Waymo opening new autonomous vehicle testing site in Ohio

This report is a summary of third-party economic research and perspectives to foster communication with business and economic development stakeholders during the COVID-19 crisis.

Key Takeaways

• Global: OECD expects global economy to return pre-pandemic levels by the end of 2021.
• U.S.: Goldman Sachs projects U.S. GDP will grow at a 5.3% pace in 2021.
• Ohio: Waymo opening new autonomous vehicle testing site in Ohio.

Global

The U.K. became the first western country to approve a COVID-19 vaccine, with its regulator clearing the  Pfizer-BioNTech shot ahead of decisions in the U.S. and EU. The Organization for Economic Cooperation and Development revised its economic outlook over the coming two years as it expects global real GDP to reach pre-pandemic levels by the end of 2021 thanks to progress with vaccines and unprecedented government and global bank action. The updated forecast now expects the global economy to contract 4.2% this year and grow 4.2% in 2021. An additional 207M people could be pushed into extreme poverty by 2030, due to the severe long-term impact of the pandemic, bringing the total to more than a billion, according to UNDP.

U.S.

Total nonfarm payroll employment rose by 245,000 in November, and the unemployment rate edged down to 6.7%, the U.S. Bureau of Labor Statistics reported Friday. First-time claims for unemployment benefits totaled 712,000 last week, compared to 787,000 a week earlier. The system for providing unemployment benefits to jobless workers has consistently produced inaccurate data and lower-than-appropriate payouts to millions of workers, accordingly to Government Accountability Office. Unemployment data might have overstated the health of the labor market as the U.S. labor force is 2.2% smaller than in February 2020.

JPMorgan sees an economic contraction in Q1 2021 due to the spreading coronavirus and related restrictions being imposed. Goldman Sachs projects U.S. GDP will grow at a 5.3% pace in 2021, ahead of the consensus around 4%. The Conference Board says U.S. economy will return to pre-pandemic levels in October 2021. On December 31, several novel Fed programs that have backed corporate credit and municipal-borrowing markets and provided loans to small and midsize businesses and nonprofits during the pandemic will end.

The November Manufacturing PMI registered 57.5%, down 1.8% from the October reading of 59.3%. The Conference Board’s reading on consumer confidence in November unexpectedly fell to 96.1 from a reading of 101.4 in October. Investment in the food technology space for the first three quarters of 2020 is $8.4B, which outpaced the $7B raised during all of 2019. General Electric warned employees that more job cuts are coming to the conglomerate’s jet-engine business because of the pandemic’s impact on commercial air travel.

McKinsey found that about three out of four people have tried a new shopping method due to the coronavirus and that more than half of all consumers intend to continue using curbside pickup and grocery-delivery services after the pandemic is over. Nearly 70% of consumers intend to continue buying online for store pickup. Road trip travel over Thanksgiving was down 35% from last year for the nation and down 52% for Ohio.

COVID-19 patients in hospitals passed 100,000 for the first time as medical facilities are expected to come under unprecedented stress this winter. Los Angeles issued one of the strictest stay-at-home orders in the country. COVID-19 vaccines awaiting regulatory approval will require ultracold temperatures for shipping and storage, and makers of dry ice are bracing for a surge in demand. CVS Health and Walgreens are preparing to administer vaccines in upwards of 50,000 nursing homes and assisted-living facilities across the country.

Ohio

The Federal Reserve’s Beige Book reported that the Cleveland district observed, “Economic activity increased moderately, and staff levels increased slightly. Firms connected to IT, housing, and consumer durables fared better than those connected to travel, energy, and hospitality. Supply chain constraints boosted transportation costs and prices for certain construction and manufacturing inputs. Contacts expected a modest improvement in activity, but hiring plans were restrained because of the pandemic’s uncertain path.”

Ohio is preparing to receive its first shipment of Pfizer COVID-19 vaccines around December 15, and another shipment of COVID-19 vaccines from Moderna may ship by December 22.  Ohio State is well-positioned to help boost central Ohio economic development.  Ohio State President Kristina Johnson said the university is a force for research, innovation and entrepreneurship. She pointed to the nearly $1B in research expenditures in fiscal year 2020, which yielded 367 invention disclosures and 13 startups.  Brent Spence Bridge repairs halfway complete.

Resources

• Ohio Department of Health’s COVID-19 Website: coronavirus.ohio.gov
• JobsOhio’s resource portal and information about Open, Secure Supply Chains in Ohio.