As the Washington region tries to pull out of the most severe economic slump in most of our lifetimes, the biggest challenge is defeating the novel coronavirus so our work lives can return to something like normal.
From April to June, our area’s job loss from a year ago averaged 9 percent, compared to 11 percent nationwide. We’re protected, a little, because the federal government — our largest employer — is still chugging along.
The region had “unprecedented [jobs] decrease — it’s just less than what has happened elsewhere,” George Mason University economist Jeannette Chapman said.
To have a full rebound, the public must be confident that it’s safe to resume normal economic activity.
Until then, here are six obstacles that the region needs to overcome. They are listed in roughly descending order of importance, according to what Chapman says is the share of the regional economy affected.
●Child care. About 4 out of 10 working households in the metro area have children, and most school systems are planning to offer only online learning at the start of the school year. Even school systems that allow in-person learning, such as Fairfax and Loudoun, are doing so for just part of the week.
That means a large share of workers have to devote much of their time to attending to children. Either they can’t return to work at all, or their productivity is reduced.
“If kids don’t go back to school, business doesn’t go back to work,” said Julie Coons, president of the Northern Virginia Chamber of Commerce.
Meanwhile, day-care centers are losing slots or going under. Few have enough space to serve as many children as in the past, given the need for physical distancing. Many can’t afford to reopen.
“Their financial situation is very precarious right now,” said Yesim Sayin Taylor, executive director of the D.C. Policy Center.
●Federal relief. The region’s economy, like the nation’s, will suffer if Congress and the White House fail to provide substantial fresh aid in the next virus relief package, analysts say.
It’s especially important that federal unemployment insurance payments are extended beyond the current cutoff of July 31. The additional $600 a week has provided a significant cushion.
State and local governments also need more aid, because the coronavirus shutdowns have ravaged their tax revenue and other income.
Congress is “going to have to deal with unemployment insurance, because the states can’t do it themselves,” said Georgette “Gigi” Godwin, president of the Montgomery County Chamber of Commerce. She would also like to see a big federal investment in infrastructure, such as transportation and broadband.
“It would put people back to work,” Godwin said. “We need all kinds of infrastructure funding in the Washington region.”
Prospects for such stimulus are uncertain. The Democratic-controlled House has passed a $3 trillion bill, but Senate Republican leaders oppose many of its measures and President Trump threatened to veto it. The White House recently said any relief package must include a payroll tax cut, a measure resisted by many in Congress from both parties.
●Small-business closures. Government shutdowns and public wariness have devastated sales for small businesses that rely on face-to-face interaction with customers, such as restaurants, retail shops, gyms and salons.
Many earned small profit margins before the pandemic and cannot survive in the new economic climate.
“In the long run, small businesses are engines of job creation, but they’re also engines of job destruction,” said Taylor, with the D.C. Policy Center.
The city of Fairfax is offering cash grants and other support to help such enterprises, but recovery ultimately will depend on “the public at large being comfortable going out, shopping, being next to each other,” said Danette Nguyen, the city’s assistant director of economic development.
For now, she said, “the public at large is just not ready to eat indoors.”
●Mass transit. The public’s reluctance to risk their health by crowding into subway cars or buses is a drag on the economy. Before the pandemic, about 14 percent of households in the region relied on transit to get to work.
“Safety [on Metro] used to mean, ‘Do the trains run safely?’ ” said Godwin, with the Montgomery chamber. “Now we have the added questions of how is covid-19 mitigated in Metro cars, and all the things you touch as you go in and out.”
Since the pandemic began, Metro has seen a 90 percent drop in rail trips and a nearly 70 percent decline in bus trips. It has reduced service as a result.
Metro officials plan to announce Monday that most service will be restored in the second half of August, but they expect the public to be slow and cautious about returning.
About half the region is able to work from home, which is the second-highest rate in the nation among metropolitan areas, behind only Silicon Valley, according to a University of Chicago study. But that still leaves hundreds of thousands who commute.
●Evictions. Many households have fallen behind on rent after losing jobs or income, but they are still in their homes because of emergency measures including temporary bans on evictions. As evictions resume, however, analysts expect a wave of ousters that will increase homelessness and lead to other disruptions.
“When courts are flooded with eviction notices, then we’ll have a tragedy,” Taylor said.
The District’s moratorium on evictions was effectively extended until December. A Virginia moratorium expired last month, although some courts have delayed processing evictions at the request of Gov. Ralph Northam (D). A Maryland court stay on eviction proceedings is scheduled to be lifted later this month.
●Job retraining. In business sectors such as restaurants and retail, many jobs are expected to disappear as companies go under or consumers switch to online shopping. That means people need to be retrained for jobs of the future, such as in information technology and health care.
GMU’s Chapman said about 150,000 people have lost jobs in our region in the hard-hit hospitality and leisure industries.
“Even if half of them come back in the next six months, we are still left with a large number of workers who don’t have an industry to go back to,” she said. “Retraining is really the only way to retain those workers, because there are no other options for them in this region.”
The Northern Virginia Chamber of Commerce has made it a priority to encourage the state government to preserve job-training programs even when its budget is strapped. Analysts say companies, community colleges and universities also should expand retraining projects and curriculums.
Said Coons, the chamber president: “There needs to be a realization that investment in workforce is going to be super important to getting everybody back to work.”
Coronavirus news in D.C., Virginia and Maryland
The latest: More than two years into the pandemic, covid cases in the D.C. region are rising again, , while liberal Montgomery County asks who deserves credit for its robust covid response. Meanwhile, Black funeral directors still face a daunting amount of deaths from covid and the omicron wave has had an unequal toll in the DMV.
At-home tests: Here’s how to use at-home covid tests, where to find them and how they differ from PCR tests.
Mapping the spread: Tens of thousands have died in the local region and nationwide cases number in the hundreds of thousands.
Omicron: Remaining covid restrictions in the D.C.-area, plus a breakdown of variant symptoms and mask recommendations.
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