New lockdowns to hurt already hard-hit sectors

    602
    Business owners protest to remain open despite state-mandated restrictions after high case rates placed San Diego county in the most restrictive “purple” tier during the outbreak of COVID-19 in San Diego, California. (Reuters Photo)

    SAN FRANCISCO – The surge in new COVID-19 infections is driving a fresh wave of restrictions in cities and counties across the United States.

    California’s “emergency brake,” Oregon’s “freeze,” Philadelphia’s “safer at home” and Minnesota’s “dial back” are among a new patchwork of rules adopted by states, cities and counties that are much less strict and far more narrow than measures imposed to stop the spread of the virus in the spring.

    The overall economic bite will be smaller, too, compared to the downdraft that started earlier this year and which led to roughly 22 million people losing their jobs, a collapse in retail spending and a recession.

    “I don’t see where you get a 30 percent hit to GDP,” said Tim Duy, an economics professor at the University of Oregon. “There’s not as much to take off the table … I’m having a hard time seeing where you are going to derail the recovery.”

    Businesses that were fully shut in March, like medical offices, shops, factories, and even hair salons, will remain open in many areas this time around.

    That’s in part because many Americans have changed their behavior, businesses from manufacturers to retail stores have added routine temperature checks, and face masks are more common and in many states mandated. Meanwhile, consumers have embraced online shopping and curbside delivery to keep spending.

    Many of the latest restrictions target activities where science shows the spread of the virus is the most pernicious – indoor pursuits, in close quarters, for extended periods of time, or with heavy or unmasked breathing.

    That means they will hurt some already hard-hit sectors of the economy, including hospitality and entertainment. The US Centers for Disease Control and Prevention issued a strong recommendation against travel over the Thanksgiving holiday this month, though it did not ban it outright.

    Many of the more than two dozen states that have issued new restrictions this week have closed or restricted indoor dining and gyms. California, the biggest state by economic output, is among that group.

    At the same time, businesses shut during California’s lockdowns in the spring, including shopping malls, body waxing venues, and barber shops, can continue to operate, albeit with some limits to contain the spread of the virus.

    Philadelphia’s ban on indoor dining goes into effect on Friday.