Goleta-based economist Mark Schniepp said March 17 that even though the pandemic-ravaged economy is gradually bouncing back, there is no idea when things might return to what might be considered normal.
“The goal posts keep moving,” he said, referring to the on-again-off-again restrictions on businesses.
Schniepp, head of the California Economic Forecast Project, told an online audience that the latest recession might be over, but 9.5 million people aren’t working – and some 800,000 may not return to full employment.
As restaurants, gyms and personal service businesses started to re-open this week, Schniepp said “normal” may not occur until September, or later.
While saying, “We are out of the ‘dark winter,’” California and some other states may be facing another surge in COVID-19 cases that may bring back restrictions.
“We desperately need a drink,” Schniepp quipped.
Along with current business restrictions, large gatherings and school attendance still face limits. The future of travel is unknown, Schniepp said.
Santa Barbara County lost some 20,000 jobs in the past year. Retail sales are down 19 percent in California, he said. On the brighter side, residential real estate is “red hot” and companies such as Amazon and Apple are doing well, Schniepp said.
Even though many employees work from home, 40 percent returned to their offices by December. Many employers wanted them back because of productivity issues, he said.
Companies such as technology and professional services firms will need office space, Schniepp said.
The real gross domestic product will gradually rise. However, Schniepp said he’s not hopeful government will remove all business restrictions soon. Recently issued stimulus payments might cause inflation, “but it may not be that bad,” he said.
Schniepp was a panelist at the Radius Real Estate & Economic Update Q1 2021. Also speaking was Radius’ Brad Frohling who said he doubts more housing will be developed above commercial properties on State Street because it’s too expensive to convert the buildings for residential use.
Frohling also said he favors reopening part of what is now called the State Street “promenade” and only keeping the corridor closed from Haley Street to De la Guerra Street.
Posted March 18, 2021.