Ohio BWC Delivered Nearly $8B in Dividends to Business in 2020

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: The European Central Bank will buy €500B bonds in a fresh stimulus.
• U.S.: While household net worth hit a new record of $123.5T in Q3, nearly four million Americans have stopped working or looking for jobs as the U.S. labor force is 2.2% smaller than February.
• Ohio: 16 projects set to create 4,183 new jobs were approved at the December Ohio Tax Credit Authority meeting. Over $170M in federal support awarded to 11 companies to support high-speed internet service in Ohio.

Global

Global food commodity prices rose sharply in November to their highest level in nearly six years and an estimated 270M people stand on the brink of starvation according to the head of the UN’s World Food Program. Global pressure on wages from COVID-19 will not stop with the arrival of a vaccine, the head of the International Labour Organization (ILO) warned, coinciding with a report showing how the pandemic slowed or reversed a trend of rising wages across the world, hitting women workers and the low-paid hardest.

The Bank for International Settlements reports that the U.S., EU, and Japan could face a ‘98% economy’ in the years ahead, with output returning to at best 2% below its pre-crisis trend. Output of customer-facing service industries is projected to remain between 10-20% below its pre-crisis trajectory for several years. The European Central Bank launched a fresh burst of stimulus to help the eurozone economy recover from the coronavirus pandemic, promising to buy €500B more bonds over a longer period and providing funding for banks.

U.S.

The U.S. economic recovery is likely to slow further before the impact of expected approvals of COVID-19 vaccines makes itself felt in Q2 2021. Weekly initial claims for jobless benefits rose by 137,000 to a seasonally adjusted 853,000 in the week ended December 5 – the highest level since September but still well below the peak of nearly 7M in late March. The U.S. labor force is 2.2% smaller than in February, a loss of 3.7M workers.  Household net worth rose 3.2% in the third quarter from the second quarter to $123.5T. Household debt rose 5.6% to $16.4T, its fastest pace in at least two years. Nearly 12M renters will owe an average of $5,850 in back rent and utilities by January. U.S. FDA Vaccines & Related Biological Products Advisory Committee, a panel of outside experts, voted in favor of endorsing emergency use authorization for the Pfizer BioNTech COVID-19 vaccine. With regards to PPE, the federal government has fallen short of its goal to shore up an emergency stockpile of respirator masks and some other personal protective equipment for health workers.

U.S. restaurants and retailers lost over 50,000 jobs in November as the employment recovery slowed during the month amid rising COVID-19 cases and new restrictions in several states. Customer transactions at major restaurant chains improved slightly in November. Across all restaurants, off-premises transactions increased 21% compared to the same period a year ago. Despite this, 58% of chain and independent full service restaurant operators expect continued furloughs and layoffs for at least the next three months. Delivery, warehousing and trucking operators added a combined 131,400 jobs last month as businesses restocked inventories and ramped up e-commerce capabilities to meet surging online demand on expectations for an unprecedented holiday-season rush. Investors are piling into wagers on industrial metals like copper and nickel, betting that coronavirus vaccines and stimulus programs will drive a boom in manufacturing activity as part of a global economic resurgence.

Ohio

16 projects set to create 4,183 new jobs were approved at the December Ohio Tax Credit Authority meeting. Over $170M in federal support awarded to 11 companies to support high-speed internet service in Ohio. Ohio Representative Marcia Fudge is President-Elect Biden’s Pick to lead the U.S. Department of Housing and Urban Development.

Ohio will begin distributing the first batch of the COVID-19 vaccine developed by Pfizer next week. Ohio BWC began issuing $5B in dividends to Ohio employers on Thursday to ease COVID-19’s impact on the state’s business community and economy, bringing its total dividends this year to nearly $8B. New unemployment benefits claims last week jumped by more than 30% over the previous week to more than 36,000 claims, the highest level since last spring. Continued jobless claims also rose by nearly 6%.

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.