Earlier I posted some questions for next year: Ten Economic Questions for 2021. I’m adding some thoughts, and maybe some predictions for each question.
10) Economic Scarring: Some sectors were hit especially hard during the pandemic, like travel (hotels, airlines, cruise ships), and entertainment (restaurants, theaters, concerts). Also some areas of Commercial Real Estate (retail, hotels, offices) might suffer long term damage. How much damage did the pandemic do to certain sectors?
The pandemic will likely cause some medium to long term economic scarring. As an example, the lack of in person education for part of the year, might slow learning for many children. But that is beyond the scope of this question – I’m focused on the impact on the 2021 economy.
If we could flip a switch, and end the pandemic today, there would be certain sectors that would still have problems. And the end to the pandemic will probably be more like a dimmer switch, and slowly fade away in Q2 and Q3 (we hope).
Click on graph for larger image.
This graph shows the Architecture Billings Index since 1996. The index was at 46.3 in November, down from 47.5 in October. Anything below 50 indicates contraction in demand for architects’ services.
Here are the Ten Economic Questions for 2021