His latest paycheck was about 80 percent of what it was pre-coronavirus, and his daily routine has changed substantially. Some days, he’s told to stay home if there isn’t enough cargo to drive. When he does get the call to come in, he arrives an hour later because the entire port basically shuts down for 60 minutes of deep cleaning between the morning and night shifts. Lysol and hand sanitizer are everywhere. Almost everyone is wearing a mask. He told his son that he feels like a masked “Batman” villain. The chairs were removed from the break rooms after a few workers tried to hold a pizza party there.
“Everyone is wearing their mask. Everyone is keeping their distance,” said Williams, a driver for Shippers Transport Express for 13 years. “It’s too early to call it normal. The work is there, but you see a lot of concern. Not exactly panic, but concern.”
The situation at the Port of Los Angeles is a case study of what’s ahead for the rest of the country when it’s eventually time to try to reopen. Restarting a business in this pandemic isn’t going to be easy. Businesses can’t just rehire everyone they laid off and return to 100 percent. It’s more akin to a rehabilitation process where business begins somewhere around 50 percent, economists say. From there, it depends on safety and customer demand.
Opening up the economy is likely to happen in waves. Some sectors such as construction and manufacturing are likely to restart faster than restaurants, hair salons and concerts that involve more human contact and will need time to sort out safety measures. For months to come, business efficiency will be sacrificed by putting in place necessary health measures.
The reopening will also depend on consumers feeling safe enough to venture out. That is also likely to happen in waves. Older Americans and those with underlying health conditions are going to need more assurances before they travel widely again.
Nearly all economists agree that widespread testing or some sort of vaccine will be necessary to truly get the economy back to normal levels, so people can feel safe to go out to restaurants, concerts and baseball games, as consumers rev up the nation’s economic engine, as they did before.
“Testing needs to pick up. That will allow us to keep the spread of the virus down by finding carriers,” wrote Neil Dutta, head of U.S. economics at Renaissance Macro Research, in a note to clients. “We can’t open the economy if every person that gets the virus is still spreading it to five people."
But before a vaccine is found, expect a transition period. The government is likely to give its blessing for firms to try opening up if they take serious preventive measures, similar to what many grocery stores are doing by limiting the number of people in the store.
This zombie — or limbo — economy is what the Port of Los Angeles is currently living through. Some ships are back, but not all. Some workers are back, but not all. New procedures are in place, especially for how to tie cargo down in a world of social distancing. And a Navy hospital ship, the USNS Mercy, is currently docked in the port, a reminder of just how far from normal everything is.
Gene Seroka, the port’s executive director, predicts it could be at least a year before volumes return to pre-coronavirus levels. Volume was down 31 percent in March. He isn’t predicting an April rebound.
“I believe we will continue to see a knock on effects of ill-advised trade war with China and covid-19 for the remainder of 2020 and maybe even into 2021,” Seroka said.
Many economists agree with Seroka that it will be a long time before the nearly 17 million Americans who have lost their jobs or seen dramatic cutbacks in hours are all back at work. The latest National Association for Business Economics survey of leading economists released Monday predicts the official unemployment rate will hit 12 percent this spring and fall only to 9.5 percent by the end of the year. That means many months without work for millions of Americans.
Nicolasa Huerta, another driver at the Los Angeles port, has not been as fortunate as Williams. She is lower in seniority and has barely received any calls to drive in April. “Some just don’t make it,” she said.
The big fear is that reopening the economy too early will trigger another spike in coronavirus cases and deaths, a nightmare health situation and an even longer lasting blow to the economy.
There are already warning signs of this, as at least 41 grocery workers have died of covid-19, the illness caused by the coronavirus, and some meat processing plants have had to shut down as the virus spreads quickly in places where workers are in close contact with each other.
Three workers at a Pilgrim’s Pride poultry processing plant in Harrisonburg, Va., have tested positive for the coronavirus, according to an employee at the plant who spoke on the condition of anonymity out of fear of retribution. The plant continues to operate. There are plastic shields between workers now, but masks have not been given out, the worker said.
Pilgrim’s Pride spokeswoman Nikki Richardson said “team member health and safety remains our top priority” and that the company was doing extensive cleaning and checking workers’ temperatures at its facilities. But parent company JBS recently announced the closure of its Greeley, Colo., beef facility after dozens of workers fell ill with coronavirus there.
Governors have faced a lot of backlash over their decisions about which businesses are “essential” and which must remain closed. It’s going to be equally tricky to make calls about which businesses can try to reopen and under what conditions.
Proposals are floating to allow restaurants and airlines to open at 50 percent capacity where every other table or seat is filled. But ultimately, there will need to be guidance on proper security measures, many business owners and experts say.
“We won’t have physical distancing one day and then the next day, it is over. There will be a transitional period,” said Leonard Marcus, co-director of Harvard National Preparedness Leadership Initiative.
Kevin Varner has run the Hunter-Gatherer Brewery in Columbia, S.C., for 25 years. Before the pandemic, he only closed once for a wedding and during massive hurricanes. Even in 2015, when a hurricane slammed the city with historic rainfall, he opened quickly. He used the big vats he normally makes beer in to boil water for the town.
This time is different. There are so many unknowns. His biggest fear is the government leaving it up to business owners to decide whether to open again. Varner is a beer expert. He’s brewed every batch of beer since he began. He’s not an epidemiologist. He tried to take precautions when he first heard about covid-19. He installed devices to open doors by foot and set out hand sanitizer, but he can only do so much.
“I would assume we will be one of the last industries to reopen,” Varner said. “None of us have any idea whether we’ll open at a limited capacity of 50 percent or 10 percent.”
For now, Varner is awaiting a Small Business Administration loan and trying to think through different scenarios, like reopening his larger brewery location that has outdoor seating and possibly keeping his other location, a smaller alehouse, shut. But he has no idea how much demand there will be.
To get most customers back, they’re going to have to “feel comfortable because of testing or because there are better treatments,” he said.