President Trump’s economic response to COVID-19 through massive tax and financial incentives was expected to lead to a V-shaped recovery on the eve of the election. We noted that from the very beginning chance of a snowball in hell that economic growth will return to the level of 2019 at the end of this year; however, the labor market will fully recover.
If readers remember, President Trump gave several press conferences at which he stated that the economy is recovering fast: “We talked about V,” the president said. “It’s better than V. It’s a rocket ship.”
New report through Yelp, tilted “Report on local economic impact” exposes the V-shaped narrative and talks about a completely different story of slow discoveries and ubiquitous permanent closures; all this suggests that economic devastation continues to destroy the economy without recovery in sight.
Yelp data show that large numbers of Americans remain in deep recession until mid-June. Since April 19, only 20% of the 175,000 stores registered with Yelp have opened, which were closed during the block.
“As of June 15, nearly 140,000 enterprises were closed at Yelp from March 1. In April, we reported more than 175,000 closures of enterprises, indicating over 20% of businesses closed in April reopened,
“Las Vegas, Nevada, survived the largest number of closures relative to the number of businesses in the city (1921 total closures), while Los Angeles, California had the largest total closures (11,774 closures). ”
The screech makes a shocking statement: “Of all business closures at Yelp since March 1, 41% are permanent closures. ”
“Our data show that the biggest bursts of constant closures occurred in March, and then in May and June, which indicates that enterprises that were already struggling should close immediately and businesses that tried to hold on but failed to weather the COVID-19 storm were forced to close in recent months. ”
Of the businesses that closed operations, restaurants and shops / retail sales led to the most permanent closures.
“Among those with the highest level of business closure is purchases and retail (27 663 closed enterprises), restaurants (23 981 closed enterprises), cosmetics (15 368 closed enterprises) and fitness (5 589 closed enterprises).
“Retail has been hit hardest the largest number of all closures is observed, while the average daily indicator has continued to grow since March. Of all closures on Yelp from March 1, 20% are for retail businesses, and 35% of closed retail businesses are listed as permanent at Yelp.
“In March, Restaurants had the largest number of business closures compared to other industries, and continued to close at high rates. Of the closed businesses, 17% are restaurants, and 53% of these restaurant closures are reported as permanent at Yelp. Restaurants operate with low margins and can sometimes take months or even years to break even, resulting in higher levels of permanent closures. ”
All this means that recovery is losing steam. This summer, consumer spending will decline again as the payroll program and other incentives have already begun to develop. Without recovery, more business closures / probably more permanent closures and increased jobs ahead.
Worse yet, the virus pandemic rebornAs a result, states such as Florida, Texas, and California canceled the discovery, which would put additional pressure on the business.
Readers should read our latest articles on the serious economic damage that is destroying the economy and how recovery cannot be seen until 2023:
By now, readers should understand that the deep economic scars caused by the use of COVID-19 will have long-term consequences and a recovery that will come in a few years.