Overview of the Economy

THE NEW (POST PANDEMIC) NORMAL

The focus of regional economic development has shifted considerably since CEDS 2017. CEDS 2017 focused on the transition from manufacturing-focused industries and jobs to a knowledge-based and innovation focused economy using technology-led economic development practices. CEDS 2017 also referenced continued recovery from the Great Recession.¹ In March 2020, the phrase ‘Covid-19’ entered the lexicon and the world quieted due to a world-wide pandemic. The pandemic exposed serious and substantial racial, gender and income inequality and occurrences of social injustice which has since shifted local and national economic development priorities. For example, the EDA’s investment priorities now include:

  • Equity
  • Recovery and resilience
  • Workforce development
  • Manufacturing and technology-based economic development
  • Environmentally sustainable economic development
  • Exports and direct foreign investments

As a result, seCTer too has moved to modify key activities and alter the focus of the region’s strategic goals and activities in the post pandemic period, the “New Normal.”

The pandemic amplified regional challenges that have been themes in prior CEDS: housing equity and supply; vulnerability of hospitality industry and service workers in general; and the need for wrap-around services to support the regional workforce. The threat of exposure to Covid-19 was greater to service and healthcare workers as they were not able to work remotely, a benefit afforded to those working in professional and technical jobs. The exposure risks and other pandemic-related challenges many workers could not overcome helped fuel the so-called “Great Resignation,” which combined with an aging workforce has resulted in the tightest regional and national labor markets seen in years.

Despite labor shortages, inflation and lingering supply-chain issues, many people are still starting new businesses. And some of the pandemic-related challenges were met by innovation and technology. The adoption of synchronous online meeting technologies, such as Zoom, allowed municipalities to continue to conduct business, provide services and engage with the public and constituents. The internet also helped businesses gain access to much-needed information regarding pandemic relief funds and other critical information. Many homeowners in rural and suburban areas took advantage of the pandemic-fueled demand of city dwellers seeking more rural/less urban settings to sell their homes at considerable profit, while contractors and tradesmen benefited from a surge in home renovations for home offices.

People rediscovered the outdoors, public parks experienced historic attendance, and the sale of boats and recreational vehicles skyrocketed. Businesses had unparalleled access to capital through robust pandemic relief funding made available during and after the pandemic, which should help new business starts and existing businesses to grow, expand and become more resilient for years to come.

There is much work to do, however. Attention must be directed to regional and local levels when talking equity, inclusiveness, capacity and resilience. Decision-making organizations, agencies, elected officials and policy-makers members must reflect the diversity of age, ethnicity, income and gender found in the towns and region they serve. Only through industry

diversification, alignment behind a common vision, coordinated collaboration to systematically remove barriers to equitable access and participation in the economy, and improved response readiness to future disruptions will the region become more resilient. A way to reinforce success while supporting areas in need must be found.

While the pandemic shuttered schools and businesses and disrupted lives, leaders in the SECT EDD met with increased frequency and urgency and collaborated in new ways. Traditional meetings and modes of communication were no longer as effective or convenient as before. Through a period of trial and error, EDD’s leaders gradually discerned that new and expanded partnerships were needed to steady the region. Small, highly reactive and proactive groups became important for sharing best practices among economic development professionals and their partners. New focus areas became critical. Moving the region’s economic development (and, at the time, economic preservation) forces in the same direction was imperative. Alignment of organizations was central to restoring efficient and effective economic activity.

The pandemic amplified regional challenges that have been themes in prior CEDS: housing equity and supply; vulnerability of hospitality industry and service workers in general; and the need for wrap-around services to support the regional workforce. The threat of exposure to Covid-19 was greater to service and healthcare workers as they were not able to work remotely, a benefit afforded to those working in professional and technical jobs. The exposure risks and other pandemic-related challenges many workers could not overcome helped fuel the so-called “Great Resignation,” which combined with an aging workforce has resulted in the tightest regional and national labor markets seen in years.

Despite labor shortages, inflation and lingering supply-chain issues, many people are still starting new businesses. And some of the pandemic-related challenges were met by innovation and technology.  

The adoption of synchronous online meeting technologies, such as Zoom, allowed municipalities to continue to conduct business, provide services and engage with the public and constituents. The internet also helped businesses gain access to much-needed information regarding pandemic relief funds and other critical information. Many homeowners in rural and suburban areas took advantage of the pandemic-fueled demand of city dwellers seeking more rural/less urban settings to sell their homes at considerable profit, while contractors and tradesmen benefited from a surge in home renovations for home offices.

People rediscovered the outdoors, public parks experienced historic attendance, and the sale of boats and recreational vehicles skyrocketed. Businesses had unparalleled access to capital through robust pandemic relief funding made available during and after the pandemic, which should help new business starts and existing businesses to grow, expand and become more resilient for years to come.

There is much work to do, however. Attention must be directed to regional and local levels when talking equity, inclusiveness, capacity and resilience. Decision-making organizations, agencies, elected officials and policy-makers members must reflect the diversity of age, ethnicity, income and gender found in the towns and region they serve. Only through industry diversification, alignment behind a common vision, coordinated collaboration to systematically remove barriers to equitable access and participation in the economy, and improved response readiness to future disruptions will the region become more resilient. A way to reinforce success while supporting areas in need must be found.

While the pandemic shuttered schools and businesses and disrupted lives, leaders in the SECT EDD met with increased frequency and urgency and collaborated in new ways. Traditional meetings and modes of communication were no longer as effective or convenient as before. Through a period of trial and error, EDD’s leaders gradually discerned that new and expanded partnerships were needed to steady the region. Small, highly reactive and proactive groups became important for sharing best practices among economic development professionals and their partners. New focus areas became critical. Moving the region’s economic development (and, at the time, economic preservation) forces in the same direction was imperative. Alignment of organizations was central to restoring efficient and effective economic activity. 

¹ The Great Recession began in December 2007 and ended in June 2009, making it the longest recession since World War II. In addition to its duration, the Great Recession was notably severe in several respects. Real U.S. gross domestic product (GDP) fell 4.3 percent from its peak in 2007Q4 to its trough in 2009Q2, the largest decline in the postwar era (as of October 2013). The U.S. unemployment rate, which was 5 percent in December 2007, rose to 9.5 percent in June 2009, and peaked at 10 percent in October 2009. As late as November 2013, the unemployment rate remained at 7.3 percent. Even with a federal funds rate of zero percent and additional efforts by the Federal Reserve to stimulate that national recovery, the recovery in late 2013 was characterized as “slow and grudging” (“The Great Depression” at The Great Recession | Federal Reserve History).