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Shutdowns or virus: which caused the drop?

New study out of Indiana University.  Economists have researched the pandemic, social distancing, and employment, and revealed four key facts.

  • Unemployment and activity declined before shutdowns hit
  • The virus itself caused a massive drop in activity. Shutdowns caused an additional small decline.
  • When the shutdowns lifted, activity did not spring back
  • The jobs data does not show a large red-blue divide.

Gartner’s research shows that 2020 dipped 3.2% in tech investment.   Projections are for 6.2% growth from last year.   Remote work investment will be up 4.9%, per the report.

Why do we care?

The virus and the public reaction to it caused the economic slow down, not shutdowns.    Thus, to see the economy come back, the virus needs to be eliminated.

Here’s the wrinkle.  Vaccination is not necessarily enough.  As I dig into the research there, being vaccinated does not mean individuals are not transmitting the disease. Getting to enough of the population vaccinated means the virus stops spreading, which drives THEN recovery.   That means the metric we care about is vaccine rollout.   That is what bodes for recovery.

Source: The Washington Post

Source: CIO Dive