As of now the economy is in a state of flux, according to Ali Wolf, chief economist at Zonda, during the latest COVID-19 Update webinar. The stock market is moving up and down, consumer confidence has fallen to a seven-month low, worries about inflation are rising, and the specter of potential government shutdown has loomed over the past week.
“The biggest question on the economic front is, where do we go from here?” says Wolf. “There’s so many moving parts. There’s good news, we’re growing. There’s bad news, there’s uncertainty, there’s volatility. For any of us trying to forecast, how do you make sense of it?”
While Wolf expects the economy to continue to grow, her prediction is that the pace of that growth will decelerate. The apparent end of stimulus checks also signals the end of the “blockbuster numbers” associated with a large economic cash flow. And job recovery is expected to come in “fits and starts,” with a full recovery expected within 14 to 18 months. Risks include the influence of federal policy, the emergence of variants, inflation, and access to labor.
Nonfarm payroll employment, which rose steadily by almost a million jobs per month at the beginning of the summer, only rose by 235,000 jobs in August—a drop attributed to the delta variant surge. Professional and business services led employment growth, while leisure and hospitality, which had been growing, remained unchanged in August.
Total nonfarm payroll numbers are still down by 5.3 million workers from March 2020. Wolf notes that residential is near fully recovered, up almost 80,000 workers since February 2020, with 320,000 job openings in the construction sector.
Read More
