We’re now two years out from the onset of the Covid pandemic. I’m as eager as anyone to move on from the odious pandemic, but the economics of it bend the mind.
Let’s start with the roller coaster.
Nothing in U.S. economic history compares to the drop in economic activity in March and April 2020. Between 1929 and 1933, the four most monstrous years of the Great Depression, U.S. real GDP fell by 26.3 percent. It fell by 31.2 percent in the second quarter of 2020.
In March and April 2020, U.S. employment fell by 25.6 million, a 16 percent drop. The nation’s unemployment rate went from 3.5 percent to 14.7 percent.
In Georgia, employment fell by 14 percent, while the unemployment rate went from 3.4 percent to 12.5 percent. In Glynn, employment fell by 18 percent. Our unemployment rate went from 3.2 percent to 16.7 percent.
In 60 days.
The rebound followed. U.S. real GDP increased by 33.8 percent in the third quarter of 2020. In the second quarter of 2021, one year after shrinking by 31.2 percent, U.S. real GDP eclipsed its pre-pandemic level.
U.S. employment is currently 1.7 million below its pre-pandemic level, while the U.S. unemployment rate is half a percentage point above its pre-pandemic level. But both gaps are shrinking.
Georgia employment eclipsed its pre-pandemic level in November 2021. Its current unemployment rate of 2.6 percent is the lowest on record.
Glynn employment eclipsed its pre-pandemic level in March 2021. Since September 2021, Glynn’s unemployment rate has ranged between 2.1 and 2.3 percent. Until September 2021, the county’s lowest unemployment rate on record was 2.6 percent in May 1999.
The size and structure of our hometown economy make its swift recovery from the 60-day pandemic plunge all the more remarkable. We’re small, bordering on rural, with an industrial structure dominated by a single sector, leisure and hospitality.
The specifics are informative. The largest industry in the U.S. and Georgia is professional and business services. In 2019, professional and business services accounted for 14.1 percent of U.S. employment and 15.9 percent of Georgia employment. Leisure and hospitality ranked third among sectors in both the U.S. and Georgia and accounted for 11 percent of employment in each.
Leisure and hospitality accounted for 22.1 percent of Glynn employment in 2019. That 22.1 percent not only dwarfs the employment share of the leading sector in the U.S. and Georgia, it’s twice the size of the industry’s share in the nation and the state.
Nothing is weird or surprising about Glynn’s industrial structure. The place is tailor-made for leisure and hospitality.
The point is: the pandemic hammered leisure and hospitality far more than any other industry. In our small, borderline-rural county, 33 percent of the jobs in an industry that employs 22 percent of workers disappeared in 60 days. Who would have figured that in less than a year and a half we’d have four consecutive months of the lowest unemployment rates on record? Not me.
The rapid rebound from the 60-day plunge is not the only economic mind-bender of the pandemic. After all the changes the pandemic brought to the ways that businesses and consumers operate, and all the job, industry and career changes workers have made, the employment shares across industries are now little different from what they were before the pandemic.
Here’s another head-scratcher. In March and April 2020, while employment tanked, the number of businesses in the U.S., Georgia and Glynn increased. After April 2020, the spate of entrepreneurship accelerated.
Between the pandemic riddles and our demographics, we have some exploring to do.
Reg Murphy Center