen?

Will the United States - Israel attack Yemen?

18h | TBS World
EMAIL US
[email protected]
FOLLOW US
WHATSAPP
+880 1847416158
The Business Standard
  • About Us
  • Contact us
  • Sitemap
  • Privacy Policy
  • Comment Policy
Copyright © 2023
The Business Standard All rights reserved
Technical Partner: RSI Lab

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - [email protected]

For advertisement- [email protected]