Industry Impacts of Coronavirus (COVID-19)

The impacts of coronavirus and COVID-19 continue to be felt differently across various industries. During resulting quarantines, some industries have seen a rise in demand and a push to be deemed “essential” for local, state, and national governments, while other industries have experienced a decline in demand or have struggled to survive numerous shutdowns and shelter-in-place orders.

Data is updated on a regular basis, so check back frequently to get the most up-to-date information.

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July 1, 2021

  • The post-COVID revival quickly boosted demand for marketing- and sales-related services, according to marketing technology news site MarTech. People who lost their jobs in the pandemic started their own business and are hiring marketers to help them distribute their product and services in the post-pandemic, largely digital world. The trend is in line with the sudden outburst of remote jobs, freelancing gigs, and business offshoring trends in recent months, according to MarTech.
  • Procter & Gamble, world’s largest advertiser, increased marketing spending by $270 million in Q1 compared to the prior quarter, according to research consultancy COMvergence. The increase is in line with how P&G has managed its ad spending throughout the pandemic; making cuts in some areas to fuel ad spending elsewhere. P&G is trying to balance growth, particularly as profitability swells, against sustainable marketing spending in a post-pandemic world, according to COMvergence.
  • Real disposable income, a driver of spending on advertising, decreased 2.8% in May following a  15.1% in April and a 22.7% increase in March. The decrease in personal income in May and April primarily reflected a decrease in government social benefits. Payments made to individuals from the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued in May, but at a lower level than in April. Unemployment insurance also decreased, led by decreases in payments from the Pandemic Unemployment Compensation program. Consumer spending was unchanged in May. Spending and income are expected to rebound in the coming months as more people become vaccinated.
  • Direct-to-consumer (D2C) sales growth has drawn the interest of advertising agencies. Boomn, Homestead Studios, Freelance Crew, and several other agencies are expected to launch in-house D2C brands in 2021. Industry experts expect agencies to focus on streaming and digital television to drive sales growth and new user acquisition for clients, as D2C brands have likely reached the point of diminishing returns on Facebook and other social outlets.
  • Local advertising will rebound along with the greater economy through 2021, according to the latest US Local Advertising Forecast published by BIA Advisory Services. BIA expects total local advertising expenditures to rise 2.5% year over year in 2021. About 22.7% of the increase is expected to come from direct mail and 17% each from mobile and online advertising. Local TV and radio round out the top five, accounting for 11.4% and 9.2% of the total, respectively.
  • Total advertising spending is expected to have declined 8% in 2020. Spending on traditional media that includes linear TV, out-of-home, standard radio, print, and direct mail is expected to have declined 30%.

July 1, 2021

  • The US Department of Agriculture (USDA) has begun releasing up to $44 billion for agriculture producers and businesses as part of the $6 billion Pandemic Assistance for Producers initiative created in March. A total of $11 billion has been allocated since January using available pandemic assistance funds and Tom Vilsack, USDA Secretary, says that more pandemic-related funding will be announced later in the summer along with the Build Back Better program.
  • The Energy Information Administration (EIA) maintained its reduced ethanol production forecasts for both 2021 and 2022 in its latest Short-Term Energy Outlook, released in June. The forecast for 2021 is now at 960,000 barrels per day (bpd), down from the 980,000 bpd estimate made in February. Ethanol production in 2022 is currently expected to average 990,000 barrels per day, down from the forecast of 1.02 million barrels per day made last month. Production averaged 1.03 million barrels per day in 2019 but was negatively impacted by the coronavirus pandemic in 2020.
  • Field trials of some agricultural chemicals have decreased during the pandemic, according to Agribusiness Global. Universities have been notifying companies that they will accept less field trial work due either to directives from university administration or the lack of field staff to conduct the work. It has been difficult for universities to get accepted trials done with the same degree of consistency and detail, as a large staff complement and student workers are required to get many of the daily tasks done. The student worker resource pool hasn’t been available due to pandemic-related issues.
  • The American Chemistry Council expects total US chemical exports to rebound in 2021 and grow 10.9%, but a full recovery to pre-pandemic levels is not expected before 2022.
  • Agricultural chemical industry employment increased 6% year over year in April, according to the US Bureau of Labor Statistics.

July 1, 2021

  • United Airlines announced on June 30 a massive new order for 200 Boeing 737 MAX and 70 Airbus A321neo aircraft. Analysts say that the big order is intended to revamp United’s single-aisle jet fleet and position the airline to grow with the expected surge in air travel as the COVID-19 pandemic downturn ends.
  • Prospects for the development of a digital COVID-19 vaccination passport became murkier after the Biden administration said that it will leave the task of developing digital health credentials up to the private sector. Many industry analysts say that widespread adoption of digital health credentials may boost demand for air travel, which would benefit aircraft engines and parts manufacturers. Many countries that have recently opened or plan to open their borders to foreign tourists require travelers to show proof that they are vaccinated against Covid-19 or proof of a recent negative Covid-19 test. No country has yet made digital vaccination passports a requirement.
  • GE Aviation expects maintenance shop visits, a driver of demand for parts, to be flat in 2021 compared with the prior year’s depressed level. Revenue from maintenance and repair work was down 43% in Raytheon Technologies' Collins Aerospace parts division and 35% in the Pratt & Whitney engine unit in early 2021. Boeing CEO David Calhoun called 2021 and the vaccine distribution a “key inflection point” but also warned of an uneven recovery.
  • The coronavirus pandemic has resulted in fewer planes sold, fewer flying hours, and older aircraft retiring early as fleets are pruned. Aircraft engine and part manufacturers, whose profits rely heavily on keeping aircraft running for years after they are sold, have been negatively impacted. Pratt & Whitney reported a 20% year-over-year revenue decrease for 2020. GE Aviation’s sales decreased 33% year over year in 2020.
  • Lockheed Martin plans to manufacture between 133 and 139 examples of its F-35 stealth fighter in 2021, a number about the same as 2019 levels, but below previous projections as the program continues to feel the lingering effects of the coronavirus pandemic. Lockheed Martin, which fell short of the 2020 goal to produce 142 F-35s, cited pandemic-related supply chain disruptions as a primary cause. It could take until at least 2023 for the manufacturer to catch up on the missed deliveries.
  • The US government is requiring travelers to show proof of a recent negative COVID-19 test before boarding flights to the US.
  • Robert Spingarn, investment bank and financial services company Credit Suisse's aerospace analyst, estimates that the active commercial airline fleet decreased 37% in 2020. Spingarn says that about 70% of the fleet that was flying at the end of 2019 could be brought back using only engines that won't need overhauls until 2023 or later.
  • Most of American Airlines' parked aircraft are in an "active parked state," which means the airline can call them back into service at any time. Aircraft maintenance doesn't stop, even when planes are grounded: "The whole process is designed around ensuring that when the aircraft comes back into the operation it's as safe and reliable as it was when it entered into that storage program," said Craig Barton, the head of technical operations for American Airlines. Demand for replacement parts may rise initially as idle planes provide an opportunity to complete maintenance routines, but may eventually fall if planes remain out of service for an extended period.
  • Boeing CEO David Calhoun said that the company plans to have 130,000 employees at the end of 2021, down from 160,000 at the beginning of 2020. Boeing had already announced that more than 19,000 employees would be leaving this year, according to The Associated Press.
  • Aircraft engine manufacturer Rolls-Royce said that the impact on the company of the coronavirus pandemic will last seven years.

July 1, 2021

  • Pandemic-related semiconductor chip shortages are now expected to lower global auto output by 3.9 million vehicles in 2021, or 4.6%, according to Time magazine. Ford alone expects to produce 1.1 million fewer vehicles, leading to a $2.5 billion earnings reduction.
  • Aluminum producer Novelis projects global aluminum demand to remain on a growth trajectory that will not be negatively impacted long-term by the coronavirus pandemic. The company expects demand for aluminum flat-rolled products to increase approximately 5% in 2021. Growth will be driven by increasing demand from automakers and aluminum can producers.
  • Aluminum manufacturing industry employment increased 4.2% from the pandemic-related low of April 2020 but was down 7.3% from the pre-pandemic level of April 2019, according to the US Bureau of Labor Statistics.
  • The Institute for Supply Management’s monthly Purchasing Managers’ Index (PMI) was 60.6% in June, a decrease of 0.6 percentage point from the May reading of 61.2%. This figure indicates expansion in the overall economy for the 13th month in a row after contraction in April 2020. The New Orders Index registered 66%, decreasing 1 percentage point from the May reading of 67%. The Production Index registered 60.8%, an increase of 2.3 percentage points compared to the May reading of 58.5%. The Prices Index registered 92.1%, up 4.1 percentage points compared to the May figure of 88% and the index's highest reading since July 1979 (93.1%). The Backlog of Orders Index registered 64.5%, 6.1 percentage points lower than the May reading of 70.6%. The Employment Index registered 49.9%; 1 percentage point lower compared to the May reading of 50.9%.

July 1, 2021

  • Demand for ambulance services may decrease if the number of COVID-19 cases continues dropping as vaccination rates increase. About 47% of the country's population has been fully vaccinated as of July 1, and 54% has received at least one dose of a COVID-19 vaccine as of June 5, according to the U.S. Centers for Disease Control and Prevention.
  • A Centers for Medicare and Medicaid Services (CMS) waiver authority included in the American Rescue Plan Act of 2021 authorizes reimbursement to ambulance services for treatment in place delivered to Medicare beneficiaries during the public health emergency. The Act also provides additional funding for the Provider Relief Fund for rural EMS.
  • The US Department of Health & Human Services (HHS) has renewed the Public Health Emergency (PHE) declaration for COVID 19 for another 90 days, beginning on April 21 (the date the PHE was previously scheduled to expire) and extending through July 19, 2021. Industry stakeholders should remember that HHS retains the discretion to terminate the PHE at any time.
  • The No Surprises Act included in the coronavirus stimulus package passed in December 2020 includes air but not ground ambulances. The Act, which took effect in January 2022, bans surprise medical bills in emergencies as well as those from out-of-network providers who treat insured patients at an in-network medical facility. Research published in 2020 found that 79% of all ground ambulance rides could result in an out-of-network bill. The study was based on a large national health insurer’s claims data from 2013 to 2017. Another study, published in 2019, found that 86% of ambulance rides to hospital emergency departments resulted in an out-of-network bill for patients with private insurance, a far higher rate than from other physician specialists encountered in an ER visit, including ER doctors and anesthesiologists.
  • The Department of Health and Human Services announced is providing $1.48 billion for ambulance services from the Provider Relief Fund. The $1.48 billion is an addition to the $350 million that ambulance services had received from the federal government since the beginning of the pandemic, for a total of $1.83 billion.
  • EMS personnel are at a higher risk of dying from COVID-19 than other healthcare or emergency services professionals, according to an analysis conducted for industry news site EMS1. Researchers estimate that the number of EMS personnel COVID-19 related deaths is about three times higher than that for nurses and about five times higher than that for physicians. EMS professional fatalities were highest in New Jersey (36% of fatalities), New York state (22%), and Pennsylvania (8%).

July 1, 2021

  • Medical experts are trying to determine when it’s safe for those who had COVID-19 to have elective surgery. Concerns about respiratory complications from anesthesia are a major factor, and covid may affect multiple organs and systems. Clinicians are still learning the implications of those issues for surgery. A recent study compared the mortality rate in the 30 days following surgery in patients who had a covid infection and in those who did not. It found that waiting to undergo surgery for at least seven weeks after a COVID-19 infection reduced the risk of death to that of people who hadn’t been infected in the first place. Patients with lingering covid symptoms should wait even longer, the study suggested.
  • Pandemic-related payments to the largest hospital chains may have accelerated their acquisition plans by enabling them to purchase weakened competitors. Ascension, for example, a large faith-based system that received more than $1 billion in aid, said in March that it was investing in a partnership to buy surgery centers. The company said, however, that its investment funding in surgery centers predated the pandemic. Congress provided capital to hospitals that did not need it, according to Zack Cooper, a Yale health economist. “Regulators should really be looking at the transactions occurring.”
  • Ambulatory surgery centers are reporting shortages of gloves, gowns, and blue sterile wrap that is most frequently used for instruments, kits, and trays. Adjustments include a combination of working with alternative vendors, ordering through multiple vendors, and deploying alternative practices like using more pans or switching to one-tray systems to reduce the amount of blue wrap that is needed.
  • The COVID-19 pandemic accelerated the move away from large traditional hospital institutions and expedited the move toward technology, telemedicine, and ambulatory surgery centers (ASCs), according to Elizabeth LaBouyer, RN, executive director of the California Ambulatory Surgery Association. The pandemic has likely accelerated even further the level of consumer acceptance for ASCs based on their desire to avoid hospital settings, she added. ASCs are working through a backlog of care in early 2021 and will rebound in the months ahead. They are likely to benefit from a lasting perception by both patients and physicians that ASCs don't pose the same risk of exposure to infection as a hospital setting.
  • Video-based post-discharge visits were noninferior to in-hospital follow-up in terms of the proportion of patients returning for a hospital encounter within 30 days of discharge after low-risk surgery at an ambulatory surgery center, according to a study completed at Carolinas Medical Center in Charlotte, NC. Moreover, the virtual visits were typically about a half hour shorter than the usual in-person visit but still provided patients with the same amount of time actually spent with their surgeons. The improvement in successful follow-up was accompanied by significantly greater satisfaction among participating nurses and no drop in patient satisfaction.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.
  • The Centers for Medicare and Medicaid Services (CMS) revised its guidance for allowing same-day, ambulatory surgical centers to temporarily certify as hospitals and provide inpatient care for periods longer than 24 hours before being required to transfer patients to an acute-care hospital. The update clarifies that ambulatory surgical centers need only to provide 24-hour nursing services when one or more patients are on-site instead of having nurses be present even when no patients are in the facility in order to achieve hospital certification. The actions are a response to reports from hospitals that they are running out of beds as a result of the surge in COVID-19 cases.
  • Ambulatory surgery centers may benefit from the Centers for Medicare & Medicaid Services (CMS) initiative known as ‘Hospitals without Walls’. CMS has authorized new regulatory flexibility through the initiative that will allow hospitals to provide hospital-level care for patients in non-traditional settings. The waiver is intended to ensure that local hospitals and health systems have the capacity to handle the anticipated surge of COVID-19 patients through the duration of the public health emergency. Industry experts say that, due to their facility standards, personnel, equipment, and usual proximity to hospitals, ASCs a most likely candidates to serve as an alternate location for hospital services.

June 25, 2021

  • Capacity restrictions have been removed for most amusement parks, but many foreign amusement park enthusiasts can't visit because of continuing restrictions on international travel. International visitors are the most lucrative for theme parks, according to industry analysts. Closed borders contribute to staffing problems too, cutting the flow of international workers that many parks have hired in the past.
  • A Cardify survey of 1,044 consumers found that 72% are excited to return to amusement parks after the pandemic, more so than movie theaters (68%) or bars and clubs (67%). Only in-person concerts (79%) and sporting events (74%) are more eagerly awaited.
  • Revenue for the amusement, gambling, and recreation industries increased 16.9% during Q1 from the prior quarter but decreased 11.7% year over year, according to the US Census Bureau.
  • The Centers for Disease Control and Prevention said in April that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Amusement parks and arcades are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • Michael Browning Jr., the co-founder and CEO of Urban Air Adventure Parks, said that his theme parks in states that have reopened after coronavirus-induced shutdowns, like Texas and Florida, are outperforming their pre-COVID levels. “For example, in Texas, we’re [at] 120% of our 2019 numbers, our pre-COVID numbers,” Browning said. He attributed the dramatic increase in part to pent-up demand.
  • Consultant Dennis Speigel estimates that US theme parks, worth $25 billion in 2019, have lost $10 billion since the beginning of the pandemic. The impact, he says, has been larger than that of all economic downturns of the past 20 years combined. Spiegel estimates global losses during the pandemic to be $30 billion.
  • Employment in the amusements, gambling, and recreation industry decreased 1% year over year in April.

July 1, 2021

  • The Biden administration said that it will strengthen regulatory protections for livestock and poultry producers in their dealings with meatpackers. The announcement is a response to the coronavirus pandemic and a cyber attack on processing company JBS Foods that the Biden administration says highlighted domination of the industry by a few giant companies. Analysts say that ranchers and cattle feeders have complained that prices meatpacking companies pay for cattle have barely budged even as the cost of beef at the grocery store has been soaring, repeating a 2020 pattern when COVID outbreaks closed or slowed some processing facilities. Four giant companies control more than 80% of U.S. beef processing, and pork and chicken processing also are dominated by only a few companies.
  • The US Department of Agriculture (USDA) has begun releasing up to $44 billion for agriculture producers and businesses as part of the $6 billion Pandemic Assistance for Producers initiative created in March. A total of $11 billion has been allocated since January using available pandemic assistance funds and Tom Vilsack, USDA Secretary, says that more pandemic-related funding will be announced later in the summer along with the Build Back Better program.
  • Just 43% of farmers received a portion of the $20 billion in federal aid distributed through the Coronavirus Food Assistance Program (CFAP), according to USDA data analyzed by the CTPost newspaper. The program was a major boon for Midwest Corn Belt farmers, but in 19 states, fewer than 25% of farmers received a payment. The USDA said it had identified gaps and disparities in assistance both by the commodity being produced and by the type of production or farmer.
  • Pandemic-related supply chain issues that have resulted in rising corn prices and possible corn shortages have some livestock farmers preparing to switch to wheat feed. “We are running out of the corn in the country and wheat got really cheap,” said Joe Nussmeier, a broker at Frontier Futures in Minneapolis. By mid-June, “the only thing to feed critters at that time will be wheat.” Changing the diet of animals comes with some risk: wheat shouldn’t be fed to younger cattle and cows can get bloated if they eat too much of it. Researchers at North Dakota State University recommend that wheat make up no more than 15% of an animal’s diet when it’s being introduced. The color of a bird’s skin can also vary depending on what it eats, with corn-fed chicken looking yellowish, a trait shunned in some countries.
  • The US Department of Agriculture (USDA) allocated an additional $1.1 billion to increase payment rates for more than 410,000 cattle producers under the Coronavirus Food Assistance Program (CFAP) 1 program. USDA will continue taking applications from swine producers and contract growers for CFAP-AA but would not release payments to pork producers as of late March. The department stated that the payments "are likely to require modifications to the regulation as part of the broader evaluation and future assistance."
  • Livestock receipts are expected to increase $8.6 billion in 2021 but higher grain prices will increase animal feed costs and eat into producer’s profits, according to the US Department of Agriculture. Many experts say that support for the animal production industry may be curtailed in future coronavirus stimulus packages as a result.
  • About 87% of an additional $2.3 billion in COVID-19 aid to farmers is earmarked for those who raise pigs and poultry under contracts with food companies. The aid, which comes from money allocated to the US Department of Agriculture from previous pandemic stimulus legislation, follows record federal government subsidies for farmers in 2020. Contract farmers were not eligible for COVID-19 aid under previous USDA programs. They can receive payments if they produced hogs or poultry under a contract for the last two years and had lower revenue in 2020 than 2019.
  • Livestock producers will be compensated for animals culled during the pandemic under the $900 billion coronavirus relief bill that was signed into law in late December 2020.
  • Industry experts say that the agricultural provisions in the latest coronavirus stimulus package are far more detailed than in previous aid packages — which gave Agriculture Secretary Sonny Perdue great leeway in distributing aid — and direct aid to producers and processors who hadn't yet received assistance.

July 1, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Rising demand from the health care and electronics manufacturing sectors will boost sales of nonwoven cleanroom apparel, according to the Global Trade news site. Pharmaceutical, medical equipment, and electronics manufacturers use clean rooms to ensure the purity and/or sterility of their products. Nonwoven cleanroom garments are gaining wider popularity in comparison to other materials as they do not necessitate the need for spinning or weaving the fabrics and can be derived from different sources of raw materials according to Global Trade. Activewear manufacturer 99Degrees began making reusable and disposable isolation gowns in 2020 in response to the pandemic-driven demand increase.
  • Americans are buying apparel again, though they’ve shifted to the casual and athletic wear more suitable to working or lounging at home, says Sue Welch, CEO of supply chain software provider Bamboo Rose. “People are bored with everything” in their wardrobes, Welch says. The sales rebound has led to shortages of some items, as demand has risen faster than supply.
  • Apparel manufacturing employment increased 17.2% year over year in May but was down 16% from the pre-pandemic level of May 2019, according to the US Bureau of Labor Statistics.

July 1, 2021

  • After an initial run on appliances in the early days of the pandemic, manufacturers cut back on production amid factory shutdowns and an anticipated reduction in consumer spending. Appliance production has also been affected by a scarcity of key components such as wiring harnesses, compressors, steel, and semiconductors, which also saw production disruption earlier in the pandemic.
  • Some repair firms have used Zoom Video services to communicate with customers and remotely diagnose appliance issues, walk owners through troubleshooting steps, and determine what parts may be needed if an onsite visit is required. Repair and maintenance firms have also created safety protocols, often based on CDC guidelines, to protect technicians and property owners. Repair firms are outfitting service personnel with masks, gloves, and hand sanitizer. Trucks are sanitized frequently. Technicians request the shortest route through the home to reach the appliance and offer touchless payment options (phone or online). As vaccine distribution increases, consumers and technicians may be more comfortable with in-home services. On April 19, all Americans over age 16 became eligible to be vaccinated. As of July 1, about 155 million Americans were fully vaccinated or about 47% of the US population.
  • Strong demand for housing and persistent scarcity of key inputs, including steel and computer chips, continue to drive an appliance shortage. In a May survey by the National Association of Homebuilders (NAHB), 95% of contractors reported that appliances were in short supply; 57% said there was a “serious shortage.” The value of manufacturers’ unfilled orders for household appliances increased more than 67% in April 2021 compared to a year earlier, according to the US Census Bureau. Scarcity is driving up appliance prices; US consumer prices for major appliances were up more than 12% in May 2021 compared to a year earlier, according to the Bureau of Labor Statistics. Higher costs and supplier delays for construction goods and materials are expected to last into 2022, according to the NAHB. Finished goods and components may also be caught in a supply chain bottleneck at the Ports of LA and Long Beach where containerships can wait off the west coast for weeks before unloading – a situation that has gone on for months. Tight appliance retail supplies, long delivery wait times, and rising prices may prompt consumers to have existing appliances repaired to tide them over until supply constraints and pricing ease.
  • The appliance repair industry is starting to attract new entrants as people who have lost their jobs or seek a career change are attracted by the uptick in demand and potential for good wages. Prior to the pandemic, appliance repair jobs were expected to decline nearly 7% between 2019 and 2029, according to the Bureau of Labor Statistics (BLS). However, the industry’s main US trade group – the United Appliance Servicers Association – says demand for technicians is strong, primarily because there are only two major appliance repair schools in the US where new technicians can receive training.
  • The pandemic-related appliance shortage and resulting rise in demand for repair services has brought more attention to Right to Repair legislation initiatives in some states. Some manufacturers restrict access to parts, tools, and repair manuals for appliances and electronics that contain digital technology, which is more prevalent with the increased popularity of IoT-enabled smart appliances. Such restrictions require repairs to be performed by manufacturer-approved technicians, which critics argue stifles competition and consumer choice. Opponents to Right to Repair argue it can result in unauthorized access to intellectual property. The US Public Interest Research Group, which is supportive of Right to Repair initiatives, says the average US family could save more than $300 per year by having appliances and electronics repaired instead of replacing them.

July 1, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Spending on nonresidential building projects is declining and will do so through 2021, according to a mid-year update to the American Institute of Architects’ (AIA) Consensus Construction Forecast. The AIA estimates an 8% spending drop in 2020 and just under 5% in 2021 due to pandemic-induced economic disruptions. This is the first time in nearly a decade that nonresidential construction spending has trended downwards, according to the AIA.

July 1, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Architectural services may benefit from an anticipated return to co-working spaces when the coronavirus pandemic recedes. Facilities are likely to be renovated if co-working spaces prove to be an attractive option for firms that adopt so-called hybrid work policies, with people working remotely as often as three or four days a week and only visiting the office for essential face to face meetings, according to Realty Biz News.
  • Architecture firms are being asked to renovate buildings because millions of Americans are expected to continue working from home for years. The lack of workers returning to the office on a consistent basis means that rows of office cubicles will likely be phased out, according to NBC News. Spaces will also be designed with a focus on flexibility, so areas can be easily transformed to fit the specific needs of the day, whether that includes a small brainstorming meeting, medium-sized collaboration session, or a large gathering. Redesigned work stations will be more versatile and will feature a strong focus on access to fresh air.
  • Architecture firms are getting many requests to upgrade HVAC systems. High-density filtration is a common request from office building owners, as are ion technology and UV lighting in HVAC systems. Clients are also requesting a change from inoperable windows to operable ones to access outdoor fresh air, and installation of more hands-free technologies for doors, sinks, toilets, etc. Much of the work is being done when building leases turn, which happens every 5, 7, or 10 years, depending on the contract.
  • Architectural services industry employment increased 3.1% from the pandemic-related low of April 2020, but was down 0.4% from the pre-pandemic level of April 2019, according to the US Bureau of Labor Statistics.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Many industry experts say that the coronavirus outbreak may slow or reverse the development of high-density housing. Transportation and denser housing have been critical for cities struggling with a severe affordable housing shortage. “I wouldn’t make any big development decisions right now,” said Dr. Jackson, a former officer in the Epidemic Intelligence Service at the Centers for Disease Control and Prevention. The era of a single architect designing buildings is over, Dr. Jackson added. Transit-oriented development will need to bring in the best minds from design, health, and transit to create living spaces that are conducive to community but also the well-being of residents.

June 24, 2021

  • Businesses that are still reeling from the economic impact of the coronavirus pandemic will have to look for other sources of funding now that the Paycheck Protection Program (PPP) has closed. Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Foot traffic at art galleries is likely to rebound if the number of COVID-19 cases continues dropping as vaccination rates increase. About 45% of the country's population has been fully vaccinated as of Jun 23, and 54% has received at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention.
  • Industry experts expect a strong rebound as the pandemic wanes. The collective wealth of America’s 651 billionaires has jumped by $1 trillion since the start of the pandemic, according to Americans for Tax Fairness and the Institute for Policy Studies. Some of those gains are likely to be used to purchase works of art.
  • Global sales of art and antiques were estimated to have decreased 22% year over year in 2020, largely due to pandemic-related closures of galleries and art fairs, according to the annual Art Basel and UBS Art Market report published in March. Combined dealer and auction house sales totaled $50.1 billion, their lowest level since the financial crisis of 2009. Dealer sales decreased an aggregate 20%, to $29.3 billion, while public auctions, many of which were conducted in online-only formats, were down 30%, to $17.6 billion. Private transactions at auction houses increased 36%, to $3.2 billion, according to the report.
  • Galleries that operate online only increased to 35% of total galleries in 2020 from 15% in 2018 and 2019, according to Artsy, an online platform for fine art. About 75% of galleries have partnered with an online marketplace in 2020, however.

July 11, 2021

  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. “Single-family permits declined to the lowest pace since September 2020 as the home building market cools somewhat to adjust to higher prices and longer delivery times of building materials,” said NAHB Chief Economist Robert Dietz. “The count of single-family homes permitted but not started construction is up 53% over the last year due to both gains for home construction since the onset of the 2020 virus crisis and the delay of some building projects due to higher costs for materials and labor.”
  • Manufacturers of asphalt paving and roofing materials increased their prices 6.1% year over year in May, but left them unchanged from the beginning of the year. The cost to manufacture asphalt products is affected by the price of oil, a major feedstock. Crude oil spot prices increased from about $47 per barrel on January 4 to $74.63 on July 9.
  • Shingle shipments increased 26.9% year over year during Q1, according to the Asphalt Roofing Manufacturers Association. Shipments increased 44.9% year over year in Q4 2020 and were up 10.1% for all of 2020.
  • Some uncertainty remains about road construction in 2021. So-called "shovel-ready" road construction projects may be fewer, as contractors took advantage of less congested roadways during the coronavirus pandemic to race through project backlogs in 2020. Funding may be available for new projects, however, as many states have been able to preserve highway funding despite the pandemic through program cuts or by transfers from their general funds.
  • The $900 billion coronavirus relief package signed into law in late December 2020 includes $10 billion for state highways. Industry experts say that the funding is intended to help offset severe losses in state transportation revenues due to reduced vehicle travel during the pandemic.
  • Employment in the asphalt product manufacturing industry increased 5.8% year over year in May but was down 11.6% from the pre-pandemic month of May 2019.

June 12, 2021

  • The CEO of wireless audio equipment manufacturer Sonos expects strong sales to continue post-pandemic. Patric Spence says that the company is riding three secular trends: the "golden age of audio," direct-to-home movie releases, and a hot housing market. "A lot of people now have new flexibility and freedom to work anywhere and so they're moving, they're setting up a new home and that's perfect for Sonos," he said.
  • US Education Secretary Miguel Cardona said in early May that he expects all schools to be open full-time in person for all students in the fall. Demand for audio and video equipment used for remote learning may decline if the expectation is met. About 54% of public schools below high school were providing full-time in-person learning in early May, up from 46% in January, according to a survey released by the Education Department.
  • Musical instrument retailer Sweetwater reported strong sales of video streaming equipment to houses of worship and institutions that moved online in 2020.
  • New auto sales, an indicator of demand for some audio and video equipment, increased 8% year over year during Q1 2021 as strong March sales far outpaced last year when the coronavirus pandemic began. A shortage of computer chips is forcing automakers to cut production, however, and that could affect sales later in the year.
  • The COVID-19 crisis drove digital media consumption to new heights, while traditional media stagnated, according to eMarketer. Time spent with digital increased 15% year over year in 2020 to 7 hours, 50 minutes daily. Connected TV usage increased 33.8% year over year to 1 hour, 17 minutes per day. Subscription streaming usage increased 33.9% to 1 hour, 12 minutes per day. Digital audio usage increased 8.3% to 1 hour, 29 minutes per day. eMarketer predicts that these formats will claim even more daily media time going forward. Traditional TV, social media, tablets, and desktops/laptops will likely decrease year over year in 2021.
  • Many legal experts agree that corporations can require COVID-19 vaccinations for employees. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with the union before mandating a vaccine.
  • TV remains the primary source of entertainment for 92% of Americans, according to “Content in the COVID-19 Era: Current Realities and Future Opportunities” report from the Consumer Technology Association (CTA). The report also finds that 60% of video content viewing time takes place in front of TV screens; the rest is on smartphones, computers and tablets. “Consumers are watching more content and watching longer, as new innovations in format and delivery draw in millions of first-time users," said Sayon Deb, manager, Market Research, CTA.
  • Production of audio and video equipment increased 22.5% year over year in April, according to the Federal Reserve. Year-over-year comparisons are made difficult due to production decreases in 2020 that may have been related to the coronavirus pandemic. Production of audio and video equipment increased 5% in April compared to the same month in the pre-pandemic year of 2019.
  • The audio and video equipment industry is playing a pivotal role in connecting people and helping to keep businesses running through virtual meetings as the pandemic plays out. Businesses, entertainers, news organizations, and individuals have invested in AV equipment to remotely produce and broadcast content.
  • Pro AV industry advertising spending is not expected to recover until late 2021 or 2022, according to financial firm PJ Solomon.

July 11, 2021

  • Semiconductor manufacturer Intel's Chief Executive Officer Pat Gelsinger predicted that the shortage of semiconductors that’s hurting industries from automotive to consumer electronics devices like audio and video equipment will peak in the second half of 2021 before starting to improve. “I don’t expect the chip industry is back to a healthy supply-demand situation until ’23,” he said in an interview. “For a variety of industries, I think it’s still getting worse before it gets better.”
  • The CEO of wireless audio equipment manufacturer Sonos expects strong sales to continue post-pandemic. Patric Spence says that the company is riding three secular trends: the "golden age of audio," direct-to-home movie releases, and a hot housing market. "A lot of people now have new flexibility and freedom to work anywhere and so they're moving, they're setting up a new home and that's perfect for Sonos," he said.
  • US Education Secretary Miguel Cardona said in early May that he expects all schools to be open full-time in person for all students in the fall. Demand for audio and video equipment used for remote learning may decline if the expectation is met.
  • The COVID-19 crisis drove digital media consumption to new heights, while traditional media stagnated, according to eMarketer. Time spent with digital increased 15% year over year in 2020 to 7 hours, 50 minutes daily. Connected TV usage increased 33.8% year over year to 1 hour, 17 minutes per day. Subscription streaming usage increased 33.9% to 1 hour, 12 minutes per day. Digital audio usage increased 8.3% to 1 hour, 29 minutes per day. eMarketer predicts that these formats will claim even more daily media time going forward. Traditional TV, social media, tablets, and desktops/laptops will likely decrease year over year in 2021.
  • Many legal experts agree that corporations can require COVID-19 vaccinations for employees. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with the union before mandating a vaccine.
  • TV remains the primary source of entertainment for 92% of Americans, according to “Content in the COVID-19 Era: Current Realities and Future Opportunities” report from the Consumer Technology Association (CTA). The report also finds that 60% of video content viewing time takes place in front of TV screens; the rest is on smartphones, computers and tablets. “Consumers are watching more content and watching longer, as new innovations in format and delivery draw in millions of first-time users," said Sayon Deb, manager, Market Research, CTA.
  • Production of audio and video equipment increased 35.4% year over year in May, according to the Federal Reserve. Year-over-year comparisons are made difficult due to production decreases in 2020 that may have been related to the coronavirus pandemic. Production of audio and video equipment increased 1.3% in May compared to the same month in the pre-pandemic year of 2019.

June 22, 2021

  • About 72% of franchised auto dealers who responded to the 2021 Cox Automotive Dealership Staffing Study said that finding and hiring suitable employees is proving difficult. Some 65% of those dealers plan on hiring new employees this year, while just 34% plan on sticking with their current staff. Cox’s study also found that 32% of surveyed job seekers indicated that they didn’t believe they have the skills necessary to work at a dealer. Bob Kostkan, senior director at Cox Automotive University, notes that this isn’t often the case.
  • Pandemic-driven changes to the car buying process have made dealerships more productive, according to Automotive expert Karl Brauer. Increased use of e-commerce tools allow consumers to look at more vehicles before they enter the dealership, allowing them to independently gather vehicle option and price information. The tools also allow salespeople to deal with more than one customer at any given moment, and may allow them to have as many as 10 deals in process simultaneously. In an increasing number of cases, purchases can be completed online and the car can be delivered to the customer, further reducing time spent on each sale.
  • GM executives say that purchases through its Shop-Click-Drive online service, which was launched in 2013, have increased during the pandemic by about 40% from pre-COVID levels. About 85% of GM dealers are now using the service.
  • A record 289 dealership transactions occurred during 2020, a 24% year-over-year increase, according to Kerrigan Advisors, a national sell-side advisor to dealerships. That is 47 more transactions than in the previous record year of 2015. “Owners of large dealership groups are choosing to sell their businesses at today’s high valuations rather than accommodate the changes and investments required in terms of electric vehicles and digital retail sales,” Kerrigan Advisors analysts said. “This resilient—and resurgent—auto retail performance of 2020 has increased demand for dealerships and has continued to fuel valuations.”
  • Retail sales for auto dealers decreased 3.7% in value month over month on an adjusted basis in May but increased 42.5% in value year over year on an unadjusted basis during the first five months of 2021.
  • Several industry analysts expect new auto sales to increase about 6.9% in 2021. The National Automobile Dealers Association expects 2021 sales of 15.5 million. Forecasters at car-shopping web site Edmunds also predicted 2021 sales of 15.5 million. Charlie Chesbrough, senior economist for Cox Automotive, said that Cox expects 2021 sales of 15.7 million. US new auto sales in 2020 were 14.5 million, down 15% from 2019. It was the fourth-largest annual decline since at least 1980.
  • The average new vehicle transaction price increased 1.2% month over month to $41,263 in May (+$493) and was up 5.4% (+$2,125) year over year. "Last month's average transaction price performance highlights an all-time high in year-over-year growth for the month of May," said Kayla Reynolds, industry intelligence analyst at Cox Automotive.
  • Employment in the auto dealer industry increased 12.4% year over year in May but was down 3.8% from May 2019.

July 2, 2021

  • Respondents to a Martec Group survey expect to drive more post-pandemic than before the COVID-19 pandemic. Pent-up demand for travel and activities was cited as a key reason for the expected increase. Many people moved during the pandemic, with more than one-third moving farther away from work. Auto parts distributors are likely to benefit from increased travel and longer commutes.
  • Automaker Ford is redesigning automotive components to use more accessible chips. Auto parts distributors are likely to be impacted by the change. Ford CEO Jim Farley said that about 60% of the chips used in Ford’s vehicles are 55-nanometer or larger, what he called “mature nodes”. The supply of those chips is constrained. “Not only are we redesigning a lot of our components to work with chips that are more accessible ... but we think we need to look at buffer stocks, actual direct contracts with some of the foundries,” Farley said. “We think that’s going to be a really critical approach to our supply chain as we get more electronic components.”
  • United Microelectronics Corporation (UMC), the world’s fourth-largest contract chipmaker, is expanding its capacity to produce "mature technology" chips like those used in many auto parts. A pandemic-related shortage of semiconductors has slowed production of auto parts, leading to shortages. UMC said it would add capacity for manufacturing 20,000 wafers a month at 28 nanometers, one of the process technology nodes worst-hit by the global chip shortage, at an existing fabrication plant.
  • Auto parts distributors may be impacted by pandemic-induced changes in logistics strategies that are being implemented in the auto industry. Many companies in the supply network are reducing reliance on the just-in-time, lean production practices that have guided automotive manufacturers for nearly 40 years, according to Reuters news service. Firms are sourcing products from multiple suppliers, asking suppliers to hold in warehouses a backlog of critical inventory, and building out software networks to better track suppliers. Companies are looking at the total cost of any approach instead of simply its upfront price tag, according to BorgWarner Chief Executive Frederic Lissalde.
  • The coronavirus pandemic is accelerating the transition to an e-commerce model that may threaten the viability of many auto parts distributors, according to some industry experts. Rapid development of e-commerce features including advanced search by year/make/model, exploded parts views, component search, and search by product specification may eliminate customers’ need for distributor expertise. The software advances may ultimately allow parts manufacturers to significantly increase direct sales without investing heavily in customer support. Experts say that a key distributor response to the challenge will be ensuring quick parts delivery through careful placement of distribution centers that resolve "last mile" delivery issues.
  • Vehicle miles traveled (VMT), an indicator of demand for auto parts, decreased 4.7% month over month in April, according to the Federal Highway Administration. VMT increased 8.6% year over year during the first four months of 2021, however. VMT was down 13.2% year over year for all of 2020.
  • Supply chain disruptions and delivery delays caused by the coronavirus pandemic are likely to continue well into 2021, according to financial information and analytics firm S&P Global. A lack of air freight capacity and a shortage of empty containers and other equipment needed to haul products away from port facilities are creating difficulties for supply chains in all industries. Deliveries are likely to take longer and costs of in-demand items are likely to rise as container shipping rates jump.

July 2, 2021

  • Pandemic-related semiconductor chip shortages are now expected to lower global auto output by 3.9 million vehicles in 2021, or 4.6%, according to Time magazine. Ford alone expects to produce 1.1 million fewer vehicles, leading to a $2.5 billion earnings reduction.
  • GM officials said that the company's factories will still be affected by the chip shortage through June and July. Chip usage is being shifted to higher-margin, high-demand vehicles such as pickups and full-size SUVs to minimize the impact, however. US assembly plants that build those products won't take the traditional summer two-week shutdown this year, the company said.
  • Auto parts maker Dana raised its full-year earnings forecast in late April after beating first-quarter estimates. The company now expects full-year adjusted earnings of between $2.10 and $2.60 per share, compared to a prior forecast of between $1.90 and $2.40 per share. "Dana realized higher sales... as a result of continued strength in the light-truck market, as well as growth in both the commercial-vehicle and off-highway markets," said Chief Executive Officer James Kamsickas. He warned, however, that despite a recovery in end-markets from last year's downturn, higher costs due to supply-chain disruptions and shipping constraints continue to challenge the industry.
  • A letter addressed to congressional leaders of both parties and to White House officials from groups representing some of the world’s biggest technology companies argues against specifying what kind of semiconductor manufacturing should get federal financial support for domestic expansion. The letter specifically objects to requests from some companies -- like auto parts manufacturers -- seeking an increase of manufacturing capacity for more basic chips. “The market-distorting effect of ‘setting aside’ a portion of new capacity for legacy chips for any single, private sector would squeeze the remaining chip-consuming industries into the remaining new manufacturing capacity, artificially constraining supply,” the letter states. Industry experts say that pandemic-related supply chain problems have boosted support for federal funding of domestic semiconductor manufacturing.
  • Auto parts manufacturers are currently focusing on securing their supply chains due to pandemic-related shortages. Dana has begun sourcing key commodities including resin, castings, forgings, and some electrical components from multiple suppliers, is asking suppliers to hold in warehouses a backlog of critical inventory, and is building out its software network to better track suppliers. The company is also helping its smaller suppliers recruit workers and secure shipping space on containers to avoid any impact on its operations. Such approaches may cost more upfront, according to David Simchi-Levi, a professor of engineering systems at the Massachusetts Institute of Technology, but they are likely to pay for themselves if they help companies avoid the higher cost of parts shortages.
  • Industry experts cite a combination of pandemic-related issues as major contributors to the semiconductor chip shortage that is spreading across all aspects of the auto industry. The roots of the shortage lie in the early weeks of the pandemic, when auto plants worldwide abruptly shut down amid widespread stay-at-home orders and plummeting auto sales, according to consulting firm AlixPartners. Car companies and parts suppliers drastically cut their semiconductor purchases just as computer and consumer electronics manufactures increased purchases due to increasing sales that were also caused by the abrupt shutdown and widespread stay-at-home orders. “Semiconductor manufacturers weren’t getting orders from auto manufacturers. They were getting orders from other industries, so they started to reallocate production,” said Shawn DuBravac, chief economist of IPC, an electronics industry association. Auto sales recovered faster than expected, and automakers trying to increase chip orders found their suppliers busy making different, more advanced components for computer and consumer electronics manufacturers. Switching manufacturing lines from one type of chip to another is a lengthy process, and many chip manufacturers are reluctant to switch from producing the higher-margin advanced chips ordered by computer and consumer technology manufacturers to low-margin chips needed by the auto industry.

June 24, 2021

  • A wave of Covid-19 clusters in Asia is creating new bottlenecks in the global supply chain, according to The Wall Street Journal. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries. Thailand has been battered over the past two months by its worst ever surge of new cases, while Vietnam has also suffered. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit. Auto parts retailers are likely to be negatively impacted, as many parts are manufactured in Asia.
  • Vehicle miles traveled (VMT), an indicator of demand for auto parts, decreased 4.7% month over month in April, according to the Federal Highway Administration. VMT increased 8.6% year over year during the first four months of 2021, however. VMT was down 13.2% year over year for all of 2020.
  • Auto parts retailers eager to capitalize on hopes that the end of the coronavirus pandemic is in sight may have trouble finding workers. Job seekers say that the wages being offered by employers in the post-lockdown job market are simply too low, according to NBC News. “They can't literally scoop up folks at the end of their rope without assuming anything beyond bare minimum pay,” said Atlanta resident John Huston, 59, a former senior marketing associate. “The reason that there are so many openings is that they do not pay a living wage."
  • Semiconductor manufacturer Intel plans to build two major factories in Arizona. The news comes amid a pandemic-related chip shortage that is slowing production in the auto industry. Intel's foundry will offer an alternative to Asian chip factories. President Biden has said that domestic semiconductor manufacturing is a priority for his administration.
  • Employment in the auto parts and accessories store industry increased 7.3% year over year in April but was unchanged from the pre-pandemic month of April 2019.
  • The auto parts e-commerce market is expected to rise to $22 billion by 2023. The growth will be driven in part by a pandemic-induced shift away from bricks-and-mortar stores.

June 24, 2021

  • Analysts expect auto rental firm Hertz to emerge from Chapter 11 bankruptcy protection by the end of June after a bankruptcy court confirmed the company's reorganization plan. Hertz was among the first major corporations to declare bankruptcy in 2020 as infections surged and shut down travel on a global scale for both companies and vacationers.
  • Auto rental companies have resorted to buying used vehicles at auction due to pandemic-related supply chain issues that have slowed new vehicle production. Vehicle production fell 4.6% in the first quarter of 2021, and that’s compared to 2020 when factories had already lost weeks of work when the Covid-19 pandemic caused shutdowns, according to LMC Automotive. The demand is sending used-car costs soaring. The Manheim Index, which measures prices at wholesale auctions, shows that used cars costs were 52% higher year over year in May. Analysts say that, despite the acquisition expenses, the car crunch is a boon for rental companies, which likely will have strong profits because they’ll rent out every car they own at much higher rates than they charged before the COVID-19 pandemic began.
  • A rental car shortage combined with rising demand is driving up rental car prices. Many firms quickly sold large portions of their fleet and canceled upcoming orders at the beginning of the pandemic. Demand dropped as much as 90% in the early weeks, forcing companies like Hertz to file for bankruptcy. Car rental firms are now unprepared for a surge in new bookings as travel rebounds.
  • Rules that allocate about $2.8 billion to airports in federal coronavirus stimulus packages require the airports to use $200 million of the funding to provide rent abatement and relief from minimum annual guarantees to airport concessionaires, including car rental companies.
  • Federal stimulus funding also contains $2 billion in grants for “providers of transportation services” (CERTS program). Bus and ferry companies are specified as eligible under the law, but the Departments of Treasury and Transportation can identify additional providers, such as car rental companies, to qualify for the grants as well.

June 25, 2021

  • Depending on the state or city where they operate, repair shops may experience a rise in demand as driving activity continues to normalize. Since April 2020, vehicle miles traveled has gradually increased as more states fully reopened, according to traffic data from the Federal Highway Administration. Geopath – a firm that measures vehicle traffic for out-of-home media – reported that weekly miles traveled in April 2021 were 67% higher than they were in April 2020. During the same period, the number of car trip requests on Apple Maps increased 131%. Aided by wider vaccine distribution, daily new COVID-19 cases have dropped since the spike seen in mid-January. As of June 23, the 7-day average for daily new cases was about 11,000, less than half of what they were just a month before. Hospitalizations and deaths were also down significantly. In May 2021, the Centers for Disease Control and Prevention (CDC) issued new guidelines suggesting fully vaccinated people can resume normal activities without wearing a mask or physically distancing.
  • More driving during the summer of 2021 may help boost demand for auto repair shops as motorists get current on routine maintenance, such as oil changes, prior to road trips. Driven in part by optimism brought on by vaccine availability as well as stimulus checks, gasoline consumption during the summer 2021 driving season (April-September) is expected to average 9.1 million barrels per day (b/d), which is 1.3 million b/d more than last summer, according to the US Energy Information Administration (EIA). However, gasoline consumption this summer will still be lower than in 2019.
  • After COVID-19 and related economic factors reduced US automotive aftermarket sales in 2020, the industry is expected to rebound strongly in 2021, according to a jointly-prepared forecast released in June 2021 by the Auto Care Association (ACA) and the Automotive Aftermarket Suppliers Association (AASA). The ACA/AASA forecast projects US automotive aftermarket sales to rise 11% in 2021 and reach $325 billion in 2021, up from about $292 billion in 2020. Aftermarket sales are forecast to rise as the number of miles driven continue to increase and as consumers tend to hold onto their older cars longer.  The average age of the US car fleet hit an all-time high of 12.1 years in 2020, according to IHS Markit. About 25% of cars on US roads are at least 16 years old.
  • Repair shops are taking precautions like disinfecting door handles and steering wheels as well as wearing gloves and masks while in customers’ cars and communicating. Repair shops are reconfiguring seating in their waiting rooms to ensure social distancing. The pandemic has increased the popularity of mobile mechanics that fix cars without physical shops. Mobile repair startup Wrench has seen strong growth as more consumers and fleet owners opt for its touchless, app-scheduled services and quick turnaround times, according to GeekWire.
  • Auto repair shops that saw business drop off during the pandemic may have sought relief via the reauthorization of the Paycheck Protection Program (PPP). The PPP was revived with the December passage of the $900 billion COVID-19 Economic Stimulus Relief Act. The legislation included $300 billion in funding for Small Business Administration (SBA) loans. The round of PPP passed in December let eligible borrowers get a second draw loan. It also simplified loan forgiveness for loans under $150,000 and makes forgiven loans tax deductible. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act which included an additional $7.25 billion for PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • As consumers have driven less, some are finding problems with their vehicles that were caused by long periods of sitting idle. Mechanics have reported higher instances of calls for dead batteries that need recharging or replacement. Other problems related to parking for long periods include rusty brake rotors and calipers, flat spots on tires, and motor oil contamination caused by condensation. Repair shops may see more calls related to idled vehicles as vaccinations gather pace, new COVID-19 cases drop, and state and local economies continue to return to pre-pandemic ways of life.
  • Demand for used cars has increased amid a global semiconductor shortage that has limited new car production. Sales of certified pre-owned (CPO) vehicles rose 4% in May 2021 compared to April, according to Cox Automotive. Year-to-date CPO sales as of May 2021 were up 25% compared to the same period in 2020. Total year-over-year used car sales were up 3% in May. The root causes of the semiconductor shortage reach back to the beginning of the pandemic when consumer buying patterns shifted and supply chains were disrupted. Carmakers cut back on production - and computer chip consumption - while home-bound consumers ramped up purchases of computers, game consoles, and other chip-containing electronics. When auto production bounced back, the whipsaw in chip demand – combined with US sanctions on Chinese tech and bad weather – made the semiconductor shortage worse. Gartner expects the shortage could persist into Q2 of 2022. The increase in used car sales might lead to more demand for auto repair shops.

July 21, 2021

  • New vehicle sales increased 50.2% year over year during Q2 but were down 0.4% compared to the same period in 2019. Analysts say that a semiconductor chip shortage which is limiting auto production will start to ease in Q3, but won’t be gone completely until 2022.
  • A wave of Covid-19 clusters in Asia is creating new bottlenecks in the global supply chain, according to The Wall Street Journal. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries. Thailand has been battered over the past two months by its worst ever surge of new cases, while Vietnam has also suffered. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit. Auto manufacturers that rely heavily on parts manufactured in Asia are likely to be negatively impacted.
  • Automakers are accumulating inventories of parts and unfinished vehicles while production and shipments of finished products decrease due to the absence of critical inputs, primarily semiconductor chips. Inventories have increased 12% since December while shipments of finished product have decreased 13%, according to Barron's Magazine.
  • Auto manufacturing firms, which have been forced to slow or stop the production of some models due to a pandemic-related semiconductor shortage, are now facing a natural rubber shortage caused in part by the coronavirus pandemic. Slow shipping has disrupted the delivery of natural rubber, which is a key material in many auto parts and components. Analysts say that reliance on the just-in-time manufacturing process to reduce costs left automakers with limited flexibility when the pandemic hit.
  • Parts shortages are increasing for many firms, including automakers, partly because of pandemic-related congestion in freight transportation networks. A pandemic-driven shift in consumer purchasing habits from experience purchases to consumer goods purchases, particularly for the home, led to a dramatic increase in imports from Asian manufacturing centers, according to The Detroit News. The increase in imports resulted in backups at overwhelmed ports and freight hubs across the US. Businesses of all types are now forced to wait months instead of the usual weeks for deliveries, and no one knows when the situation will be resolved. The Fitch Ratings credit ratings agency said in its ‘Fitch Ratings 2021 Outlook: US Transport’ that the coronavirus pandemic will continue to be an impediment, even though performance will improve in 2021.
  • General Motors expects the semiconductor chip shortage to cut its earnings by $1.5 billion to $2 billion in 2021. Ford Motor said the situation could lower its earnings by $1 billion to $2.5 billion. Honda Motor and Nissan Motor combined expect to sell 250,000 fewer cars through March due to the shortage. Automakers are scrambling to get chips, which have extremely long lead times due to their complexity. Some automakers, like GM and Ford, have confirmed plans to partially build products and store them until chips become available. Others have said they may look to directly purchase the parts from smaller suppliers, cutting out much of the current supply chain.
  • Several industry analysts expect new auto sales to increase about 6.9% in 2021. The National Automobile Dealers Association expects 2021 sales of 15.5 million. Forecasters at car-shopping web site Edmunds also predicted 2021 sales of 15.5 million. Charlie Chesbrough, senior economist for Cox Automotive, said that Cox expects 2021 sales of 15.7 million. US auto sales in 2020 were 14.5 million, down 15% from 2019. It was the fourth-largest annual decline since at least 1980.
  • Fleet sales to rental car companies, corporations, and government agencies are likely to recover more slowly than sales to private individuals, according to Cox Automotive (CA). Fleet sales are not a major concern now for automakers focused on ramping up production to restore dealer inventories for higher-profit sales to consumers, according to CA, but they will become a challenge when inventories are replenished because production must be maintained to keep automakers profitable. “If we don’t see a rebound in 2021, this will be a problem for automakers,” said Zohaib Rahim, economic and industry insights manager at CA. “But right now they’re using all their production to supply dealers.”

July 8, 2021

  • The COVID-19 crises caused the global airline industry to have its worst year on record in 2020, according to the International Air Transport Association (IATA). Worldwide passenger traffic, as measured by revenue passenger kilometers (RPKs), fell 65% in 2020 compared to 2019. International passenger demand was off more than 75%, and domestic demand declined nearly 49%. Traffic in 2021 is expected to reach about 49% of levels seen in 2019, but will be up 26% over 2020. Domestic passenger traffic is projected to recover quicker, returning to 96% of pre-pandemic levels by the second half of 2021. Vaccination and testing regimens, primarily in the US and Europe, are expected to enable some international travel by the second half of 2021, but international traffic will still be only 34% of that seen in 2019. Airline industry revenue is forecast to reach $458 billion in 2021, only 55% of what it was in 2019 but 23% higher than the low point of 2020. In June 2021, the IATA said global air travel demand improved in April 2021 but was well below pre-pandemic levels. Total air travel, as measured by RPKs, was down 65.4% in April 2021 compared to April 2019. Domestic air travel was down 25.7%, and international travel was off 87.3%.
  • Amid weak passenger traffic, demand for used parts is likely to be strongest for cargo conversions of older narrowbody aircraft and for engine work on existing cargo aircraft. Industry watchers note that during the pandemic airlines pulled spare parts from grounded aircraft, reducing demand for new parts. As airline demand rebounds, MRO demand for parts will likely follow. Airlines’ spending on MRO dropped 45% in 2020, shedding about $50 billion in revenue, according to aviation consulting firm Oliver Wyman. Some of the postponed work will occur once aircraft utilization patterns normalize, but much of that revenue may not be recovered as aircraft near the end of their lifecycle may remain mothballed instead of undergoing expensive, late-life MRO work.
  • Industry watchers suggest the COVID-19 pandemic will accelerate MROs digital transformation efforts as they look for ways to increase efficiency and trim costs. Key trends include remote inspection and training that’s enhanced with augmented reality (AR) technology, analytics-based predictive maintenance, and IoT-enabled inventory systems.
  • Some industry watchers suggest that the coronavirus pandemic may cause airlines to rethink the strategy of keeping aircraft on their balance sheets. If airlines instead lease aircraft from manufacturers, it could further the pre-pandemic trend of aircraft OEMs bringing MRO in-house. As the pandemic has worn on, more airlines are leasing aircraft from aircraft leasing firms as they take on long-term liability in exchange for short-term liquidity, according to Aviation Week. However, with air traffic demand down, aircraft lessors may not have new lessees lined up when aircraft come off-lease. Under these market conditions, MROs that offer full-service technical and aircraft storage capabilities may be advantaged because they can store and maintain lessors’ planes until demand picks up.
  • In early October, Boeing released its annual 20-year Boeing Market Outlook (BMO) forecast for the aerospace and defense market. The BMO expects the global market value to be $8.5 trillion over the next decade, down from $8.7 trillion forecast in the 2019 BMO. The global commercial fleet will add about 18,500 aircraft over the next 10 years, or 11% lower than the 2019 projection. Single-aisle aircraft seating 90 or more passengers are expected to account for more than 32,000 of about 43,000 global aircraft deliveries between 2020 and 2039. During that period, Boeing expects the global aviation industry will need 739,000 new maintenance technicians, down 3.9% from the 770,000 projected in 2019.
  • Some MRO firms have fared better than others during the pandemic, often determined by which types of aircraft they service. In the early days of the pandemic, commercial flights were essentially grounded, but those with the means to do so took private planes to quarantine destinations. In some cases, the downtime that followed was used to provide scheduled maintenance, or avionics and interior upgrades. Throughout the pandemic, business and charter aviation have generally enjoyed greater demand than commercial flying, which has helped prop up demand for private jet MRO services. In 2021, total MRO activity it expected to be on par with 2020 levels through the first half of the year, according to Forbes. By the second half of 2021, business jet flights are projected to be within 10% of normal levels while airlines are expected to recover to 25%-50% of typical traffic levels.
  • As airlines await a gradual return of passenger traffic, most are hesitant to make significant changes to their MRO strategies, according to Aviation Week. Large airlines tend to have more in-house MRO operations and many of them have no major plans to shift toward outsourcing. However, as airline traffic recovers, smaller airlines that already depend on outsourced MRO are likely to lean on outsourcing even more to keep up with maintenance as scheduled flights increase.
  • Domestic US air travel is enjoying a rebound as vaccination rates rise, helping to release more than a year’s worth of pent-up travel demand. On July 7, 2021 the US Transportation Security Administration (TSA) screened 1,880,911 passengers compared to only 632,498 on the same day in 2020. On July 7, 2019 the TSA screened 2,515,902 passengers. While domestic travel is returning, international trips will take more time to recover. Amid falling rates of new COVID-19 cases and improved vaccination distribution, the European Union (EU) on May 19 announced it would reopen its borders and admit vaccinated travelers. The EU member states not already open to US tourists opened in mid-June. Most EU countries will require proof of vaccination, a recent negative COVID-19 test, or evidence showing recovery from the disease, according to The Wall Street Journal. In late June, the UK said that over the summer it would gradually reduce its quarantine requirements for vaccinated travelers from approved countries, including the US. A broad ban on international travel to the US has been in place since January.
  • A sharp uptick in US summer passenger demand caught airlines off-guard, which in some cases led to delays, according to The Wall Street Journal. Industry insiders and union leaders suggested airlines have had trouble meeting a rebound in air travel demand as they were not able to bring back enough pilots, mechanics, and other workers that were laid off earlier in the pandemic. As air travel remains uneven, MRO firms may struggle with projecting near-term staffing needs and ensuring the right balance of staff needed to meet demand, which may rise or fall suddenly due to pandemic conditions.

June 24, 2021

  • Businesses including bars and nightclubs are reopening just as a coronavirus variant that World Health Organization officials said is "faster" and "fitter" than previously identified ones begins spreading in the US. The Delta variant, which is believed to be more transmissible and cause more severe disease, could cause an upsurge in infections, but the levels will vary depending on the rates of vaccination in each area, said Scott Gottlieb, former commissioner of the US Food and Drug Administration. The Delta variant was first identified in India, which experienced a devastating surge in cases and deaths during May.
  • Legislatures in Alabama, Arizona, Florida, Georgia, Illinois, Louisiana, Maryland, Michigan, Mississippi, Ohio, Texas, Virginia, Washington, and West Virginia have passed bills either extending or making permanent laws that allow alcohol delivery from restaurants, bars and, in some cases, liquor stores. While some of these bills are still awaiting governor signatures at the state level, some cities are also taking unilateral action or asking state houses for legislative action, including New York City. California, Massachusetts, Pennsylvania, South Carolina and Wisconsin are also among states with legislatures that have been debating similar moves in recent months.
  • Bars and nightclubs that closed during the pandemic will need to proceed carefully when lockdown orders are lifted, as hospitality employers in some jurisdictions must offer certain former employees their jobs back. A new Washington, DC, law, for example, provides eligible non-exempt workers in the hospitality industry who were displaced by COVID-19 the right to be reinstated to their former positions. The law may also apply when there has been a change of ownership. Covered employees can sue their employers for violations of the law on an individual and class basis. Prevailing employees can be awarded back pay, the cost of lost benefits, punitive damages, and attorney’s fees. A sunset provision was included in the law that expires on June 30, 2023.
  • Americans shifted their drinking patterns to off-premise consumption during the coronavirus pandemic. “That frequent on-premise drinker is 60% more likely to have purchased more alcohol in the past month through delivery or pick up from a store, 80% more likely to have purchased online from a bar or restaurant, and 55% more likely to have increased their online purchases from a brewery, winery or wine club, or distillery,” said Danelle Kosmal, Nielsen’s vice president of beverage alcohol.

July 11, 2021

  • US chemical manufacturers may benefit from a wave of Covid-19 clusters in Asia that is creating new bottlenecks in the global supply chain, according to The Wall Street Journal. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries. Thailand has been battered over the past two months by its worst ever surge of new cases, while Vietnam has also suffered. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit.
  • Analysts expect greater demand for basic chemicals used in the manufacture of home appliances and medical gear such as surgical gloves. The pandemic-driven increase in demand for these products is expected to continue for much of 2021.
  • Most pharmaceutical companies do not plan to change their manufacturing network despite the possibility that events like the COVID-19 pandemic may disrupt supply channels, according to a GlobalData survey. About 68% of the companies surveyed expect no changes to the finished dose manufacturing sites, while 57% expect no changes in the small molecule API manufacturing site network. Approximately 25% of the companies opined that they will need small molecule API manufacturing sites in more countries, while 7% seek to trim their manufacturing sites to fewer countries. Further, 17% of the companies opined that they need to expand their finished dose manufacturing network to more countries, while 15% opined that they need production sites at fewer countries than that they have today.
  • The basic chemical manufacturing industry could see significant demand growth if pharmaceutical manufacturing is re-shored in the US from low cost foreign producers like China and India. The US government has invested $354 million in Phlow, a start-up tasked with developing a low-cost production process for generic drugs in the US and reducing reliance on foreign suppliers. The company uses the flow chemistry method to manage the production process and reduce waste, ultimately to make products cheaper and readily available. If successful, Phlow’s strategy could overhaul the drug production and delivery system in the US.
  • Employment in the basic chemical manufacturing industry increased 1% year over year in May, according to the US Bureau of Labor Statistics.
  • The prices that manufacturers charge for basic chemicals have increased. Prices increased 6.5% for basic inorganic chemicals year over year in May and 59.3% for basic organic chemicals. Year-over-year price comparisons may be distorted by price decreases in 2020 that may have been related to the coronavirus pandemic outbreak. Basic inorganic chemical prices increased 2.1% in May compared to the same month in the pre-pandemic year of 2019. Basic organic chemical prices increased 20.4% in May compared to the same month in the pre-pandemic year of 2019.

July 21, 2021

  • China's exports of rare earth products in the first half of the year have surged past pre-pandemic levels in 2019. Analysts say that the increase suggests that attempts by the US to bolster its domestic supply chain may not bear fruit quickly. The country's rare earth exports increased 25.3% year over year during the first half and were 16.5% above the first half of 2019. China controls about 90% of the world's supply of rare earths, some of which are critical inputs in many battery products.
  • Power tool manufacturer Stanley Black & Decker is hoping to strike partnerships with battery and chip manufacturers to help ease the pressure on the company’s supply chain. The company has budgeted for roughly $500 million in capital expenditures this year, and plans to dedicate about 10% to 15% of that to supply chain partnerships and other related initiatives. Such spending would have made up less than 5% of the budget for capital expenditures before the pandemic. The company’s preference would be to set up new production lines in the US and Europe, according to CFO Donald Allan Jr.
  • Paul Graves, chief executive of lithium producer Livent, warned that "it will be a challenge for the lithium industry to produce sufficient qualified material in the near and medium term." Battery manufacturers may soon be paying more for the metal as a result. Forecasts call for lithium demand to increase from about 320,000 tons annually in 2020 to more than 1 million tons annually by 2025, when many automakers plan to launch new EV fleets, according to commodity pricing provider Benchmark Mineral Intelligence.
  • Demand for batteries used in consumer products is likely to increase if an expected post-pandemic surge in consumer spending is realized. Bloomberg Economics estimates that consumers have amassed about $1.7 trillion in savings since the beginning of the pandemic through January. That’s being bolstered by a new round of stimulus payments. Consumer spending during Q2 and Q3 2021 is likely to be the strongest such period in at least 70 years, according to economists at financial services firm Wells Fargo.
  • Input shortages are increasing for many firms partly because of pandemic-related congestion in freight transportation networks. A pandemic-driven shift in consumer purchasing habits from experience purchases to consumer goods purchases, particularly for the home, led to a dramatic increase in imports from Asian manufacturing centers, according to The Detroit News. The increase in imports resulted in backups at overwhelmed ports and freight hubs across the US. Businesses of all types are now forced to wait months instead of the usual weeks for deliveries, and no one knows when the situation will be resolved. The Fitch Ratings credit ratings agency said in its ‘Fitch Ratings 2021 Outlook: US Transport’ that the coronavirus pandemic will continue to be an impediment, even though performance will improve in 2021.
  • Some battery manufacturers are likely to benefit from the one-year extension of the 30% credit for installing electric vehicle chargers that was included in the federal stimulus package passed in December 2020. The credit is capped at $1,000 for home installations and $30,000 for businesses. The stimulus package also extended the 10% credit for two-wheeled plug-in electric vehicles, capped at $2,500 per vehicle.
  • Some communities are developing plans to capitalize on pandemic-driven attempts to re-shore industries that have been identified as essential. Hickory, NC, has allocated $90 million to attract these and other industries as part of a local revitalization plan. Targeted essential industries include battery manufacturing, pharmaceuticals, medical supplies and personal protection equipment, medical devices and testing equipment and products, medical and R&D labs, logistics and transportation parts and equipment, information and data storage, food production, and advanced textiles. Scott Millar, president of the Catawba County, NC, Economic Development Corporation, sees a trend, driven by the pandemic, for site selectors to opt for less densely populated areas instead of large urban metros.

June 25, 2021

  • Businesses including bed and breakfast inns are reopening at full capacity without social distancing restrictions just as a coronavirus variant that World Health Organization officials said is "faster" and "fitter" than previously identified ones begins spreading in the US. The Delta variant, which is believed to be more transmissible and cause more severe disease, could cause an upsurge in infections, but the levels will vary depending on the rates of vaccination in each area, said Scott Gottlieb, former commissioner of the US Food and Drug Administration. The Delta variant was first identified in India, which experienced a devastating surge in cases and deaths during May.
  • The Biden administration has said that there are no plans for a national vaccine passport or certificate of vaccination for the entire US, but states and foreign jurisdictions are taking positions on the matter. New York state, for instance, issues Excelsior Passes to residents who have been vaccinated or tested negative for COVID-19 so they can gain admittance to certain venues and events. Florida Governor Ron DeSantis, on the other hand, signed an executive order banning vaccine passports. The European Union is still developing official standards, while Israel requires fully immunized residents to furnish a paper or digital "Green Pass" to access public places like gyms, theaters and hotels.
  • About 77% of prospective travelers are less or much less concerned about travel safety for the second half of 2021 compared to the same period in 2020, according to a Global Rescue survey of more than 2,000 of its current and former members. The global vaccine rollout is helping boost consumer confidence, according to Global Rescue.
  • Tourism will not fully rebound in New York City (NYC) for at least four years, according to NYC & Company, the city’s tourism promotion agency. Bed and breakfast inns are likely to be among the businesses that are negatively impacted. NYC & Company counts all overnight guests and anyone who travels from more than 50 miles away as a visitor. Its new forecast calls for 38.2 million visitors in 2021, rising to 69 million by 2024. NYC drew a record 66.6 million visitors in 2019.
  • Many bed and breakfast inns have adopted the American Hotel and Lodging Association’s Safe Stay protocols and tailored them to small accommodations. Touchless check-in, in which guests are handed a sealed container with their room key, single-use bath amenities, and any other essentials that might otherwise be left in the room, is widely used. In-room nonessentials, such as pillows and shams, bed throws, and decorative figurines have been removed. "...owners are sacrificing some of their inns’ much-loved character to keep people safe," says Heather Turner, marketing director for the Association of Lodging Professionals.

July 2, 2021

  • On-premise draft beer trends continue to improve, according to Goldman Sachs. Jason English, an analyst for the investment bank, said that data from tech insights company BeerBoard showed that the percent of locations open and pouring beer stood at 92% for the weekend of June 17 to 20, up from 90% in January. The percentage of taps in use increased to 71% for the weekend, up from 70% in the two weekends prior. Total volume of beer served per location rose 1% sequentially nationwide. Total beer volume per location for the weekend of June 17 to 20 remained 36% lower than the same weekend in 2019, however.
  • The National Beer Wholesalers Association’s Beer Purchasers’ Index (BPI) increased to 80 in May from 79 in April. The strong recent performance is a notable reversal from the decrease to 63 in March from 70 in February. The BPI surveys distributors’ monthly buying behavior. An index of 50 points or more indicates that purchasing in a segment is expanding, while a reading below 50 indicates contraction. The fermented malt beverage/seltzer segment continued to outperform all other segments in May with a reading of 82. The craft index posted a strong reading of 65 while the regular domestic beer segment’s index was 48.
  • Many analysts say that beer distributors should prepare for an upcoming pandemic-related spending shift that is likely to boost on-site sales. Consumers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues.
  • Quick adjustments have been a key element of the successful response to the coronavirus pandemic, according to Lester Jones, chief economist for the National Beer Wholesalers Association. The market “kind of worked itself out” in response to the pandemic, Jones said. Home consumption increased where the restaurants, bar, and entertainment venue channels of trade left off. The beer industry managed to get the beer originally slated for on-side consumption in kegs repackaged in aluminum cans for at-home consumption. Cans of beer, typically 60% of the industry’s production, rose to 66-67%. Keg or draft beer sales, typically about 10% of the US beer market, decreased 50% during 2020. The total beer supply increased just 0.1% year over year in 2020. A lot of product was spoiled and destroyed in March and April 2020, the earliest days of the pandemic. The association has not yet done an accounting of the volume involved.
  • Demand for beverages of all kinds is rising during the coronavirus pandemic, but beer distributors may struggle to maintain adequate supply due to an aluminum can shortage. "Aluminum cans are in very tight supply with so many people buying more multi-pack products to consume at home," Coca-Cola spokesperson Ann Moore said. Can manufacturers have announced plans to build at least three new factories within the next 18 months. Can maker Ball Corp. will open two new US plants and is adding two new production lines to existing US facilities.

July 19, 2021

  • Former Anheuser-Busch InBev CEO Carlos Brito said that people want to return to pre-pandemic drinking routines. Brito, who retired on July 1 after 15 years leading the world's largest beer brewer, said AB InBev adjusted its supply chain to produce a more "normal balance" of bottles and draft beer, anticipating that home consumption would take a less prominent role.
  • Americans’ drinking habits – what they drink and how much – are about the same as they were pre-pandemic, according to new research conducted by Echelon Insights. The result is contrary to the widely-held assumption that people are drinking more during the pandemic. While 1 in 5 respondents reported drinking more, nearly the same amount also reported drinking less. Nearly 60% of respondents reported no change in their drinking habits since the pandemic began. These results are in line with other public polling from 2020 that showed most Americans reported drinking about the same during quarantine, including IUPUI, Morning Consult, and YouGov results.
  • Legislatures in Alabama, Arizona, Florida, Georgia, Illinois, Louisiana, Maryland, Michigan, Mississippi, Ohio, Texas, Virginia, Washington, and West Virginia have passed bills either extending or making permanent laws that allow alcohol delivery from restaurants, bars and, in some cases, liquor stores. While some of these bills are still awaiting governor signatures at the state level, some cities are also taking unilateral action or asking state houses for legislative action, including New York City. California, Massachusetts, Pennsylvania, South Carolina and Wisconsin are also among states with legislatures that have been debating similar moves in recent months.
  • Many analysts say that beer, wine, and liquor stores should prepare for an upcoming pandemic-related spending shift that is increasingly referred to as revenge shopping. Consumers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues. A significant portion of alcohol sales may shift from beer, wine, and liquor stores back to bars, nightclubs, and restaurants as a result.
  • Many distributors have made high-priced wines that are typically sold only to restaurants available to retailers at discounted prices, according to The Washington Post. Distributors typically make one yearly purchase of several pallets of wine (a pallet is 56 cases), then make deliveries throughout the year to one or more restaurants as needed. Distributors, stuck with these wines when restaurants closed, made them available at a heavy discount to retailers, as larger distributors tend to want to move that wine even at deep discounts, and smaller distributors may have an urgent need to move product. “There are some smoking-good deals for consumers, if they know what to look for,” says Jeff Leiker, a buyer for Tower Wine & Spirits in Atlanta. Distributors typically make one yearly purchase of several pallets of wine (a pallet is 56 cases), then make deliveries throughout the year to one or more restaurants as needed. Distributors, stuck with these wines when restaurants closed, made them available at a heavy discount to retailers, as larger distributors tend to want to move that wine even at deep discounts, and smaller distributors may have an urgent need to move product. “There are some smoking-good deals for consumers, if they know what to look for,” says Jeff Leiker, a buyer for Tower Wine & Spirits in Atlanta.
  • American adults say they’re drinking 14% more often during the pandemic, according to a report in the journal, JAMA Network Open. The World Health Organization (WHO) has advised limiting access to alcohol during the pandemic. “Alcohol compromises the body’s immune system and increases the risk of adverse health outcomes,” the WHO stated. “Therefore, people should minimize their alcohol consumption at any time, and particularly during the COVID-19 pandemic.”

July 2, 2021

  • Distribution of Eli Lilly's combination COVID-19 antibody drug was suspended by the US Food and Drug Administration due to the spread of coronavirus variants that weaken its potency. Laboratory tests show Lilly's drug is "not active" against variants known as Beta and Gamma, unlike rival drugs from Regeneron and Vir Biotechnology, according to a letter from the US Assistant Secretary for Preparedness and Response. The FDA has authorized two different Lilly COVID-19 antibody drugs for emergency use. Both have had trouble neutralizing certain variants, including the combination regimen that was specifically designed to counter the virus's evolutionary capabilities.
  • The biotechnology incubator that founded Moderna has launched another company focused on the therapeutic potential of messenger RNA, the single-stranded courier of genetic information that was key in the development of Moderna's COVID-19 vaccine. The company, Laronde, comes equipped with $50 million in funding from Flagship Pioneering and a lofty goal to upend how diseases are treated, through the use of so-called eRNA, or endless RNA. Laronde believes its eRNA platform can overcome challenges faced by other RNA technologies, as it has the potential to make medicines that are more stable, longer lasting, and that can be administered multiple times and in different ways.
  • Biotechnology research firms have begun developing vaccines that work against coronavirus variants. Dr. Noubar Afeyan, co-founder and chairman of Moderna, says that it is more likely than not that even those who are vaccinated will need some form of a booster to make antibodies against variants. Afeyan foresees a booster that would be a combination of half a dose of the existing vaccine and half a dose of a new variant vaccine.
  • Researchers at the Georgia Institute of Technology and Emory University are developing inhaled treatments that may be able to deliver a coronavirus vaccine. Treatments are delivered to the lungs via a nebulizer, which could make it simple for patients to administer at home. The researchers say that the treatments can be quickly modified to be effective against variants of contagions, including the new variants of the coronavirus that have begun to circulate.
  • There has been a massive pivot of biotechnology companies to pursue infectious disease research, according to Dr. Michelle McMurry-Heath, PhD, president and CEO of BIO. The complexity of COVID-19 disease has allowed a role for many types of drug mechanisms to be effective. Companies that pivoted to infectious disease work may have opportunities to pursue new classes of therapeutics and areas of research. There are 191 COVID-19 vaccine candidates and over 800 clinical trials for various treatments and vaccines, McMurry-Heath said, many under development by companies with no prior experience in the infectious disease space.
  • Industry experts say that a key challenge in vaccine development is determining which vaccine candidates should move forward through the costly clinical trial process. Running even a small study to test safety and dosing is beyond the reach of most academic groups, and smaller teams face an uphill struggle to get their candidates noticed. Scientists acknowledge that it would be a waste of resources to take every candidate to clinical trials. But they argue that it’s essential to have a diverse selection of COVID-19 vaccines in development.

July 2, 2021

  • Some hospitals are delaying or rescheduling surgeries because of a pandemic-related shortage of blood donations. Periodic, localized blood shortages are not uncommon, but this shortage is “unprecedented in its scope,” said Dr. Claudia Cohn, chief medical officer for the American Association of Blood Banks. The typical summer drop in blood donations at a time when surgeries are increasing because of procedures that were postponed during the pandemic may worsen the situation.
  • Blood and organ donations may rebound if the number of COVID-19 cases continues dropping as vaccination rates increase. Fewer than 20,000 new infections are being identified each day in early June, the fewest in nearly a year. About 42% of the country's population has been fully vaccinated as of June 7, and 51% has received at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention.
  • Blood banks are starting to move away from collecting plasma from COVID-19 survivors as vaccination rates increase, according to the Red Cross. Clinical trials are starting to show that plasma doesn't help much with COVID-19, and banks say they already have plenty of it.
  • The Food and Drug Administration (FDA) tightened its requirements for donors and recipients of COVID-19 convalescent plasma after reviewing findings from clinical trials. Some patients did not benefit from receiving convalescent plasma, according to the FDA review. Others only benefitted during specific circumstances. Those who received a COVID-19 vaccine can donate plasma if they have proof of a positive COVID-19 test result, received the vaccine after diagnosis, and are within six months after symptoms resolved, according to the updated guidance.
  • Blood banks are seen as a key player in a proposed global surveillance system that would check blood samples for the presence of antibodies to hundreds of viruses. The system would provide detailed, real-time information on how many people have been infected during a pandemic and how their bodies responded. It may also function as an advanced warning system that shows when large numbers of people start acquiring immunity to a particular kind of virus. Operators of the system would require agreements with blood banks and other sources of blood, and a system for acquiring consent from patients and donors.
  • Some blood banks are offering a free COVID-19 antibody test with any successful blood donation. The test can indicate whether someone was exposed to the coronavirus. Vitalant, the largest independent nonprofit blood collector in the US, began testing all blood donations for antibodies on June 1, 2020. Those who donate blood at Vitalant facilities will be able to see positive or negative test results about two weeks after completing successful blood donations by logging into private online donor accounts. The Vitalant antibody test, authorized by the US Food and Drug Administration, will indicate if donors’ immune systems have produced antibodies to the virus, regardless of whether they showed symptoms.
  • Red Cross is testing all blood, platelet, and plasma donations for COVID-19 antibodies. Red Cross said that it's using an antibody test that the US Food and Drug Administration has authorized for emergency use, and results will be available to donors within seven to 10 days in the Red Cross Blood Donor App or donor portal.

July 10, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Pandemic-related supply chain issues continue into peak boat sales season. Sailfish Boats president and CEO Rob Parmentier said that raw material and other shortages remain a problem industrywide. “We were on our way to trying to increase production 25 percent, and we’re doing everything we can to get more employees. Now we’re running out of parts and pieces,” he says. “That’s ubiquitous for all the bulk brands. We have engine issues, numero uno. Number two, or tied with number one, is chrome, resin, stringers. And believe it or not, marine heads — toilets.”
  • Boat building growth is expected to increase in mid-2021 after a slow start to the year and hold steady through 2023, according to ITR Economics.
  • Retail unit sales of new powerboats increased 12% year over year in 2020, according to the NMMA. More than 310,000 new powerboats were sold in 2020, levels the recreational boating industry has not seen since before the Great Recession in 2008.

July 10, 2021

  • Boat sales may be buoyed by a new surge in COVID-19 cases that may cause consumers to seek refuge from the pandemic. The US surpassed 20,000 new Covid-19 cases for the fourth day in a row on July 9. The last time the country had back-to-back days of cases topping 20,000 was in May. The highly contagious Delta accounted for 51.7% of cases in the US as of July 3, according to the US Centers for Disease Control and Prevention. "We know that the Delta variant has increased transmissibility and it is currently surging in pockets of the country with low vaccination rates," CDC Director Dr. Rochelle Walensky.
  • New boat sales, which reached a 13-year high in 2020, remain at elevated levels. Year-to-date sales through March 2021 increased 30% compared to the 2020 average, according to the National Marine Manufacturers Association (NMMA). Dealers are selling new boats as fast as they receive them at the start of peak boating season.
  • Inventory levels are tracking 20% to 60% below normal levels, according to NMMA director of business intelligence Vicky Yu. “Boatbuilders are shipping approximately 20,000 new boats monthly and operating at 13 percent above normal levels to restock anemic inventories ahead of peak selling season,” Yu said. “Continued supply chain disruption and workforce issues, combined with an average order backlog of up to six months, will challenge manufacturers to keep up with new orders through at least 2021."
  • Retail unit sales of new powerboats increased 12% year over year in 2020, according to The National Marine Manufacturers Association. More than 310,000 new powerboats were sold in 2020, levels the recreational boating industry has not seen since before the Great Recession in 2008.

July 2, 2021

  • Publishers continue experimenting with virtual publicity activities despite the recent reduction in new COVID-19 cases. Experts cite the ability of virtual events to create community, to enable teams within a media company to work together, and to increase interaction with authors as key reasons for continued interest in virtual publicity.
  • About 73% of consumers who typically visited shopping centers before the pandemic intend to return again after they have been vaccinated, according to a global survey by IBM's Institute for Business Value. Retailers should look to in-store promotions, which ranked as the most compelling reason for consumers to shop in a physical store, especially for Gen X (54%) and those over 55 (52%), according to the survey.
  • Cookbook sales increased 17% year over year in 2020, according to NPD BookScan, which tracks about 85% of US book sales. Experts attribute the growth to pandemic-related lockdowns that boosted home cooking. Some of the most popular guides were written by influencers on multiple platforms. “Half Baked Harvest Super Simple” by Tieghan Gerard, the Colorado food blogger whose Instagram account has nearly three million followers, reached number 7 on the BookScan list. “Salt Fat Acid Heat” by California chef and New York Times contributor Samin Nosrat became a Netflix show and was the fifth-best-selling cookbook on The New York Times best-seller list.
  • Some book publishers are racing to publish accounts of the coronavirus outbreak. Published works range from reported narratives about the science of pandemics and autobiographical accounts of being quarantined through spiritual guides on coping with grief and loss to a book about the ethical and philosophical quandaries raised by the pandemic. Upcoming works include examinations of the economic consequences of the pandemic, studies of the coronavirus, and histories of other pandemics.

July 19, 2021

  • Consumers are not returning to pre COVID-19 pandemic shopping behavior, according to  eMarketer. The market research firm predicts that “Even as stores reopen and brick-and-mortar sales rebound, we forecast that E-commerce will lose just a 0.1% share of total retail sales in 2021, before gaining more than 1 percentage point each year through 2024. Stores with both online and bricks-and-mortar sales channels may benefit most from the new shopping behavior.
  • Books offering a reflective look at the coronavirus pandemic are appearing in stores as the pandemic begins to fade. Publishers have released books detailing medical professionals' experiences, stories of those who lost loved ones to COVID-19, histories of coronavirus vaccine development, and other topics.
  • The American Booksellers Association had feared that hundreds of independent book stores could go out of business during the 2020-21 holiday season, but has tallied only 14 closings during the first five months of 2021, along with more than 70 in 2020.
  • Book store sales decreased 28.3% year over year in 2020, according to the US Census Bureau. Book store sales were lower despite an 8.2% year-over-year increase in print book unit sales, suggesting that many purchases moved online. Book store sales decreases generally eased as 2020 moved toward the end of the year: December sales decreased 15.2% following drops of 21.5% in November and 28.9% in October.
  • Print book sales rose in 2020 to the highest level since 2010, according to the NPD Bookscan, which tracks sales through about 80% of the market. Unit-sales volume for print books rose 8.2% year over year in 2020 to reach 751 million units. Every category posted gains, led by juvenile fiction print books, which saw sales rise 11%. Adult non-fiction print books, the largest category of books in the US by both volume and sales revenue, increased 4.8%, or 14 million units. Juvenile non-fiction grew 23%, also a gain of 14 million units.
  • It may take up to five years for retailers to absorb and integrate the acceleration of e-commerce into a new operating model that matches pre-pandemic retail profitability, according to management consulting firm Kearney. Many brick-and-mortar retailers layered more expensive e-commerce offerings and new customer service options, from curbside pickup to home delivery, on top of normal business operations, putting pressure on their already-stressed profit margins. Firms must now create sustainable business and operational models that can hold or increase margins once COVID-driven artificial demand vanishes, as the cost of added digital platforms will not vanish.
  • Sales at sporting goods, hobby, musical instrument, and book stores decreased 1.7% month over month on an adjusted basis but increased 11% year over year in June. Sales increased 44.6% year over year for the first half of 2021. Year-over-year figures may be distorted by the large, pandemic-related drop in sales during the same periods in 2020.

July 10, 2021

  • Businesses including bowling centers are reopening at full capacity and without social distancing restrictions just as a coronavirus variant that World Health Organization officials said is "faster" and "fitter" than previously identified ones begins spreading in the US. The Delta variant, which is believed to be more transmissible and cause more severe disease, could cause an upsurge in infections, but the levels will vary depending on the rates of vaccination in each area, said Scott Gottlieb, former commissioner of the US Food and Drug Administration. The Delta variant was first identified in India, which experienced a devastating surge in cases and deaths during May. Bowling Centers that have stopped following some pandemic-related safety practices may need to consider implementing them again. The Los Angeles County Department of Public Health advised all residents in late June to wear masks while they’re in public indoor spaces — even if they’re fully vaccinated against COVID-19.
  • Only about 2.4% of the US population lives in a county considered to have "high" transmission of coronavirus, according to an early June CNN analysis of data from the US Centers for Disease Control and Prevention. The CDC considers a county to have 'high' transmission if there have been 100 or more cases of Covid-19 per 100,000 residents.
  • The Centers for Disease Control and Prevention has issued guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings. Bowling centers are likely to benefit from the relaxed restrictions. Experts note, however, that interpretation of the guidance is likely to vary by state.
  • The Centers for Disease Control and Prevention said that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Bowling centers are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.

July 2, 2021

  • Maine’s COVID-19 vaccination clinics are targeting young people at breweries. The Federal Emergency Management Agency held a mobile vaccination clinic at the Rising Tide brewery in Portland, while MaineHealth sponsored a clinic at Maine Beer Company in Freeport. It’s important for young people to be vaccinated because they’re part of the demographic that’s being hospitalized, said Dr. Nirav Shah, director of the Maine Center for Disease Control and Prevention.
  • Craft breweries produced 23.1 million barrels of beer in 2020, about 9% less than in 2019, while total sales decreased 22%, to $22.2 billion, according to the Brewers Association (BA). It was the first production decline since the BA started tracking sale and volume numbers in the 1980s.
  • Brewery closures totaled 346 in 2020, on par with the previous year, but 716 new breweries opened. There is now an all-time high of 8,764 breweries operating in the US.
  • The coronavirus pandemic is driving consumer interest in buying beer directly from brewers, according to the Direct-to-Consumer Beer Shipping Report from Sovos ShipCompliant and the Brewers Association. About 84% of regular craft beer drinkers — defined as those who drink craft beer at least once per month — say that they want to be able to legally purchase beer via direct-to-consumer (DtC) shipping to their homes. About 73% of regular craft beer drinkers surveyed for the report said that the pandemic has increased their interest in purchasing craft beer via DtC shipping.
  • Some breweries and brew pubs are increasing investment in outdoor drinking areas as the weather gets warmer. The move may be influenced by experts' suggestions that pandemic-induced restrictions on indoor seating, which spurred the creation of minimal outdoor seating spaces as a matter of survival, may have normalized the practice of drinking beer outdoors. Crowded indoor spaces would take some getting used to again, and the new normal may see more consumers seeking outdoor dining and drinking options. Some cities have plans to help businesses maintain al fresco drinking and dining as a safe option. Solutions range from weatherized outdoor spaces, free tent and heater permits, and government-backed financial support.
  • Nonalcoholic beer sales increased 38% year over year in 2020 with $188 million in sales, according to market research company IRI. Industry experts cite increasing interest in wellness-related products and increasing quality and variety of nonalcoholic beers as key drivers of sales growth. Companies ranging from craft operations like Athletic Brewing to industry giants like Heineken are offering alcohol-free IPAs, coffee stouts, Oktoberfests, and more.
  • Breweries are likely to benefit from the addition of the Craft Beverage Modernization and Tax Reform Act (CBMTRA) to the $900 billion coronavirus relief package signed into law in late December 2020. The CBMTRA will make existing federal excise tax rates for small and independent breweries permanent. The current Federal Excise Tax rates for small and independent breweries, which were set to expire on December 31, 2020, could have increased as much as 100%.

July 9, 2021

  • Sales of previously-owned homes decreased 0.9% month over month but were up 44.6% year over year in May, according to the National Association of Realtors. It was the fourth straight month-over-month decrease. The year-over-year change is likely to have been affected by the large decrease in sales during May 2020 due to the coronavirus pandemic, and may not be indicative of future activity. "With four consecutive monthly declines in existing home sales, May's sales activity points to a potential moderation in growth for the remainder of 2021," said George Ratiu, senior economist at realtor.com.
  • Mortgage loan securitization organization Fannie Mae has decreased its housing sales forecast for 2021. Fannie Mae had forecast sales to be 6.9% higher year over year in February, but revised that down to 6.2% higher in March. The lack of supply and rise in mortgage rates were cited as key reasons for the revision.
  • Industry experts say that the digitization of licensing, permitting, and inspection services, which account for a substantial percentage of state budgets, represents the next phase of digital transformation in the public sector, and the coronavirus outbreak is accelerating the process. The city of Oakland, CA, for example, has launched a new application that allows people to schedule building inspections online. The Oakland Building Inspection Request application is expected to make it easier to schedule inspections and help the Planning and Building Department operate more efficiently. Customers using the app will get notified on the day of the inspection of the window of time the inspector will arrive, reducing long wait times for customers.
  • The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, increased to 114.7 in May from 106.2 in April, according to the National Association of Realtors. An index of 100 is equal to the level of contract activity in 2001. It is the highest reading for the month of May since 2005. Contract signings increased 13.1% year over year in May, but the large year-over-year change is likely to be due in large part to the pandemic-induced lockdown in 2020.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • The COVID-19 pandemic and related recommendations for social distancing have altered the way building inspection service providers operate. Home sellers became reluctant to allow strangers, including inspectors, into their homes for two to three hours, while stay-at-home orders in many states complicated the ability to perform physical inspections, which were often part of contractual obligations with deadlines.

July 2, 2021

  • The price of lumber decreased to $750 per thousand board feet on July 2 from the record high of $1,645 per thousand board feet on May 5. Lumber prices have oscillated widely during the coronavirus pandemic, falling from the mid-$400s in January to $264 in late April 2020 before surging to $948 in September. The price then dropped to $495 in late October before returning to the $800s in December.
  • The Associated Builders and Contractors (ABC) trade association expects a "... tsunami of economic and employment growth across America." The US may end up growing faster than China this year due to federal stimulus spending, according to ABC Chief Economist Anirban Basu. "Much of the stimulus to come will directly affect construction. While any infrastructure stimulus should be geared toward projects generating the highest rates of return and open to bids by all competent contractors, the sheer volume of money flowing into the economy is set to create massive forward momentum for the balance of 2021 and likely through 2022," Basu added.
  • Pandemic-induced rapid product pricing and production changes, coupled with somewhat diminishing ability to use historical trends in predicting seasonal or cyclical market direction, are driving the need for closer partnering with suppliers and customers to ensure adequate inventory, according to Steve Hansen of Professional Builders Supply. Purchasing strategies that feature collaboration and better communication with customers and suppliers can maximize product availability and margins throughout the entire supply chain from mills to builders, Hansen said.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.
  • Construction industry experts expect a surge in commercial renovations in 2021 due to tax changes included in the 2020 CARES Act. Facility upgrades qualified for tax deductions before the passage of the CARES Act, but to reap the full benefits, facility managers would have to claim a 2.5% write-off each year for up to 39 years. With the passing of the 2020 CARES Act, facility managers can write off 100% of qualifying facility improvement costs in the first year. A few improvements that qualify for the tax deduction are the installation of airflow management accessories, HVAC devices, and physical security and access control solutions.

July 1, 2021

  • Business and professional associations undertook risk assessments to determine the best ways to provide services during the coronavirus pandemic. Some associations extended membership terms at no cost to support and retain members. Industry experts say that associations whose normal activities have been suspended may still be able to support members by helping with processes like applying for economic injury and disaster loans or providing up-to-date information on coronavirus response measures and legislation.
  • Business and professional associations can apply for loans through the emergency Economic Injury Disaster Loan (EIDL) program. Loan funds can be used for working capital and normal operating expenses. The EIDL Advance program - which offered grants for eligible businesses and nonprofits for payroll, rent, mortgage payments, or repaying obligations – was shut down in July after dispersing its total allotment of $20 billion. However, in late December the COVID-19 Targeted EIDL Advance program was authorized as part of the Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act. Targeted EIDL Advance offers advance funds of up to $10,000 for applicants in low-income communities. In late 2020 the deadline for applying for the COVID-19-related EIDL program was extended to December 31, 2021.
  • Early in the pandemic, the American Society of Association Executives (ASAE) asked lawmakers for additional assistance for associations that suffered financial losses when events and meetings were cancelled, access to Small Business Administration loans to maintain payroll, and the creation of a federally-backed pandemic risk insurance program. Under the CARES Act, 501(c)(6) groups could only receive Payroll Protection Program (PPP) loans if lobbying accounted for less than 10% of their activities. A second round of stimulus relief was passed in December. The $900 billion spending bill included more than $284 billion for first and second forgivable Paycheck Protection Program (PPP) loans, and increased the threshold for lobbying activities from 10% to 15%. However, only organizations with less than $1 million in lobbying spending were eligible for PPP loans. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan (ARP) Act which included an additional $7.25 billion for PPP. The PPP funding is available to nonprofit entities that employ 300 or fewer employees per physical location. The ARP’s provisions regarding lobbying are the same as the ones in the prior stimulus package passed in late December. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • With more widespread availability of vaccines comes the potential of resuming in-person events. In March, the ASAE announced its 2021 Annual Meeting & Exposition will be held virtually in August. However, the virtual event will be supplemented by smaller, regional in-person hub meetings that can be held safely. As of June 30, 2021, all but two states were fully reopened, according to The New York Times. On June 30, the 7-day average for daily new cases was about 11,000 – or about half of what they were a month earlier.
  • Business associations have been urging lawmakers to pass legislation to protect businesses from lawsuits related to COVID-19. Most of US states either have passed some protections – primarily for the healthcare industry – or have legislation pending. Legal experts suggest a compromise on the federal level is necessary to strike a balance between protections for workers and businesses. A patchwork of state regulations could complicate compliance for businesses operating in numerous states. The stimulus package passed in December did not include liability protections, nor does The American Rescue Plan Act which was signed by President Biden in March 2021. Given the issue’s lack of traction on the federal level, proponents of COVID-19 immunity provisions are expected to focus their efforts on the states.
  • Business and professional organizations may provide their members with resources that help them develop policies based on updated government guidance for encouraging and/or requiring employees to be vaccinated. In late May 2021, the Equal Employment Opportunity Commission (EEOC) updated its guidance for employers as to when and under what circumstances they can require employees to be vaccinated for COVID-19 or offer incentives to employees who receive vaccines. Under the EEOC guidance, employers generally may require employees entering the workplace to be vaccinated unless the worker has a disability or sincerely-held religious belief that prevents them from getting vaccinated. In such cases, the employer must make “reasonable accommodations” that include wearing a mask, remote work, social distancing, periodic COVID-19 testing, working a modified shift, and/or accepting a reassignment. The EEOC notes it is unlawful under the Americans with Disabilities Act (ADA) to disclose that an employee has received a reasonable accommodation. Employers may also offer incentives for employees to become vaccinated. However, if vaccines are administered by the employer or its agent, incentives must not be “so substantial as to be coercive.” There are no limits on incentives for employees who get vaccinated by third-party providers, such as a pharmacy, state-run vaccination center, or the employee’s personal physician.
  • Las Vegas played host to the World of Concrete (WOC) trade show June 8-10 2021, the first major industry trade show to have a large, in-person event since the onset of the pandemic, according to the Trade Show News Network. While the event was smaller than in years past, it attracted 650 exhibiting firms. Las Vegas lifted all pandemic restrictions on June 1, but the WOC show still adhered to safety guidelines, including an 80% capacity cap in all shared and common spaces, and thermal scanning. Masks were recommended but not required. Trade show industry watchers expect trade show bookings and attendance to rise along with vaccinations.

July 18, 2021

  • The pandemic-driven pivot to e-commerce has reduced impulse purchases of items like candy, according to market research firm Euromonitor. North American sales of gum decreased 14% by volume year over year in 2020, and mints decreased 15%. Fewer people have been standing in line at the grocery store, an optimized selling environment in which products considered to be impulse purchases are carefully placed where customers are likely to pick them up while waiting to pay.
  • Chocolate sales increased 4.2% year over year in 2020, according to the National Confectioners Association (NCA). Premium chocolate sales increased 12.5% year over year between March and August 2020, compared with a 5.5% increase for the chocolate market overall, the NCA said. Much of the industry’s growth was fueled by increased foot traffic in grocery stores, where sales of premium chocolate jumped 21.4%.
  • Pandemic-induced stress resulted in higher consumption of sugar and fatty foods, particularly among women, according to a study published in the journal Appetite. "These changes are likely due to the circumstances surrounding COVID-19, including stay-at-home orders, decreased job security, anxiety about exposure to the virus, and food shortages," researchers noted in the study. Americans have been indulging more during the pandemic. A separate study conducted by OnePoll that asked 2,000 Americans about their eating habits found that three-quarters were eating higher-calorie foods like ice cream and candy while in isolation.
  • About 64% of respondents to a FMCG Gurus survey said that their confectionery product buying habits will change as a result of COVID-19. About 51% of consumers say they will trade-up on confectionery to compensate for reduced expenditure elsewhere. 52% say they will seek confectionery products suitable for "big nights in." About 79% have purchased more comfort food such as ice cream and confectionery, 40% said they purchased more chocolate as a result of COVID-19, and 28% said they purchased more sugar confectionery.
  • Industry experts in supply chain management are offering options for dealing with input shortages during the coronavirus pandemic. A common recommendation is to ask suppliers to do a double production run of inputs so the next run can wait twice as long. Manufacturers may also offer early payment, so the supplier can have more cash on hand during these uncertain times. Another option is having a supplier produce only primary SKUs, as retailers are likely to be understanding if you’re only able to supply those items.

July 16, 2021

  • The US is averaging about 25,300 new cases per day in mid-July, more than double the 11,300 per day the week of June 22. Cases were increasing in 48 states- all but Iowa and South Dakota – on July 15. Los Angeles, CA, officials issued an order on July 15 requiring all residents to wear masks in indoor public spaces. Low vaccination rates, the relaxation of mask rules and other precautions, and the swift spread of the more-contagious Delta variant are blamed.
  • Cannabis producers may be negatively impacted if increasing new COVID-19 case numbers result in lower foot traffic in dispensaries, as producers are heavily reliant on in-store demonstrations and “swag” giveaways because they face many advertising restrictions. “There’s nothing better than having our people in the store making good noise for our brand and educating people, whether that’s customers or budtenders or store managers or purchasing managers,” said Dan Gardenswartz, chief operating officer at Spherex, which extracts THC and makes vaporizer products.
  • Pandemic-related business adaptations led to increased risks for cannabis businesses, according to industry experts. The expansion into delivery caused by the pandemic restrictions included pros and cons. Some states had an independent license regime for delivery that helped smaller businesses operate in the sector. Curbside delivery and drop-off expose employees to increased workers comp and theft exposures, however. The added cost to insure the potential new exposures can be “pricey”, according to Jim McErlean, director of business development at Cannasure Insurance Services.
  • Global sales of cannabis increased 48% year over year to nearly $21.3 billion in 2020 despite the coronavirus pandemic outbreak, according to cannabis data analytics firm BDSA. US sales increased 46% year-over-year. The US cannabis industry added an estimated 77,300 jobs in 2020 — more than twice the number it added throughout 2019, according to Leafly's 2021 jobs report.
  • The technology and automation that cannabis cultivators relied on to cut costs before the COVID-19 pandemic is expected to be key to surviving the following economic downturn. Producers that invested in automated systems for managing watering, fertilizing, lighting, irrigating, climate, and for rolling and filling joints were able to reduce labor costs. Successful commercial growers already ran clean, hospital-grade operations pre-COVID-19.
  • California is offering marijuana companies a mix of tax extensions, relief, and deferrals to help firms maintain operations and meet payroll, according to Marijuana News. Many businesses were denied loans in the first round of stimulus funding, according to Marijuana Daily. Some industry leaders argue that hemp businesses should be entitled to COVID-19 stimulus relief because hemp is not a controlled substance.
  • Most states that allow cannabis production have classified the industry as an essential business. Despite maintaining the ability to stay open, several large cannabis companies, including Acreage Holdings and 4Front Ventures, scaled back in anticipation of an economic downturn.

June 25, 2021

  • Since April 2020, vehicle miles traveled has gradually increased as more states fully reopened, according to traffic data from the Federal Highway Administration. Geopath – a firm that measures vehicle traffic for out-of-home media – reported that weekly miles traveled in April 2021 were 67% higher than they were in April 2020. During the same period, the number of car trip requests on Apple Maps increased 131%. Aided by wider vaccine distribution, daily new COVID-19 cases have dropped since the spike seen in mid-January. As of June 23, the 7-day average for daily new cases was about 11,000, less than half of what they were just a month before. Hospitalizations and deaths were also down significantly. In May 2021, the Centers for Disease Control and Prevention (CDC) issued new guidelines suggesting fully vaccinated people can resume normal activities without wearing a mask or physically distancing.
  • Car washes may make several changes to ensure operations are safe for employees and customers. Steps may include reducing waiting room occupancy, outfitting employees with personal protective equipment (PPE), installing plexiglass shields around cashier stations, limiting washes to vehicle exterior, restricting employee and customer interaction, and eliminating manual prep and post-wash wipe down. Other strategies include eliminating cash transactions, allowing customers to position vehicles on conveyors and remain in their cars during washes, and employee temperature checks.
  • Car wash firms that offer unlimited wash subscriptions have fared better during the pandemic than car washes that don’t offer subscriptions, according to data released in November by car wash software and equipment firm DRB Systems. During the first wave of the pandemic (March 22, 2020 to May 18, 2020), car washes that offer subscription plans saw a 32% drop in revenue compared the pre-pandemic period (Jan 1, 2020 to March 21, 2020). Car wash firms that did not offer unlimited washing plan experienced a 66% decline in sales during the first wave of COVID-19. Car washes have long offered subscriptions to help smooth out revenue over the course of the year, and have also helped during economic downturns. Subscriptions are also completely touchless. Customers typically sign up via app or website and enter their license plate number and payment info. When the customer visits the carwash, an automated POS system reads the license number and processes payment with zero human contact.
  • Mergers and acquisitions (M&A) activity in the car wash industry is usually robust during periods of economic growth. The US economy was fundamentally healthy prior to the COVID-19 crisis. Despite the pandemic, existing car wash industry participants and fresh outside capital increased their investments in the industry in 2020, according to Car Wash Advisory. Investment remained robust amid low interest rates and the overall attractiveness of potential return yields relative to other alternative investments. Car Wash Advisory expects M&A activity in the industry to remain robust in 2021 and beyond.
  • The COVID-19 outbreak slowed the circulation of coins in the US economy which created problems for several coin-dependent business, including coin-operated car washes. During the quarantine, not only did retail activity drop but consumers stopped cashing in their coins for paper notes. The US Mint also slowed coin production in the early days of the pandemic to protect workers. Consumers’ shifting to contactless payment options also reduced coin circulation. In June 2020, the Federal Reserve put allocation limits on the amount of coinage depository institutions could order, according to Coin World. Over the next several months the coin shortage improved as the US Mint increased coin production and the Federal Reserve lifted allocation limits. However, coin orders from depository institutions increased significantly in March and April of 2021, outpacing US Mint production and resupply from bank deposits. In early May the Federal Reserve reinstated allocations restricting depository institutions’ orders of quarters and dimes. The Fed has said there isn’t a shortage of coins, but rather much of the coin supply is “sitting dormant” in consumers’ homes and is not being circulated. Until more consumers cash in their coins, cash-dependent businesses may continue to have trouble obtaining enough coins.
  • Car washes that saw business drop off during the pandemic may have sought relief via the reauthorization of the Paycheck Protection Program (PPP). The PPP was revived with the December passage of the $900 billion COVID-19 Economic Stimulus Relief Act. The legislation included $300 billion in funding for Small Business Administration (SBA) loans. The December round of PPP let eligible borrowers get a second draw loan. It also simplified loan forgiveness for loans under $150,000 and makes forgiven loans tax deductible. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act which included an additional $7.25 billion for PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • More driving during the summer of 2021 may help boost demand for auto repair shops as motorists get current on routine maintenance, such as oil changes, prior to road trips. Driven in part by optimism brought on by vaccine availability as well as stimulus checks, gasoline consumption during the summer 2021 driving season (April-September) is expected to average 9.1 million barrels per day (b/d), which is 1.3 million b/d more than last summer, according to the US Energy Information Administration (EIA). However, gasoline consumption this summer will still be lower than in 2019.

June 25, 2021

  • As offices reopen, tech companies are introducing cleaning scheduling apps to help office managers gather bids from qualified cleaning firms. The Onedesk Office Cleaning Platform allows cleaning firms to do a virtual walkthrough of an office space and bid on the job without having to visit the location. Carpet and upholstery cleaning firms may seek to become pre-vetted vendors for such apps.
  • Some carpet and upholstery cleaning firms quickly added new disinfecting services to meet the needs of commercial customers that are reopening. Some use disinfecting fogs and mists that can be efficiently applied with no wiping. However, cleaning companies that promote their services to disinfect against coronavirus can open themselves to liability if workers are without proper training, equipment and chemicals. Additional guidance regarding COVID-19 issued in early April 2021 by the Centers for Disease Control and Prevention (CDC) suggests the virus primarily spreads through the air. The agency said, “It is possible for people to be infected through contact with contaminated surfaces or objects (fomites), but the risk is generally considered to be low.” The CDC said further studies “suggest that the risk of SARS-CoV-2 infection via the fomite transmission route is low, and generally less than 1 in 10,000, which means that each contact with a contaminated surface has less than a 1 in 10,000 chance of causing an infection.” The CDC also concluded “some types of disinfection applications, particularly those including fogging or misting, are neither safe nor effective for inactivating the virus unless properly used.”
  • Carpet and upholstery cleaning firms need to reassure customers that cleaning practices and equipment are safe to bring into their properties. Firms are encouraged to outline infection prevention in their proposals, assess their equipment performance, look professional, be transparent with clients, communicate cleaning protocols, and re-brand with language around infection prevention.
  • The Building Service Contractors Association International (BSCAI) has developed a COVID-19 protection training and certification course for cleaning professionals. The course covers proper cleaning procedures, infection control, worksite safety precautions, and documentation and communication protocols. It also follows all CDC, OSHA, and EPA guidelines. Carpet and upholstery cleaners may want their employees to complete third-party certifications to assure customers the company’s services follow accepted best practices.
  • Industry insiders suggest companies that offer coronavirus-related cleaning and disinfecting services check to ensure their insurance policies cover them in the event of a COVID-19-related claim by a customer or employee. Some cleaning and restoration companies that perform COVID-19 decontamination services found their insurance didn’t provide adequate coverage. Some insurance companies have created new biohazard coverage or added it to existing policies.
  • As the pandemic has worn on, building and property managers have become more educated about the differences between cleaning and disinfecting. They are also becoming more aware of remediation firms that may unfairly increase the price if the job requires disinfecting a space where there have been confirmed cases of COVID-19. Carpet cleaning firms that offer disinfecting services should offer price transparency and ensure their products, equipment, and certifications are appropriate for viral mitigation.
  • In November, the Occupational Safety and Health Administration (OSHA) issued guidance to help employers understand compliance issues resulting in citations that are most common during OSHA inspections. The issues included: providing a medical evaluation before a worker is fitted with a respirator; development and implementation of worksite procedures for respiratory protection; ongoing training for PPE and respirator use; proper PPE and respirator storage that prevents damage and contamination; keeping required records for all work-related injuries, illnesses, and fatalities.
  • Carpet and upholstery cleaning firms that saw business drop off during the pandemic may have sought relief via the reauthorization of the Paycheck Protection Program (PPP). The PPP was revived with the December passage of the $900 billion COVID-19 Economic Stimulus Relief Act. The legislation included $300 billion in funding for Small Business Administration (SBA) loans. The December round of PPP let eligible borrowers get a second draw loan. It also simplified loan forgiveness for loans under $150,000 and makes forgiven loans tax deductible. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act which included an additional $7.25 billion for PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • Rising vaccination rates and falling new cases of COVID-19 are expected to lead to a wider reopening of America’s office spaces, which would likely create increased demand for commercial carpet cleaning services. As of June 23, 2021, more than 150 million people were fully vaccinated, or about 45% of the US population, according to the Centers for Disease Control and Prevention (CDC). As of June 23, the 7-day average for daily new cases was about 11,000, less than half of what they were just a month before. Hospitalizations and deaths were also down significantly. In May 2021, the CDC issued new guidelines suggesting fully vaccinated people can resume normal activities without wearing a mask or physically distancing. Reopening will look different for each office. Some corporate cultures prefer everyone back in the office fulltime. Other offices may phase workers back in more slowly or offer hybrid schedules to employees who would like to keep working from home part of the time. It remains to be seen if foot traffic in offices – and pre-pandemic carpet cleaning schedules – ever return to normal.

June 25, 2021

  • The Mohegan Tribal Gaming Authority is suing its insurance carrier over what it says was the denial of claims for millions of dollars in losses at its Mohegan Sun casino that were caused by the COVID-19 pandemic. Analysts say that that the lawsuit is similar to one that the Mashantucket Pequot Tribe, owner of the Foxwoods Resort Casino, brought against the same insurer in February. The Mashantuckets say in their lawsuit that more than $76 million in losses caused by pandemic-related closures at Foxwoods and other properties they own, including a spa, museum, and golf course, should be covered under its “all risk” policy. The insurer said in a court filing in the Mashantucket case the that losses caused by viruses and contamination are specifically excluded from the casino’s policy, and is seeking to have that case dismissed.
  • Commercial gaming revenue nationwide increased 17.7% year over year during Q1 2021 to $11.13 billion, according to the American Gaming Association. Gaming revenue was up 4% from Q1 2019, and was within a tenth of a percent of the highest quarterly revenue total in the history of US gaming.
  • AGA noted that the $11.13 billion generated from gaming during Q1 occurred despite pandemic-related limitations on live entertainment, dining, hotel bookings, and meetings and conventions that are essential to the industry’s bottom line.
  • The Centers for Disease Control and Prevention has said that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Casinos and casino hotels are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • About 77% of prospective travelers are less or much less concerned about travel safety for the second half of 2021 compared to 2020, according to a Global Rescue survey of more than 2,000 of its current and former members. The global vaccine rollout is helping boost consumer confidence, according to Global Rescue.

June 24, 2021

  • Legislation that would add another $60 billion in a second round of relief to Restaurant Revitalization Fund (RRF) has been introduced in the US Congress. The Restaurant Revitalization Fund Replenishment Act of 2021 amends the American Rescue Plan Act of 2021 to increase appropriations to the original Restaurant Revitalization Fund, and for other purposes. Funds distributed to restaurants in the RRF’s first round were prioritized for women, veterans, and economically and socially disadvantaged groups, during its first 21 days. This was later challenged in court, as this policy depleted most of the funds. The $60 billion replenishment round more than doubles the original’s allocation.
  • The Knot Worldwide expects a 20% to 25% increase in weddings in 2021 and into 2022. About 47% of those 2021 weddings are expected to occur between July and October. Demand for catering services is likely to increase as a result. Nearly half of the couples (47%) who planned to marry in 2020 but postponed have rescheduled for 2021 and later dates. A majority of couples who got engaged during the pandemic (73%) also set their wedding date for 2021. A third of couples who married in 2020 expect to have big celebrations when the Centers for Disease Control and Prevention ends restrictions larger gatherings.
  • Caterers that have pivoted toward dropping off food for business or social gatherings — rather than providing full service at events — have suffered, according to Melissa Wilson, principal at research firm Technomic. “One of the bigger financial challenges in catering is, when you offer a full service, from bartenders to servers to people cleaning up, you are able to charge way more and make more profit than you ever can dream of,” explained caterer Christine McEnery. “When you’re dropping things off in Tupperware, there’s a huge change in the customer’s perception of value.”
  • Outdoor weddings alleviate some of the concerns related to COVID-19. “Outdoors will be one of the safest ways to host a wedding for a variety of reasons. First, you have fresh air at all times, so the air is not being moved around by air conditioners, thus keeping the air at the party fresh. Also, when you have a tented wedding, you can make the tent larger to allow for more social distancing between tables. Ballrooms [can be] too restrictive when it comes to requiring more space,” stated the owner and planner of Elegant Occasions by JoAnn Gregoli.

July 17, 2021

  • New COVID-19 cases were increasing in every state in mid-July, according to data aggregated by Johns Hopkins University. Construction activity may slow if pandemic-related safety measures are re-imposed. Some states saw new cases double within a week. Health experts cite low vaccination rates, the relaxation of mask rules and other precautions, and the swift spread of the more-contagious Delta variant as key causes of the increases.
  • The upward trend in national statistics is being driven almost entirely by outbreaks in places with low vaccination rates, such as the Ozarks, Florida, and parts of the Mountain West. Some counties, especially in Missouri and Arkansas, are recording more cases now than they did during the winter. "There is a clear message that is coming through: This is becoming a pandemic of the unvaccinated," said Centers for Disease Control and Prevention director Dr. Rochelle Walensky.
  • The daily average number of new US cases stood at 28,315 on July 15, according to a New York Times tracker, up 121% from two weeks earlier. Hospitalizations and deaths, though well below levels seen at the peak of the pandemic, are also rising, with 20,952 patients in hospitals on July 15, up 26% from two weeks earlier, and 280 fatalities, up 9%, the tracker shows.
  • Centers for Disease Control and Prevention director Dr. Rochelle Walensky noted on July 16 that unvaccinated people accounted for over 97% of hospitalizations. More than 99% of recent deaths were among the unvaccinated, infectious disease expert Dr. Anthony Fauci said in early July.
  • Martin Marietta's Rocky Mountain Ready Mix District plans to transition employees back to the office once Covid-19 vaccinations become more prevalent and the majority of the workforce is vaccinated. The company is following CDC guidelines for reopening. While the transition will mark a return to pre-pandemic operations for the materials provider, the protocols and technologies adopted since March 2020 will remain.
  • The Associated Builders and Contractors (ABC) trade association expects a "... tsunami of economic and employment growth across America." The US may end up growing faster than China this year due to federal stimulus spending, according to ABC Chief Economist Anirban Basu. "Much of the stimulus to come will directly affect construction, particularly the heavy and civil engineering segment. While any infrastructure stimulus should be geared toward projects generating the highest rates of return and open to bids by all competent contractors, the sheer volume of money flowing into the economy is set to create massive forward momentum for the balance of 2021 and likely through 2022," Basu added.
  • The transportation construction market is expected to shrink 5.5% in 2021, according to the American Road & Transportation Builders Association (ARTBA). The reduction will be driven primarily by the severe economic recession caused by the coronavirus pandemic. Overall, the value of work is expected to drop from $294.2 billion in 2020 to $278.1 billion in 2021. ARTBA cautions that overall transportation construction activity will vary across the country as states deploy different strategies to balance their budgets and manage debt. States are expecting shortfalls in transportation revenues of anywhere from $35 billion to $40 billion through 2024, according to ARTBA.
  • Total construction starts will increase 4% in 2021, according to Dodge Data & Analytics. "The dollar value of starts for residential buildings will increase 5% in 2021, nonresidential buildings will gain 3%, and nonbuilding construction will improve 7%. Only the residential sector, however, will exceed its 2019 level of starts thanks to historically low mortgage rates that boost single family housing,” said Richard Branch, Chief Economist for Dodge Data & Analytics.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Spending on nonresidential building projects is declining and will do so through 2021, according to a mid-year update to the American Institute of Architects’ (AIA) Consensus Construction Forecast. The AIA estimates an 8% spending drop in 2020 and just under 5% in 2021 due to pandemic-induced economic disruptions. This is the first time in nearly a decade that nonresidential construction spending has trended downwards, according to the AIA.

July 13, 2021

  • Charter bus services may need to wait longer for a rebound in ridership. The US surpassed 20,000 new Covid-19 cases for the fourth day in a row on July 9. The last time the country had back-to-back days of cases topping 20,000 was in May. New cases were at least 50% higher week over week in 34 states for the week ending on July 11. The highly contagious Delta accounted for 51.7% of cases in the US as of July 3, according to the US Centers for Disease Control and Prevention. "We know that the Delta variant has increased transmissibility and it is currently surging in pockets of the country with low vaccination rates," CDC Director Dr. Rochelle Walensky.
  • US Education Secretary Miguel Cardona said in early May that he expects all schools to be open full-time in person for all students in the fall. Demand for charter bus services by schools may revert to pre-pandemic levels if the expectation is met.
  • Charter bus company Storer Coachways has converted their busses into full-service mobile coronavirus testing sites. Clinicians can administer and collect up to 700 COVID-19 tests a day on the busses. The first bus went into service as a testing site in December 2020 and 15 busses, 13 full-sized charter busses and two mini mobile units that can be used across 15 California counties, were available by early March. Storer Coachways Vice President Sarah Storer says that the busses can eventually be used as mobile vaccine sites and, when the pandemic ends, Bus Test Express will continue to serve as medical clinics.
  • The drop in bus travel is raising concerns about the potential long-term damage to an essential transport method for millions of lower-income consumers. Greyhound said that it is operating less than half its normal bus routes during the pandemic, while revenues have fallen nearly 60%. The American Bus Association (ABA) estimates that 85% of the 100,000 people who work in the bus industry have been laid off or furloughed — in most cases since March.
  • The charter bus industry will lose $11 billion, almost 75% of typical annual revenue, because of the coronavirus pandemic, according to the ABA.
  • Some of the same concerns that consumers have regarding air travel extend to bus transport. As a result, the charter bus industry is promoting its equipment safety features including seats that are high-backed and facing forward as limiting transmission risk. It’s also informing consumers about airflow and filtration systems that circulate fresh air.

July 8, 2021

  • Global business aviation activity in June 2021 was up 10% compared to June 2019, according to WingX. US business aviation departures over the 2021 Fourth of July weekend were 44% higher than the same weekend in 2019. Popular destinations included the Bahamas, Mexico, and Las Vegas. Business aviation in Europe also got a lift in June as there were 2% more business aviation flights than in June 2019. Tourism in Greece and other Mediterranean destinations drove the strongest growth. France was led Europe in departures and was back to levels seen in summer 2019, but UK demand was off 21% compared to June 2019. Outside the US and Europe, June business jet activity was down about 4% compared to June 2019. Global business aviation activity in the first six months of 2021 was only down 4% compared to the same period in 2019, and increased 42% compared to the first six months of 2020.
  • As of July 1, 2021, all US states but Hawaii were fully reopened, according to The New York Times. On July 6, the 7-day average for daily new cases was nearly 13,000 – down slightly from the levels seen a month earlier. Amid falling rates of new COVID-19 cases and improved vaccination distribution, the European Union (EU) on May 19 announced it would reopen its borders and admit vaccinated travelers. The EU member states not already open to US tourists opened in mid-June. Most EU countries will require proof of vaccination, a recent negative COVID-19 test, or evidence showing recovery from the disease, according to The Wall Street Journal. In late June, the UK said that over the summer it would gradually reduce its quarantine requirements for vaccinated travelers from approved countries, including the US. A broad ban on international travel to the US has been in place since January.
  • Firms are dedicating each pilot/crew to a plane rather than shifting crews across the fleet of aircraft in order to limit their exposure. Private jets also spend much less of their time in the air than commercial ones, leaving plenty of time on the ground for sanitizing aircraft interiors between flights. Fractional ownership jet companies NetJets and FlexJet have both announced they will fly pilots to and from their rotation shifts on their own fleets instead of having them fly commercially. Some companies also plan to test all their crews for COVID-19 to reassure passengers.
  • A study by Globe Air found that commercial passengers can experience as many as 270 person-to-person contacts while private flight passengers experience about 20. Concerns about coronavirus could improve consumers’ value perceptions about private flights.
  • Publicly traded companies are increasingly listing coronavirus among their risk factors in SEC filings. Companies may spend more for private travel to keep important executives safer, according to Forbes. However, the shift to at-home work and video conferencing for sales pitches and staff meetings are causing many executives to re-think their business travel budgets, according to the Wall Street Journal. Industry insiders have estimated it will take several years for business travel to return to pre-pandemic levels. Delta Airlines estimates that by 2023, business travel will be close to 70% of what it was before the pandemic.
  • Pent-up demand for travel may boost charter flight activity over the summer as more of the US – and the world – are reopening. According to a spring 2021 survey by Deloitte, 40% of Americans plan to take a trip that includes a flight and a stay in paid lodging between Memorial Day and the end of September. Travel intent levels were about the same as they were to pre-pandemic travel in the summer of 2019. Of respondents who plan to travel, 60% said they plan to spend about the same amount on summer trips as they did in 2019.

July 12, 2021

  • US chemical distributors may face higher costs for and increasing shortages of imported chemicals due to a wave of Covid-19 clusters in Asia that is creating new bottlenecks in the global supply chain, according to The Wall Street Journal. Increasing competition for space on container vessels that ship goods around the world has sent freight rates soaring. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries, and increasing numbers of new COVID-19 cases in those areas may trigger re-implementation of social distancing measures that slow the movement of goods. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit.
  • Domestic shipping costs are also increasing for many firms, including chemical distributors, partly because of pandemic-related congestion in freight transportation networks. A pandemic-driven shift in consumer purchasing habits from experience purchases to consumer goods purchases, particularly of items for the home, led to a dramatic increase in imports from Asian manufacturing centers, according to The Detroit News. The increase in imports resulted in backups at overwhelmed ports and freight hubs across the US. Businesses of all types are now forced to wait months instead of the usual weeks for deliveries, and no one knows when the situation will be resolved. The Fitch Ratings credit ratings agency said in its ‘Fitch Ratings 2021 Outlook: US Transport’ that the coronavirus pandemic will continue to be an impediment, even though performance will improve in 2021.
  • US chemical production increased in May after decreasing in the previous three months on gains in all chemical producing regions, according to the American Chemistry Council. The US Chemical Production Regional Index (CPRI) rose 4.6% month over month in May, following a 1.2% decrease in April and a 3.4% decrease in March. The US CPRI, which is measured using a three-month moving average, was created to track chemical production in seven regions nationwide.
  • Nearly every large chemical company posted increases in Q1 2021 sales and earnings from a year earlier, according to Chemical and Engineering News. Double-digit sales gains were the norm. Dow, the largest US chemical maker, reported increases of 22% in sales and 133% in earnings for the period. Germany-based BASF, the world’s largest chemical maker, posted a 16% increase in sales for the quarter, while earnings increased 59%. BASF attributed the gains in all three segments to higher prices and volumes, a theme seen across the chemical industry as the economy recovers from the coronavirus pandemic.
  • Wholesale sales of chemicals increased 1.7% month over month on an adjusted basis and 35.1% year over year on an unadjusted basis in May. Year-over-year comparisons for April may be distorted by the large pandemic-related sales decrease in April 2020.
  • Chemical distributor industry employment decreased 1.5% year over year in May.

July 2, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Child care expenses have spiked by more than 40% during the pandemic, soaring from nearly $10,000 annually per child to more than $14,000, according to Center for American Progress data analyzed by online lending marketplace LendingTree. “So much more is being required of these centers during the pandemic, and these new, tougher safety guidelines from governmental agencies have forced them to ramp up their spending in order to comply,” said Matt Schulz, LendingTree’s chief credit analyst. Annual costs at center-based care providers for children ages 3 and 4 have increased 57% during the pandemic. Annual costs at center-based care providers for infants and toddlers (children 2 and younger) are up 37%.

July 2, 2021

  • The Federal Trade Commission (FTC) continues to send letters to companies warning them to stop selling fake treatments for COVID-19. A tenth batch of warning letters was sent in June to almost 400 companies and individuals. Many of the products and treatments that the FTC warned about in the latest batch of letters were similar to earlier ones it challenged, including dietary supplements, ozone therapy, peptide therapy, and IV Vitamin C infusions.
  • COVID-19 cases in the US remain in decline despite fears that the Center for Disease Control and Prevention's (CDC) mid-May mask reversal could potentially lead to a spike. Chiropractic clinics will benefit if costly pandemic-related safety protocols are dropped and clients return as concerns about infection ease. New COVID-19 cases have been down by almost 75% since the middle of April, and the seven-day average declined by early June to less than 20,000 for the first time since March 2020. About 42% of the country's population has been fully vaccinated as of June 7, and 51% has received at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.
  • Many chiropractors say that they’re seeing more patients with back and neck complaints. Industry experts cite the rise of telecommuting as a likely cause of the increase in back and neck complaints, as quickly converted home spaces may not be suitable for work sessions lasting eight hours or longer. Doctor Jaclyn Andrews, a chiropractor with Pittsburgh Chiropractic and Massage Therapy Center, says working from a kitchen table or couch isn’t the best option. “Ideally, you want to have your shoulders rolled down and back and you also want to think about having your neck nice and neutral,” said Andrews.

July 1, 2021

  • Churches and other religious institutions experienced declines in attendance and collections due to closures related to the coronavirus. Smaller congregations are more vulnerable because they are likely to depend on weekly offerings collected in church. Megachurches, defined as having more than 2,000 members, are best positioned to withstand extended closures, largely because of their extensive online operations and online giving programs, according to NPR.
  • The pandemic likely accelerated the rate of US Protestant church closures, according to a report released in May by Lifeway Research. About 3,000 new Protestant churches opened in 2019, but 4,500 closed. The latest data shows a reversing trend compared to five years earlier when 4,000 church openings edged out 3,700 closures. The challenges of opening – or “planting” - an entirely new church were likely made more difficult during the pandemic. In addition to distancing guidelines limiting gatherings, key church planting locations – often school auditoriums, movie theaters, and performing arts centers – were closed. More boomer-age pastors are retiring, and their need for successors may also be affecting the planting of new churches.
  • While vaccines have brought hope for a return to more normal worship services for many congregations, it will likely take time for attendance to recover more completely. In May 2021, 20% of US adults said they attended a worship service in person in the previous week, according to Gallup; 10% said they attended remotely. The May 2021 numbers were up from December when 13% of adults said they attended worship services in person and 16% worshiped remotely. In May 2020 only 3% of adults said they attended in-person in the previous week, and 28% attended remotely. In 2020, annual average church attendance fell to 30%, an all-time low and down from 34% in 2019, according to Gallup. Social distancing prompted many churches and religious organizations to invest in technology to bring worship services, member resources, and tithing online. However, as vaccines continue to roll out, some congregations are considering scaling back their online religious service offerings in order to gently nudge congregants back to the pews, according to The Washington Post.
  • Some health experts and religious leaders are worried ethical concerns may prevent some people from getting vaccinated. The Christian Medical & Dental Associations (CMDA) has said the Pfizer and Moderna vaccines are effective and ethical, and the group encourages their use. Some people are concerned that human fetal tissue may have been used in various phases of vaccine development. Medical ethicists have suggested the public good of preventing the spread of a deadly disease outweighs ethical concerns about the sourcing of cells used in vaccine development.
  • The vast majority of US churches have complied with various restrictions on in-person worship services aimed at preventing the spread of COVID-19, such as requiring face coverings, social distancing, and limiting capacity. However, several churches filed lawsuits claiming restrictions unfairly single out houses of worship. In such cases some rulings favored the church and others ruled on the side of the jurisdiction that issued the regulations. Early in the pandemic, the Supreme Court sided with the states in lawsuits against limits on church attendance in California, Nevada, and Illinois. The Supreme Court later blocked an order in New York state to limit attendance to 10 people in areas with severe community spread. In February, the high court exempted churches from California’s ban on indoor gatherings in counties with high COVID-19 infection risk, but allowed the state to prohibit singing and chanting during services.
  • About 40% of white evangelical Protestants say they likely won’t get vaccinated, according to a March 2021 poll by The Associated Press-NORC Center for Public Affairs Research. That compares to 25% of all Americans who are vaccine resistant, 28% of Protestants overall, and 27% of nonwhite Protestants. Experts note that white evangelicals represent 20% of the US population so half of them refusing vaccines could be a barrier to more widespread immunity. However, faith-based outreach efforts have the potential to reduce vaccination hesitancy among worshipers, according to a recent survey by the Public Religion Research Institute (PRRI) and the Interfaith Youth Core. The survey found that 44% of religious service attendees who were hesitant about vaccines said a faith-based approach could impact their eventual decision to be vaccinated. Approaches mentioned in the survey included a religious leader or community member getting vaccinated, support of vaccines by church leaders, informational forums about vaccines, and vaccination drives.
  • Attendance at US Catholic schools has seen a gradual decline for decades, but the COVID-19 pandemic made the situation worse, according to The Wall Street Journal. Over the past year, more than 200 of the US’s 6,000 Catholic schools closed, according to the National Catholic Educational Association (NCEA). At the start of the 2020/2021 school year, Catholic school enrollment declined 6.4%, the largest single-year drop on record. Catholic schools in urban areas have been hit the hardest as many lower-income families could no longer afford tuition due to job losses and other hardships. Catholic churches were not able to help make up for the tuition shortfall as donations also fell dramatically.

July 1, 2021

  • Many civic and social organizations suspended member access, activities, and programs during the coronavirus outbreak based on recommendations from the CDC and federal, state, and local health officials. Some organizations are offering online alternatives for classes and activities. Other outreach efforts include programs in which volunteers call to check-in on and provide contact for isolated and homebound seniors, emailing information on depression and stress reduction, and providing referrals to calls for help. As the pandemic has caused job losses and other stresses on military families, some VFW posts have raised food donations and are delivering them to military families in need. During the pandemic, one in five military families have become food insecure compared to one in eight in 2019, according to the Military Family Advisory Network.
  • As of June 30, 2021, all but two states were fully reopened, according to The New York Times. On June 30, the 7-day average for daily new cases was about 11,000 – or about half of what they were a month earlier. Amid falling cases and wider vaccine distribution, some civic and social organizations are gradually phasing member access, activities, and programs back in, depending on guidance from state and local governments. On April 19, all Americans over age 16 became eligible to be vaccinated. As of July 1, about 155 million Americans were fully vaccinated or about 47% of the US population.
  • Local YMCAs have provided community support by offering childcare to healthcare workers and first responders, sheltering people experiencing homelessness, and supporting seniors facing social isolation. However, the pandemic significantly impacted the YMCA’s finances. Some regional Y affiliates lost half their members and nearly half their revenue in 2020. The national YMCA organization allowed local Ys to determine if, when, and how to go about reopening according to federal, state, and local guidelines. As COVID-19 cases have fallen and vaccinations have risen, more Ys have resumed services. Many local Ys are offering day, overnight, and online camp experiences for summer 2021. In April 2021, the Centers for Disease Control and Prevention (CDC) issued updated guidelines for summer camps, including keeping children in “pods” of 10 to limit potential exposure, masks, social distancing, and procedures to have in place in the event that a camper or staff member is exposed to COVID-19 or has symptoms.
  • Nonprofit civic and social organizations are finding their budgets squeezed as demand for services remains but staffing and donations have waned. Organizations that received funding from state and local governments may receive less as governments trim their own budgets due to reduced tax revenue. A fresh round of stimulus relief was passed in December. The $900 billion spending bill included more than $284 billion for first and second forgivable Paycheck Protection Program (PPP) loans through the Small Business Administration (SBA), and expanded eligibility for nonprofit organizations. However, the bill did not include aid for state and local governments. Typical nonprofits get four times as much funding from state and local governments as they do from private foundations, according to Nonprofit Quarterly.
  • In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act (ARP). The third round of stimulus includes $360 billion in aid to state and local governments. State and local governments are free to spend the funding on nonprofits that serve the greater good of the community. The ARP also included an additional $7.25 billion for the PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • As COVID-19 vaccinations have ramped up, many nonprofits are stepping up to help, according to The Chronicle of Philanthropy. Organizations that normally respond to disasters provided equipment, and logistics and operational support of mass vaccination and test sites. However, by early July 2021, US supplies of vaccine had outstripped demand as most people who wanted vaccines had received them, according to The Wall Street Journal. Government-run mass vaccination sites and in-store, appointment-based vaccine clinics in pharmacies are being wound down. While volunteering needs for closed or scaled back vaccination sites will fall, demand may shift to more targeted efforts aimed at those who are vaccine hesitant or lacked easy access to vaccine sites. Nonprofits that typically provide outreach to specific groups, including people of color, the LGBTQ community, the elderly, and people experiencing homelessness, are working with state and local governments to determine how to best get vaccines to the people they serve. Some charities are also recruiting volunteers to help non-English speakers connect with vaccination registration resources.
  • As vaccinations have reduced the severity of the pandemic and restrictions are increasingly relaxed, some nonprofits may struggle with how to bring their employees back to the office, according to The Chronicle of Philanthropy. Establishing workplace safety guidelines presents challenges such as whether or not to require masks and/or vaccinations, what percentage of workers should return, and how vaccination status should be determined. Another key concern is how to ensure advancement opportunities remain equitable among employees who prefer to work remotely most of the time versus those who like to be in the office. Some nonprofits’ plans for returning to the office were complicated by the change in CDC guidance that said fully vaccinated people needn’t wear masks indoors or out.
  • Giving to charitable causes rose during the pandemic, helped along by a rising stock market and government stimulus, according to the Annual Giving USA Foundation report released in June. Charitable giving increased 5% in 2020 to $471.4 billion – a new record. Donations were aided by healthy gains on Wall Street – the S&P 500 rose more than 16% by the close of 2020. Stimulus payments sent directly to Americans also helped boost giving as personal incomes went up. Giving by foundations grew the most with a rise of 17% and reached $88.6 billion. Corporate giving declined 6.1% to $16.9 billion as the pandemic put a dent in firms’ profitability. Donations from individuals were up 2.2%. Giving planned in the event of a person’s death, or bequests, grew 10.3%. Charitable organizations focused on civil rights and environmental issues saw the largest jump in giving. Donations also rose for charities involved in religious, education, and human services causes. Health-related charities experienced a 3% dip in donations as the pandemic sidelined walks and fun runs that are major sources of fundraising. Arts giving declined 7.5%.

July 11, 2021

  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Residential construction, a driver of demand for clay construction products, may decline in the upcoming months as a result. “Single-family permits declined to the lowest pace since September 2020 as the home building market cools somewhat to adjust to higher prices and longer delivery times of building materials,” said NAHB Chief Economist Robert Dietz. “The count of single-family homes permitted but not started construction is up 53% over the last year due to both gains for home construction since the onset of the 2020 virus crisis and the delay of some building projects due to higher costs for materials and labor.”
  • Pandemic-driven development of anti-microbial materials for high-touch surfaces like tile and countertops may slow now that the Centers for Disease Control and Prevention (CDC) has acknowledged that the risk of catching the coronavirus from surfaces is low. Researchers reported early during the pandemic that the virus could survive for days on plastic or stainless steel, and the CDC advised that if someone touched one of these contaminated surfaces and then touched their eyes, nose or mouth, they could become infected. Health experts say that revised CDC guidance reflects evolving data on transmission throughout the pandemic.
  • Many analysts say that manufacturers of clay-based housewares should prepare for an upcoming pandemic-related spending shift that is increasingly referred to as revenge shopping. Consumers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues. Spending on clay-based housewares may decline as a result.
  • Manufacturing giant Corning announced a “new breakthrough in glass-ceramic technology” that can kill pathogens within two hours. The Corning Guardiant technology adds copper to glass-ceramic technology to create a material that shows a “highly durable antimicrobial activity against SARS-CoV-2,” the virus that causes COVID-19, company officials say. The product was tested in a paint coating that was still effective against the virus even after Corning simulated six years of scrubbing.
  • SINTEX Technologies, an original equipment manufacturer (OEM) of ceramic products for medical and nonmedical applications, has developed a silicon nitride compound with antiviral properties that it is marketing to reduce the spread of COVID-19 on surfaces and in PPE. The compound inactivates the COVID-19 virus within a minute of exposure. The silicon nitride can be applied to high-touch surfaces such as counters, door knobs, medical equipment, screens, and face masks and can be mixed into paints and coatings. The compound also works to inactivate other viruses including Influenza A and Enterovirus.
  • Employment in the clay product and refractory manufacturing industry decreased 0.5% year over year in May.
  • The coronavirus has not slowed clay and refractory manufacturers’ increases in product prices. The price of clay construction products was up 3% year over year in May. Likewise, clay refractory prices increased 1.7%.

June 22, 2021

  • The National Retail Federation (NRF) revised its 2021 total retail sales forecast to $4.44 trillion, up from $4.33 trillion. Sales will grow between 10.5% and 13.5% year over year, the NRF says. The organization expects online shopping to stay above pre-pandemic levels, but to moderate from 2020 levels.
  • The return to in-store shopping as COVID-19 vaccination rates increase and new case number decrease offers some relief to retailers in part because fewer shoppers ask for their money back after making a purchase at the store — 8% compared with 25% for online, according to Forrester Research. In-store customers also tend to do more impulse buying. About 25% of in-store clothing purchases are done on a whim versus 16% online, according to market research firm NPD Group.
  • Teen spending is slowly increasing from a two-decade low, with teenage girls leading the spending recovery, according to Piper Sandler's 41st biannual “Taking Stock with Teens” report. Online fashion brands like Shein and Princess Polly are surging in popularity, along with thrift marketplaces like Depop. The “wallet share” that upper-income female teens devote to apparel hit 29% in April, a high not seen since 2013. That percentage had stagnated at 25%, from the spring of 2017 to the spring of 2019, Piper Sandler said.
  • Many analysts expect a wave of discretionary expenditures on items like clothing when the pandemic wanes. Bloomberg Economics estimates that consumers have amassed about $1.7 trillion in savings since the beginning of the pandemic through January. That’s being bolstered by a new round of stimulus payments. Consumer spending during Q2 and Q3 2021 is likely to be the strongest such period in at least 70 years, according to economists at financial services firm Wells Fargo.
  • Retail sales for clothing stores increased 2.9% in value month over month on an adjusted basis in May and 81.3% in value year over year on an unadjusted basis during the first five months of 2021. Year over year comparisons may be distorted by the large drop in sales, particularly during the early months of the coronavirus pandemic.
  • Telecommuting has helped make the athleisure industry one of the most lucrative sectors of the fashion world as companies such as Lululemon, Alo Yoga, and Athleta have risen in popularity. The market for athleisure clothing is expected to grow at a compound annual rate of 6.7% through 2026 and reach a value of $257.1 billion.
  • Clothing store chain American Eagle announced plans to shut between 200 and 250 of its approximately 880 stores in the next two to three years. The closures will mostly be mall-based locations. The company also plans to increase the number of Aerie stores by 50, to about 400, at the end of 2021, and plans to have 500 to 600 Aerie locations in 2023.
  • Gap Inc., the owner of the Gap, Banana Republic, and Old Navy chains, plans to have closed 30% of its Gap and Banana Republic stores in North America by the beginning of 2024. “We’ve been overly reliant on low-productivity, high-rent stores,” said Mark Breitbard, global head of the Gap brand. About 80% of revenue from Gap and Banana Republic is expected to come from e-commerce and non-mall locations like outlet stores and strip mall spaces. Industry experts say that the closures may be due in part to avoidance by shoppers of enclosed malls due to coronavirus concerns.
  • Employment in the clothing store industry increased 132% from the pandemic-related low of April 2020 but was down 23.5% from the pre-pandemic month of April 2019.

July 13, 2021

  • American coal production will increase 15% year over year in 2021 to meet stronger demand for electricity in the US and abroad, according to the US Energy Department’s July outlook. That would be the largest increase since at least 1990 and nearly double the 8% increase projected in May, when the economic rebound was still in its earlier stages.
  • Appalachian coal mining's share of natural methane gas emissions was unchanged during the coronavirus pandemic even as methane emissions from the production of natural gas through hydraulic fracturing decreased, according to European satellite data analyzed by Kayrros, a company focused on climate risk. Mining releases the gas from coal and the rock that surrounds it. Methane is estimated to have 84 times the warming potential of carbon dioxide in the near term. The United Nations in early May called for a 45% reduction in methane emissions by 2030.
  • Coal production by the top 25 coal mines in the Northern Appalachian basin increased 16.8% quarter over quarter and 17.4% year over year during Q1, 2021, according to S&P Global Market Intelligence. Production increased as pressure from COVID-19 lockdowns eased. Coal producer Arch Resources noted "rapidly diminishing operational and economic impacts of the pandemic" in its first-quarter earnings release.
  • The Energy Information Administration projects coal miner productivity to decrease to an average of 6.32 short tons (st)/hour in 2021 from an estimated 6.37st/hour in 2020 even though the agency expects production to increase by 12% from a 55-year low in 2020.
  • The share of energy generated from coal has dropped more sharply during the coronavirus pandemic than that of any other power source, according to a report from the Potsdam Institute for Climate Impact Research. Ottmar Edenhofer, director and chief economist at the Potsdam Institute and an author of the report, said that the findings were not expected because natural gas has traditionally had the highest operating costs of all power sources, so gas-fired plants are usually the first to be taken offline when demand for power falls. The sharp decline in gas prices during the pandemic may have made coal power more expensive than gas power, however. The trend away from coal could outlast the pandemic, according to the report. While power plants that use renewable energy, like wind or solar, are expensive to build, it is not necessary to purchase fuels to run them.
  • Employment in the coal mining industry increased 5.8% year over year in June but was down 17.5% from the pre-pandemic month of June 2019.
  • Global coal power capacity fell for the first time on record in 2020, according to US research group Global Energy Monitor (GEM). The closure of generators outstripped stations being commissioned, causing coal power capacity to decline by 2.9 gigawatt in the first half of 2020. Slowed commissioning due to the economic shock of the coronavirus pandemic, as well as stronger pollution regulations in Europe, caused the global decline, said Christine Shearer, GEM's coal program director. India has also shrunk its coal-fired capacity in 2020, but China increased its coal generating capacity. China built 86% of new coal generation capacity during the period. Some industry experts say that, while the decline represents less than 1% of generation capacity, it will be a "pivot point" for global electricity supply and mark the long-term decline of coal-fired generation.
  • Energy consumption from renewable sources (solar, wind, hydro) has overtaken coal for the first time since 1880, when wood was used to generate slightly more energy than coal, according to the US Energy Information Administration. The coal mining industry was already suffering before COVID-19 as more power plants were converting from coal to natural gas as a feedstock.
  • Natural gas prices fell as low as $1.43 in June 2020 but had risen to $3.70 on July 12. Industry observers suggest that natural gas prices must be at least $3 per million Btu before power producers will consider switching back to coal.

July 11, 2021

  • Coffee exports from Brazil, the world’s biggest supplier have declined since May because of ongoing logistical bottlenecks, according to Marcos Matos, general director at Brazil coffee exporter group CeCafe. Increasing competition for space on container vessels that ship goods around the world has sent freight rates soaring, said Matos, who estimates that shipping coffee from Brazil to New Orleans now costs about $4,000 per container, up from a range of $1,500 to $2,000 before the pandemic.
  • A pandemic-driven shipping container shortage in Southeast Asia has made it take longer and cost more to import coffee from that area. The shortage has caused freight rates to rise, which has driven up coffee prices as higher freight rates are passed on, according to José Sette, executive director of the International Coffee Organization (ICO). “It is now more expensive than in the last five to 10 years to bring coffee to the consumer,” Sette said.
  • Many analysts say that coffee and tea manufacturers should prepare for an upcoming pandemic-related spending shift that some are calling revenge shopping. Shoppers will sweep “through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns.” Businesses with “communal value,” namely eateries and entertainment venues, will benefit the most, the consulting firm says. A significant portion of coffee sales may shift from grocery stores back to coffee shops as a result.
  • Consumer-product manufacturers are expanding factories and revamping production lines in the belief that work-from-home habits will outlast the coronavirus pandemic. J.M. Smucker Co., for example, has restarted idle machines and retrofitted others to make sizes and varieties of Folgers and Dunkin’ coffee that it expects to be popular with people working from home. The pandemic has lasted so long that people have formed new habits and bought equipment to help them work from home for years, said Bob Nolan, Conagra’s head of consumer insights and data. “This gives us confidence that this isn’t just a flash in the pan," he said.
  • Coffee shops are busiest at 10 am on Saturdays, according to Google. The Internet advertising and search giant made the discovery while studying its Maps and Trends services and comparing searches during the coronavirus pandemic to the same time period a year earlier.
  • World coffee production for 2020/21 is forecast to increase 5.4% year over year to a record 176.1 million. Brazil is forecast to account for most of the gain as its Arabica crop enters the on-year of the biennial production cycle and Robusta reaches record output. World exports are forecast higher, largely on the strength of Brazil. Global ending stocks are expected to jump to a 6-year high as production outpaces consumption.

June 24, 2021

  • Legislation that would add another $60 billion in a second round of relief to Restaurant Revitalization Fund (RRF) has been introduced in the US Congress. The Restaurant Revitalization Fund Replenishment Act of 2021 amends the American Rescue Plan Act of 2021 to increase appropriations to the original Restaurant Revitalization Fund, and for other purposes. Funds distributed to restaurants in the RRF’s first round were prioritized for women, veterans, and economically and socially disadvantaged groups, during its first 21 days. This was later challenged in court, as this policy depleted most of the funds. The $60 billion replenishment round more than doubles the original’s allocation.
  • Many coffee shops still ban reusable items like travel mugs. Clean Water Action, which leads a technical-assistance program called ReThink Disposable to help restaurants reduce waste by stemming the use of disposable food-service items, says that there is no evidence that reusable cup will transmit COVID. “Early on in the pandemic the [Centers for Disease Control and Prevention] gave some alarming guidance because they weren’t sure,” said Johnathan Berard, state director of Clean Water Action in Rhode Island, “but by June the CDC had reversed its position saying there was no evidence COVID-19 is spread by surface contact."
  • The number of Americans drinking coffee at outlets away from home fell almost 20% during the pandemic, but Americans still consume the same amount of coffee, according to according to the National Coffee Association.
  • Telecommuting, which is widely considered to have shifted demand for coffee from shops to the home, is likely to continue post-pandemic. A March report from the employment website Indeed says postings for jobs that mention “remote work” have more than doubled since the pandemic began. Such job postings are increasing even while vaccinations are accelerating. Automaker Ford recently told about 30,000 of its employees worldwide who have worked from home that they can continue to do so indefinitely, with flexible hours approved by their managers.
  • Drive thru is becoming an increasingly attractive strategy to mitigate the impact of Covid-19. About 63% of consumers surveyed by World Coffee Portal in 2020 favored the drive-thru over entering a coffee shop, up from 48% in 2019. Dunkin’ is by far the largest drive-thru operator in the US with 6,391 sites, ahead of Starbucks’ 3,900 locations and Panera Bread’s 840. About 37% of all US branded café outlets offer a drive-thru option.
  • Coffee shop sales will only return to pre-pandemic levels in 2023, according to research and consultancy firm Allegra World Coffee Portal. The firm estimates that sales fell 24% year over year to $36 billion in 2020 and will only grow to $40 billion this year, below 2019 levels.
  • COVID-19 hurt breakfast sales in restaurants more than lunch or dinner sales, and the recovery of the breakfast business has been slow due to the drastic reduction of commuter traffic. Executives at Dunkin’ Brands Group stated that they had seen a drop in business in the crucial 6 a.m. to 9 a.m. time frame, even as things had picked up between 10 a.m. and 2 p.m.

June 25, 2021

  • Laundromats are adapting business protocols in response to the coronavirus. According to a survey by American Coin-op, laundries are cleaning and sanitizing more often (94%), limiting the number of people on premises (62%), posting coronavirus-related signage (77%), emphasizing WDF (wash/dry/fold) and pickup/delivery services (32%) and increasing advertising and social media efforts (34%). Some establishments are only taking drop-off laundry, asking customers to fold clothes at home, and suggesting mid-week visits that allow for better social distancing, according to CBS News.
  • In the most recent American Laundry News Your Views survey released in May 2021, 85% of laundry owners said they had difficulties hiring new employees during the pandemic. More than 80% of laundry owners said the availability of government assistance programs had kept potential workers from applying for available positions, rather than other issues such as fear of contracting COVID-19, stay-at-home orders, or caring for family members. About 70% of survey respondents said they’ve had trouble retaining employees during the pandemic. Absenteeism due to symptoms, potential virus exposure, and/or the need to care for family members has been a major issue for laundry owners. To counter the effects of missed work, 90% of laundry owners report having cross-trained their workers.
  • The COVID-19 outbreak slowed the circulation of coins in the US economy which created problems for several coin-dependent business, including coin-operated laundries. During the quarantine, not only did retail activity drop but consumers stopped cashing in their coins for paper notes. The US Mint also slowed coin production in the early days of the pandemic to protect workers. Consumers’ shifting to contactless payment options also reduced coin circulation. In June 2020, the Federal Reserve put allocation limits on the amount of coinage depository institutions could order, according to Coin World. Over the next several months the coin shortage improved as the US Mint increased coin production and the Federal Reserve lifted allocation limits. However, coin orders from depository institutions increased significantly in March and April of 2021, outpacing US Mint production and resupply from bank deposits. In early May the Federal Reserve reinstated allocations restricting depository institutions’ orders of quarters and dimes. The Fed has said there isn’t a shortage of coins, but rather much of the coin supply is “sitting dormant” in consumers’ homes and is not being circulated. Until more consumers cash in their coins, cash-dependent businesses may continue to have trouble obtaining enough coins.
  • Some industry insiders suggest coin-op laundry firms consider adjusting their service offerings to meet the evolving needs of customers. Touchless payment systems are expected to be very important, and some firms may add pick-up and delivery options as more consumers work from home and run fewer errands. Adding sanitizing features to existing laundry equipment can help draw in customers, differentiate from competitors, and generate additional revenue, according to American Coin-op. Sanitizing features include the injection of ozone gas to cold water intakes, which kills bacteria and viruses. Other disinfectants can also be added at various stages of the washing cycle. Sanitizing options often can be offered as add-ons to existing machine menus.
  • Laundries are adapting to help promote social distancing. Coin-operated laundries that are open 24-hours may offer better opportunity for social distancing. Laundromats that are larger may also have advantages in providing distance between customers. Some laundries have installed TVs or repurposed existing ones to display distancing information, such as suggesting customers wait in their vehicles between laundry phases. Concern over shared laundry facilities in apartment buildings and condos may drive demand for drop-off services as well as home pick-up and delivery.
  • Coin-operated laundries that saw business drop off during the pandemic may have sought relief via the reauthorization of the Paycheck Protection Program (PPP). The PPP was revived with the December passage of the $900 billion COVID-19 Economic Stimulus Relief Act. The legislation included $300 billion in funding for Small Business Administration (SBA) loans. The December round of PPP let eligible borrowers get a second draw loan. It also simplified loan forgiveness for loans under $150,000 and makes forgiven loans tax deductible. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act which included an additional $7.25 billion for PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • Despite their nondiscretionary nature, coin-operated laundries were affected by the lockdowns and social distancing requirements, according to an April 2021 report by S&P Global. Suburban flight early in the pandemic led to higher-than-normal multi-family housing vacancies which negatively affected some laundry companies’ revenue and earnings. S&P Global estimates organic revenue for firms in the hygiene and facility management services segment declined 5% in 2020 compared to 2019. However, the sector’s organic revenue is expected to bounce back in 2020 by 5% to 10%.

June 30, 2021

  • The Consumer Financial Protection Bureau (CFPB) encourages credit reporting agencies and furnishers to continue credit reporting but also provide leeway for consumers and companies experiencing hardships. CFPB is relaxing enforcement of dispute investigation timelines on a case-by-case basis to help collection agencies hit by staffing losses due to coronavirus. Collection agencies can also forego investigating disputes by credit repair organizations that are determined to be “frivolous or irrelevant.” The CARES Act outlines obligations for collections agencies to report as current any credit obligations in which payment accommodations were made.
  • The District of Columbia passed legislation in early April 2020 banning collection agencies from outbound calling, writing or messaging consumers to collect debts until 60 days after the coronavirus emergency ends. Agencies can still reply to customer-initiated communications. The law also prohibits collectors from initiating legal proceedings, repossessions, or visiting consumers’ homes. As of June 14, four states and the District of Columbia had in place regulation of collections during the pandemic beyond collections related to stimulus payment garnishments. The $900 billion stimulus bill passed in December included $600 stimulus checks per person, including children. Under the stimulus law passed in December, private creditors and debt collectors are not permitted to garnish stimulus payments. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act. The plan includes $1,400 stimulus checks for most individuals and their dependents, and a $300 supplemental unemployment benefit that extends through September 6, 2021. Stimulus payments under the American Rescue Plan are subject to collections because the bill passed using the reconciliation process which prohibits provisions that do not impact the federal budget. The legislatures, judiciaries, or governors in several states have established various regulations of collections related to stimulus payments and federal child tax credits under the American Rescue Plan
  • US household debt rose 0.6% in the first quarter 2021, according to the Federal Reserve Bank of New York. Household debt rose by $85 billion to $14.64 trillion as consumers took on mortgages to buy and refinance homes. Mortgage balances rose by $117 billion. Balances for student loans and auto loans rose $29 billion and $8 billion, respectively. Credit card balances fell by $49 billion, marking the second-largest quarterly decline on record (dating back to 1999). In Q1 2021, credit card balances were $157 billion lower than they were at the end of 2019, which is indicative of cardholders paying down balances and ongoing weakness in consumer spending. Consumers continue to benefit from government aid and forbearance programs for mortgages, student loans, and auto loans. As some consumers have fewer financial resources, mortgages, rent, and car payments are a priority so other bills may not get paid, leading to collections actions.
  • Collection agencies handle personal information and require data security. Allowing employees to work from home raises security issues. For instance, digital assistants, like Alexa and Google on your smartphone, can “hear” conversations that employees have with debtors regarding finances and personal information.
  • Healthcare providers are turning to collection agencies to recover cash for them. Recovering past due bills is growing in importance for healthcare providers.
  • Debt collection scams are on the rise in 2021. The FCC has launched the COVID-19 Consumer Warnings and Safety Tips website that aims to inform consumers about the rise in coronavirus-related phone and text scams.
  • Early in the pandemic, many consumers took financial hardship offers from lenders who allowed paused payments on auto loans. Some lenders worried an extended period of widespread financial hardship could lead to loan defaults. However, most consumers who took advantage of lenders’ financial hardship offers are either keeping up with their payments or have exited such programs. In May 2020, slightly more than 7% of auto loans were in financial hardship status, according to TransUnion. By May 2021, the percentage of auto loans in financial hardship dropped to just over 2%. Consumers resuming their loan and other debt payments may signal improved financial stability which could reduce demand for collections.
  • Billions in federal rent aid has had trouble reaching those who need it, according to The Wall Street Journal. The rent aid program is administered by the US Treasury Department but processing aid applications and dispersing the funds has fallen on local governments, many of which have been overwhelmed by the volume of demand. In May, Treasury recommended changes to expedite payments, including loosening some documentation requirements, and allowing funds to be paid directly to renters instead of landlords. However, manually vetting and approving the applications is time-consuming, and some local officials worry looser application requirements could increase the risk of fraud. According to US government figures, about 11 million tenants are at risk of eviction. Rent aid applicants who experience delays may also have other debts that fall into collection.

July 3, 2021

  • Florida Governor Ron DeSantis signed legislation shielding the state's colleges and universities from lawsuits seeking refunds for students because of pandemic-related closures. Campuses closed in March 2020 in an effort to prevent the spread of COVID-19, with students forced to learn online.
  • Between three and four times as many students as usual took a gap year during the 2020-2021 school year, according to the Gap Year Association. The number of students doing a traditional gap year with an organized program is trending back to ordinary levels for the 2021-2022 school year. The number of students doing independent gap years remains higher than normal.
  • More than 100 US colleges and universities are now requiring students to get Covid-19 vaccinations before they return to campus for the fall semester, according to CNN. Some schools have said they will make exemptions for medical, religious or personal reasons.
  • About 36% of adults under the age of 35 don't plan on getting vaccinated, according to a recent Quinnipiac University poll.
  • Plaintiffs in two class-action lawsuits filed against the University of Oregon claim that they should not have been required to pay on-campus fees if they haven't been on campus. Steve Berman, an attorney for the students in both cases, said his clients did not get the full value of what they paid for when campuses closed and switched to online sessions. The lawsuits claim that the schools have refused to refund or reimburse students for tuition and other fees they paid for "a comprehensive on-campus academic experience."
  • The American Rescue Plan coronavirus stimulus package signed into law in March by President Biden includes nearly $40 billion in new relief for students and colleges. Colleges and universities will be required to spend half of the relief money that they receive on emergency grants to students.

June 22, 2021

  • Businesses that are still reeling from the economic impact of the coronavirus pandemic will have to look for other sources of funding now that the Paycheck Protection Program (PPP) has closed. Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • The Centers for Disease Control and Prevention has issued guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings. Bakeries are likely to benefit if consumers return to stores and workplaces due to the relaxed restrictions. Experts note, however, that interpretation of the guidance is likely to vary by state.
  • Retail sales in the grocery store industry increased 1.2% in value month over month on an adjusted basis in May but decreased 0.8% in value year over year on an unadjusted basis.
  • Krispy Kreme Doughnuts customers who show a valid COVID-19 vaccination card at any Krispy Kreme shop in the US can receive a free original glazed donut, every day through the end of the year. The chain also is also delivering free donuts to select vaccination centers throughout the country for a limited time.
  • Adoption of robotic technology is increasing at bakeries due in part to pandemic-induced social distancing and safety measures. Robots were first used in bakeries 20 years ago, according to Baking Business, but advances in size, mobility, adaptability, vision, controls and end-of-arm tooling are so significant that robots installed just five years ago are being replaced today. Emerging in importance are collaborative robots well-suited to address labor shortages and repetitive motion tasks at medium to smaller wholesale bakeries. Quality control methods, approaching that of artificial intelligence and machine learning, are being incorporated into large and small robots alike.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.
  • Employment at commercial bakeries increased 17% from the pandemic-related low of April 2020 but was down 0.7% from the pre-pandemic month of April 2019. Employment at retail bakeries increased 3.7% from the pandemic-related low of April 2020 but was down 2.8% from the pre-pandemic month of April 2019.

July 13, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Many banks say that they will need to continue increasing provisions for loan losses into 2021, according to a survey released in mid-November by IntraFi Network. Most banks have allowed borrowers to skip payments if their finances had been hit hard by lockdowns and other restrictions meant to slow the spread of the virus, but many of those grace periods have expired. Two-thirds of respondents said that they expect loans will need to be restructured for borrowers who are unable to make payments when their deferral periods end.
  • Employment in the commercial banking industry decreased 3.6% year over year in June.

July 9, 2021

  • Fitch Ratings’ commercial mortgage-backed securities (CMBS) delinquency rate decreased 15 basis points to 3.81% in June from 3.96% in May due to a steadily declining pace of new delinquencies, continued strong resolutions, and new issuance. CMBS are fixed-income investment products that are backed by mortgages on commercial properties rather than residential real estate. The delinquency rate is the percentage of commercial real estate loans that were 30 or more days past due or in foreclosure. A rising delinquency rate indicates that an increasing number of commercial property owners cannot pay the mortgages on those properties. The rate is tracking Fitch’s expectation to end 2021 below 4.0%, albeit with some continued volatility.
  • Fitch expects continued volatility in the CMBS delinquency rate through the remainder of 2021, as stimulus burns off and debt relief expires, but also as loans get modified or brought current with some property cash flows recovering from the severe stress of 2020. Many properties continue to struggle even as businesses re-open. Any significant reduction in the overall rate will not occur before 2022.
  • A larger share of distressed companies upended by the COVID-19 pandemic is using court processes to restructure instead of close, according to S&P Global Market Intelligence. Property managers are likely to benefit if closings decrease. Nearly 62% of corporate bankruptcy filings in 2020 sought reorganizations, the highest rate for any year going back to at least 2010. Companies were less likely to liquidate in 2020, a departure from 2019 and 2018 when corporate liquidations outpaced reorganizations in bankruptcy filings. As of March 30, the share of filings seeking restructuring is larger in 2021 than in 2020. S&P analysts note that government stimulus and easy access to capital have kept at-risk companies from entering bankruptcy following a jump in filings during the early months of the pandemic in in 2020, but bankruptcies are likely to pick up again later in 2021 as companies confront the aftershocks of the pandemic.
  • The gradual disappearance of department and chain stores across the retail landscape, which has accelerated because of COVID-19, has put the existence of malls in jeopardy. Bankruptcies have plagued traditional anchor stores, like Sears and JC Penny, and Green Street forecasted that more than half of all mall-based department stores would close by the end of 2021. Smaller retailers often have co-tenancy clauses that allow them to pay reduced rent or even break the lease if two or more anchor stores leave a location. Apparel stores, a sector that has been especially hard hit by the pandemic. account for about 60% of occupied mall space, according to the New York Times.
  • Some firms are seizing on the coronavirus pandemic’s economic disruption to negotiate shorter leases at cheaper rents, according to The Commercial Observer industry news site. Companies that are not opting for traditional 10-year leases in Manhattan, for example, tend to be small and less tied to a specific office footprint, brokers say. Recent data suggest less interest in 10-year commitments even among larger companies. The average length of leasing deals of at least 100,000 square feet completed in 2020 through September in Midtown Manhattan, for instance, was 8.7 years, according to research from Colliers International. It was 12.5 and 12.7 years in 2018 and 2019, respectively, taking the years as a whole.
  • Employment in the real estate industry increased 4.4% year over year in June but was up just 1.5% from the pre-pandemic month of June 2019. Employment of real estate agents and brokers increased 7.2% year over year in May but was up just 2.4% from May 2019. Employment in the property management industry increased 5.8% year over year in May and was up 4.5% from May 2019.

July 7, 2021

  • Total commercial construction spending decreased 0.6% month over month on an adjusted basis and 3% year over year on an unadjusted basis in May.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • The US Small Business Administration (SBA) stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million Paycheck Protection Program (PPP) loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Excess office space resulting from the pandemic-driven rise in telecommuting may be converted into housing space. Likely candidates for conversion include aging, deteriorating or functionally and technologically obsolete office buildings; buildings in overbuilt areas or neighborhoods with falling real estate values and rising vacancy rates; and buildings far from public transit. Some buildings could be adapted for mixed-use, with one portion of a building preserved for offices and residential units occupying the remaining portion. Commercial construction firms experiencing low demand for new office space may benefit from the opportunity to convert these buildings.
  • The Dodge Momentum Index moved 9.1% higher in May to 178 (2000=100). The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. May’s jump was the result of a large increase in commercial planning activity, which posted its strongest month-over-month increase since October 2017. Institutional planning, meanwhile, fell by less than one percentage point. Commercial planning had been in a holding pattern over the last four months, but broke out in May due to several sizable data center, office, and warehouse projects that peaked in a 13-year high for the commercial component of the Momentum Index. While essentially flat in May, institutional planning remains at levels not seen since 2009. On a year-over-year basis, both commercial and institutional planning were up from May 2020 (38% and 47% respectively). The Momentum Index overall was also 41% higher than in May 2020.
  • Spending on nonresidential building projects is declining and will do so through 2021, according to a mid-year update to the American Institute of Architects’ (AIA) Consensus Construction Forecast. The AIA estimates an 8% spending drop in 2020 and just under 5% in 2021 due to pandemic-induced economic disruptions. This is the first time in nearly a decade that nonresidential construction spending has trended downwards, according to the AIA.
  • Employment in the commercial building industry increased 2.8% year over year in May.

July 12, 2021

  • Commercial bankruptcy filings increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021. The number of bankruptcies per month has been volatile in 2021. Just 27 new corporate bankruptcy cases were filed in May. Some experts continue to question whether government support and easy access to capital will keep distressed companies out of court or if another bankruptcy spike will soon come, according to S&P Global Market Intelligence. "You can't kick the can down the road forever," said Robert Hirsh, a partner in Lowenstein Sandler LLP's bankruptcy and restructuring department.
  • The national office vacancy rate, an indicator of demand for some types of commercial equipment, increased to 18.2% in Q1 from 17.7% in Q4 2020, according to Moody’s Analytics. Office vacancies had been trending around 15% to 16% nationally before the pandemic. Retail vacancy increased to 10.6% in Q1 from 10.5% in Q4 2020.
  • Rental equipment industry revenue will increase about 1.5% year over year in 2021, according to the American Rental Association. Revenue decreased 11.7% year over year in 2020. “With the government stimulus programs and the rollout of the vaccine, people are beginning to have more confidence. The equipment and event rental industry often recovers from adversity more quickly than the industries it serves, and it looks like this is happening again,” said John McClelland, Ph.D., ARA vice president for government affairs and chief economist.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Industry employment decreased 2.6% year over year in May.

July 12, 2021

  • Commercial bankruptcy filings increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021. The number of bankruptcies per month has been volatile in 2021. Just 27 new corporate bankruptcy cases were filed in May. Some experts continue to question whether government support and easy access to capital will keep distressed companies out of court or if another bankruptcy spike will soon come, according to S&P Global Market Intelligence. "You can't kick the can down the road forever," said Robert Hirsh, a partner in Lowenstein Sandler LLP's bankruptcy and restructuring department.
  • About 90,000 restaurants have closed permanently or long-term since the beginning of the coronavirus pandemic, according to the National Restaurant Association (NRA). That’s less than 14% of the country’s restaurants and is lower than the 110,000 figure reported by the association in December 2020, when the executive vice president for public affairs, Sean Kennedy, described the industry’s status as “an economic free fall.” An NRA survey conducted from April 1 to April 14 found that 44% of operators expected their average sales from April to June to be higher than in March 2021.
  • The national office vacancy rate, an indicator of demand for some types of commercial equipment, increased to 18.2% in Q1 from 17.7% in Q4 2020, according to Moody’s Analytics. Office vacancies had been trending around 15% to 16% nationally before the pandemic. Retail vacancy increased to 10.6% in Q1 from 10.5% in Q4 2020.
  • Rental equipment industry revenue will increase about 1.5% year over year in 2021, according to the American Rental Association. Revenue decreased 11.7% year over year in 2020. “With the government stimulus programs and the rollout of the vaccine, people are beginning to have more confidence. The equipment and event rental industry often recovers from adversity more quickly than the industries it serves, and it looks like this is happening again,” said John McClelland, Ph.D., ARA vice president for government affairs and chief economist.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Industry employment increased 4% year over year in May.
  • Wholesale sales of professional and commercial equipment and supplies were unchanged month over month on an adjusted basis but were up 31.2% year over year on an unadjusted basis in May. Year-over-year comparisons may be distorted by the large pandemic-related sales decrease in 2020.

July 13, 2021

  • The Centers for Disease Control and Prevention and the Coast Guard have updated guidance for commercial fishermen, saying those who are fully vaccinated do not need to wear a mask while outside on a commercial fishing vessel. Prior guidance required mask use until September 13.
  • The Centers for Disease Control and Prevention said in April that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Fishing boat operators are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • The $1.9 trillion American Rescue Plan passed in March contains significantly less relief for the commercial fishing and seafood industries than the early 2020 CARES Act, according to the National Fisherman news site. The seafood industry was included in American Rescue Plan language under the agriculture section, which comes with a $4 billion set-aside to assist domestic food production and the supply chain in coping with ongoing COVID response and preparedness. The set-aside allocates $1.5 billion for food and commodity purchases, and grants or loans to seafood processors to cover expenses tied to pandemic protocols. It also has $4 billion in relief funds for the US Department of Agriculture to purchase and distribute commodities including seafood.
  • Commercial fishing firms are likely to benefit both directly and indirectly from rising COVID-19 vaccination rates. Seafood processing plants in Alaska, the top seafood processing state in the US, had emerged as COVID-19 hotspots, according to Bloomberg Government. Joe McLaughlin, the state epidemiologist, said that the outbreaks at seafood processing plants are “reminiscent of the meat packing plant outbreaks in the Lower 48.” About 48% of the country's population has been fully vaccinated as of July 12, and 55% has received at least one dose of a COVID-19 vaccine, according to the US Centers for Disease Control and Prevention.
  • Commercial fishing operations are waiting longer to get their boats repaired. Shipyards are staggering crews to meet distancing requirements, while making repairs. Longer wait times at port limit fishing opportunities and could affect a boats ability to fill its quotas and customer orders.

July 3, 2021

  • Commercial bankruptcy filings, an indicator of demand for commercial printing services, increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021.
  • The US Small Business Administration (SBA) stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million Paycheck Protection Program (PPP) loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Spending on print advertising will stabilize in 2021 after dropping in 2020, according to advertising consulting firm WARC. It will take at least two years for total advertising spending to recover, however.
  • Commercial printing industry employment increased 1.6% year over year in May but was down 13% from the pre-pandemic level of May 2019, according to the US Bureau of Labor Statistics.

June 30, 2021

  • Food banks are offering more mobile, delivery, and drive-thru options to assist vulnerable populations and observe social distancing guidelines. Food banks experienced long lines of cars as people stayed in their vehicles to social distance and workers brought food to them. Food banks are asking for monetary donations so they can purchase food from food distributors and commercial suppliers.
  • Key concerns include increased demand due to job loss, reduced availability of food service employees and volunteers due to illness, and insufficient food collection and storage capability. Food banks were overwhelmed as demand for food in many cases more than doubled. Prior to the pandemic, more than 35 million people in the US were food insecure, including more than 10 million children. Due to COVID-19, Feeding America estimates the number of food insecure Americans may have risen to 45 million in 2020, including 15 million children. Between April to December 2020, US food banks distributed about 50% more food than they did during the same period in 2019, according to Feeding America.
  • An improving economy and government stimulus programs may reduce demand for community food services. The US economy added 559,000 jobs in May 2021, according to the Bureau of Labor Statistics and the unemployment rate fell slightly to 5.8% compared to April. New jobless claims were 411,000 the week ending June 19. However, in May 2021 there were still more than 5.5 million fewer employed people than there were in February 2020. A second round of stimulus relief was passed in December. The $900 billion spending bill included $600 stimulus checks per person, including children and extended supplemental unemployment benefits. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act. In addition to the one-time payments of $1,400 per individual, and another $1,400 for each dependent, many Americans may also receive an existing tax credit that will give most families with children a monthly payment of $300 per child. Payments are to start in July. The benefit is set to expire at the end of the year, but the Democrats aim to make it permanent. The bill also extends the $300 supplemental unemployment benefit through September 6, 2021 and opened jobless benefits to millions more Americans. Food aid organizations, including Feeding America, are concerned about a possible “food cliff” in the coming year as many of the food aid and stimulus programs expire.
  • Congress allocated $850 million in food aid through two stimulus measures passed in March 2020. Stimulus efforts also included $3 billion for the Farmers to Families Food Box Program. The program – which was extended as part of the Consolidated Appropriations Act passed in December 2020 – aimed to help struggling farmers by paying them to provide produce, meats, and dairy products to the hungry. Citing inefficiencies and high costs, the USDA wound down the Farmers to Families Food Box program at the end of May 2021. It is being replaced by a new USDA food box program that will provide fresh produce through The Emergency Food Assistance Program (TEFAP) and be distributed to those in need by local foodbanks.
  • Individual communities are using mapping software to help people locate food banks and provide information about hours of operation and how the food distribution process works. Such tools are helping community food aid organizations connect with people who have never used food banks before. By leveraging US Census and other data, mapping technology is also being used to pinpoint areas in a community with the greatest need for food aid. Mapping data can also help with identifying trends across distribution locations which can help solve complex logistics challenges like the best storage spots for various types of foods and demand cycles for different food items.
  • Democratic lawmakers hope to make permanent a food aid program that was created to help feed children during the pandemic. The Stop Child Hunger Act would expand and extend an electronic benefit transfer (EBT) card program created as part of the American Rescue Plan stimulus bill which passed in March 2021. The EBT program is basically a debit card with a set amount of money to buy food when children are out of school. Under the American Rescue Plan, families will have access to the EBT program for the next two years. The Stop Child Hunger Act would make EBT permanent and expand it to include holidays and when school is operating remotely or under a hybrid model.
  • With the pandemic still affecting the food security of many US consumers, in June 2021 Google launched its new Find Food Support search site. The site features a Google Maps tool that helps users find the nearest foodbank, food pantry, or school lunch pick-up site. With input from No Kid Hungry, FoodFinder, and the USDA, Find Food Support includes 90,000 food resource locations in all 50 states. The site also has food aid hotlines, state-by-state benefit guides, and information for hard-hit communities, including military families, seniors, and families with children.

July 12, 2021

  • A variety of analysts agree that the most problematic semiconductor chip shortages will begin to ease in the third or fourth quarter of 2021, though it could take much of 2022 for the resulting chips to work their way through the supply chain to products. Semiconductor manufacturer Intel's Chief Executive Officer Pat Gelsinger predicted that the shortage of semiconductors that’s hurting a broad swathe of industries will peak in the second half of 2021 before starting to improve. “I don’t expect the chip industry is back to a healthy supply-demand situation until ’23,” he said in an interview. “For a variety of industries, I think it’s still getting worse before it gets better.” The supply relief will not be coming from the big, national investments in the works right now by South Korea, the United States, and Europe, according to industry publication IEEE Spectrum, but from older chip fabrication plants and foundries running processes far from the cutting edge and on comparatively small silicon wafers.
  • Commercial bankruptcy filings increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021. The number of bankruptcies per month has been volatile in 2021. Just 27 new corporate bankruptcy cases were filed in May. Some experts continue to question whether government support and easy access to capital will keep distressed companies out of court or if another bankruptcy spike will soon come, according to S&P Global Market Intelligence. "You can't kick the can down the road forever," said Robert Hirsh, a partner in Lowenstein Sandler LLP's bankruptcy and restructuring department.
  • A larger share of distressed companies upended by the COVID-19 pandemic is using court processes to restructure instead of close, according to S&P Global Market Intelligence. Nearly 62% of corporate bankruptcy filings in 2020 sought reorganizations, the highest rate for any year going back to at least 2010. Companies were less likely to liquidate in 2020, a departure from 2019 and 2018 when corporate liquidations outpaced reorganizations in bankruptcy filings. As of March 30, the share of filings seeking restructuring is larger in 2021 than in 2020. S&P analysts note that government stimulus and easy access to capital have kept at-risk companies from entering bankruptcy following a jump in filings during the early months of the pandemic in in 2020, but bankruptcies are likely to pick up again later in 2021 as companies confront the aftershocks of the pandemic.
  • Computer shipments by manufacturers increased 21.4% year over year in Q1, according to research firm Gartner. Shipments of desktop PCs continued to decline but were offset by a robust mobile PC market, with mobile PCs showing 49% growth.
  • The NAIOP Research Foundation projects a period of negative office space absorption through late 2020 and early 2021. “Given the continued challenges facing the US economy, office net absorption is forecast to be negative 18 million square feet in Q4 2020 and negative 10 million square feet in Q1 2021,” according to the forecast. “The coronavirus pandemic has led to conditions that are remarkably different from past recessions but are nonetheless challenging for the office sector.”
  • Wholesale sales of computer and peripheral equipment increased 0.9% month over month on an adjusted basis and 23.3% year over year on an unadjusted basis in May. Year-over-year comparisons for May may be distorted by the large pandemic-related sales decrease in May 2020.
  • Office equipment distributor employment increased 0.5% year over year in May. Computer and software distributor employment increased 6.1% year over year in May.

July 12, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • The national office vacancy rate, an indicator of demand for computer and office equipment repair, increased to 18.2% in Q1 from 17.7% in Q4 2020, according to Moody’s Analytics. Office vacancies had been trending around 15% to 16% nationally before the pandemic. Retail vacancy increased to 10.6% in Q1 from 10.5% in Q4 2020.
  • The NAIOP Research Foundation projects a period of negative office space absorption through late 2020 and early 2021. “Given the continued challenges facing the U.S. economy, office net absorption is forecast to be negative 18 million square feet in Q4 2020 and negative 10 million square feet in Q1 2021,” according to the forecast. “The coronavirus pandemic has led to conditions that are remarkably different from past recessions but are nonetheless challenging for the office sector.”
  • Moody’s Analytics expects the national office vacancy rate to reach 19.9% in 2021 and 20.0% in 2022, then rise past historic highs within the next few years.
  • Employment in the computer and office machine repair industry increased 8.5% year over year in May but was down 2.4% from the pandemic-related low of May 2020.

July 3, 2021

  • Consumers are paying more for computers and printers due to pandemic-related component shortages, according to the consumer news organization Consumer Affairs. Hewlett Packard PC prices, for example, are up 8% year-over-year, and printer prices have risen by at least twice that. HP CEO Enrique Lores said that higher prices resulting from component shortages may not end any time soon.
  • Federal lawmakers are developing a $52 billion proposal to boost US semiconductor chip production and research, according to Reuters news service. Computer and peripheral manufacturers are likely to benefit from expansion of the industry in the US. The draft is said to include $39 billion in production and R&D incentives and $10.5 billion to develop the National Semiconductor Technology Center, National Advanced Packaging Manufacturing Program, and other R&D programs. The proposal is expected to be included in a larger legislative proposal to spend more than $110 billion on basic US and advanced technology research to better compete with China.
  • Computer and peripheral manufactures remain largely unaffected by the semiconductor chip shortage, according to The New York Times. Some older device models may be in short supply at any given moment, but that’s because semiconductor manufacturers like AMD are focusing on higher-end, more profitable chips, so budget chips are in shorter supply. AMD has said that it is increasing chip production capacity so it can meet demand in the second half of 2021.
  • Gartner predicts worldwide smartphone sales to end users will rebound to pre-pandemic levels in 2021, thanks largely to delayed purchases of 5G devices.
  • Computer and peripheral manufacturing industry employment increased 1.8% year over year in June, according to the US Bureau of Labor Statistics.

June 30, 2021

  • Even as almost all US states are completely reopened, working from home is expected to be much more common even after the pandemic subsides. Tech support for workers for many firms shifted to a remote model instead of supporting users in an office setting. As working from home becomes more common, companies of all kinds will need to make investments in secure networks, which may drive demand for computer facilities management services. As some workers return to offices, companies will also seek to find the right blend of technologies that seamlessly support workers who are at home and those who are in the office. Shifting to work from home (WFH) models may create data security and compliance issues. Company and customer data making its way to “shadow IT” systems due to employees working from home can increase business and regulatory risk.
  • About 30% of small business owners in the US and Canada say they are experiencing a significant negative financial impact due to the COVID-19 pandemic, according to the June 2021 Road to Recovery Report by Alignable, a social media outlet for small business owners. The June results suggested improvement over May when 38% of small businesses said they were experiencing a significant negative impact. Increased availability of vaccines has improved the outlook of many small businesses. In April, the percentage of respondents that reported being fully reopened rose above 60% for the first time since October, reversing five consecutive months of declines. In May, the number of businesses reporting being fully reopened remained above 60%; 71% were open in June. Despite the pandemic, the number of new businesses being created is increasing. New business applications were up 1.2% in May 2021 compared to February, according to the US Census Bureau. Improving optimism among small businesses and rising business formations could boost demand for computer facilities management services.
  • Amid the coronavirus pandemic and worldwide economic slowdown, global IT spending fell 3.2% to just under $3.7 trillion in 2020 compared to 2019, according to Gartner. All major categories of IT spending declined except for data center systems, which was flat. Devices saw the biggest decline with a dip of 8.2%, followed by IT services (-2.7%), enterprise software (-2.4%), and communications services (-1.7%). Gartner expects IT spending to bounce back to 8.4% growth in 2021; IT services spending is projected to rise 9% and reach more than $1.1 trillion. As companies accelerate their digital transformations, IT spending is increasingly viewed as a vital contributor to the bottom line rather than a back-office expense, according to Gartner. Gartner expects global IT spending by governments to increase 5.1% to $482.8 billion in 2021. Responding to and recovering from the COVID-19 pandemic, including the management of vaccine distribution, will drive governments to spend more on their digital transformations. Global government spending on IT services is projected to rise 5.4% in 2021 to more than $168 billion.
  • As the economy continues to recover, IT services companies may target specific industry verticals that fared better during the pandemic. Energy, healthcare, legal, and financial services are moving to digitally transform quickly, according to industry insiders. Smart manufacturing is another key growth area. Internet of things (IoT) consulting and implementation are projected to be in high demand. The number of industrial IoT connections is forecast to rise from 17.7 billion in 2020 to 36.8 billion by 2025, according to Juniper Research. Even industries that were more negatively affected by the pandemic will need IT enhancements to survive. Retailers need to enhance ecommerce capabilities, and media/entertainment is spending on tech to pivot toward the new ways entertainment is consumed.
  • As IT spending begins to rebound in 2021 and businesses look to accelerate their digital transformations, IT services providers may seek to expand their service offerings to remain competitive, according to TechTarget. A wider breadth of services can help managed services providers (MSPs) build collaborative relationships with client company CIOs. Information executives are expected to look to nimble workforce strategies, which may lead to opportunities for companies that provide IT outsourcing services. Enterprises may use contract or temporary workers to help with setting up collaboration platforms, cloud technologies, and network solutions. In-demand occupations include IT security professionals, cloud architects and engineers, digital business and AI architects, and robotic process automation (RPA) engineers.
  • The pandemic changed the IT landscape in ways that are likely to be permanent, according to CIO.com. Adapting to remote work, rapid shifts in consumer behavior, and other challenges prompted IT leaders to learn that agility and resilience are of greater concern than pure cost. Many firms also learned their plans for digital transformation could be implemented at rates previously thought impossible. Leaders in IT may also have increased their tolerance for risk when adopting new technologies. With the knowledge that IT projects can move more quickly, organizations will be less tolerant of long lead times and delays.
  • As the economy continues to recover, firms are expected to ramp up IT hiring to help support their digital initiatives. About 55% of CIOs aim to increase their number of full-time IT employees, according to a recent survey by Gartner. Key areas of hiring growth include automation, security, cloud and analytics platforms, and increasing support for remote work. Network administration and data center operations are the only IT categories where CIOs expect to see negative hiring trends in 2021.
  • A global semiconductor shortage is affecting production of most types of electronic equipment, including IT gear. At the onset of the pandemic, consumer buying patterns shifted and supply chains were disrupted. Carmakers cut back on production - and computer chip consumption - while home-bound consumers ramped up purchases of computers, game consoles, and other chip-containing electronics. When auto production bounced back, the whipsaw in chip demand – combined with US sanctions on Chinese tech and bad weather – made the semiconductor shortage worse. Gartner expects the shortage could persist into Q2 of 2022. Gartner suggests chip-dependent industries extend their supply chain visibility to the silicon level to better project supply constraints and bottlenecks. Tech industry watchers suggest consumers and businesses should plan to spend more for chip-heavy products and expect extended lead and/or wait times.
  • The pandemic is accelerating CFO investments in digital strategies and IT, according to Gartner. More than 80% of CFOs surveyed by Gartner said they planned to increase spending on digital capabilities in fiscal 2021 compared to fiscal 2020. Earlier in the pandemic companies scrambled to digitize as many processes as they could to support virtual work environments. Those investments are expected to continue as firms seek to leverage technology in ways that provide a competitive edge. While digital capabilities topped CFOs’ wish lists, IT spending was a strong second with 70% of CFOs saying they planned to increase IT investments in 2021. Gartner suggests organizations should have a centralized technology roadmap that gathers inputs from all parts of the business to ensure greater buy-in, and reduce tech siloes in individual departments.

July 3, 2021

  • Commercial bankruptcy filings, an indicator of demand for computer programming services, increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021.
  • The United States today is producing roughly the same amount of goods and services as before the coronavirus pandemic, but with 8.2 million fewer workers, according to The Washington Post. Analysts cite increasing use of automation for the development. Analysts also note that many companies are struggling to attract enough workers to meet surging demand, and computer programming services are likely to benefit if the problem results in even greater reliance on automation.
  • Computer programming services may benefit from the pandemic-driven interest in the reshoring of manufacturing. Industry experts say that by creating software-driven autonomous and automated manufacturing solutions, it is possible to substantially reduce the labor cost element in manufacturing, allowing higher labor cost regions to bring manufacturing home. This is extremely timely given the desire of most nations to use manufacturing as part of their post-pandemic recovery strategy.
  • Computer programming services may focus on shifting enterprise software development to cloud-based platforms due to the pandemic-driven acceleration of the move from on-premises data centers to data centers operated by cloud service providers and colocation specialists. “By the end of 2021, based on lessons learned, 80% of enterprises will put a mechanism in place to shift to cloud-centric infrastructure and applications twice as fast as before the pandemic,” market tracker International Data Corporation (IDC) said. Enterprise spending on cloud infrastructure services increased 33% year over year in Q3 2020, according to Synergy Research Group.
  • Healthcare and computing industry experts are concerned that a lack of transparency in and collaboration on development of artificial intelligence (AI) tools may be impacting COVID-19 patient care. Some institutions have not published any results showing whether their models work, according to healthcare industry news site Stat. Concerns have also been raised about the generalizability of a given model, especially one that is tested and trained only on local data. A study published in the November 2020 issue of Nature Machine Intelligence revealed that a Covid-19 deterioration model successfully deployed in Wuhan, China, yielded results that were no better than a roll of the dice when applied to a sample of patients in New York.
  • Computer programming services industry employment increased 3.3% year over year in May, according to the US Bureau of Labor Statistics.

June 30, 2021

  • Artificial intelligence (AI) is being used in a variety of ways in response to the coronavirus outbreak, which could create opportunities for computer system design services firms. UK-based BenevolentAI used its platform to analyze a massive trove of biomedical data through machine learning to make connections that led to identifying existing drugs that could be effective in treating COVID-19 patients. BenevolentAI’s technology identified an Eli Lilly drug called barcitinib that might help COVID-19 patients. When tested on patients, barcitinib contributed to a 71% reduction in deaths among those with moderate to severe cases on COVID-19. Scientists are also using AI to reveal patterns is various data from patients infected with COVID-19 to discover why some barely experience any symptoms and others die. AI may also help doctors and scientists better understand how the novel coronavirus interacts with preexisting ailments to affect the immune system, which could lead to better outcomes for vulnerable patients. Machine learning has helped scientists at the University Oxford develop a new type of COVID-19 test that can return results in under five minutes and requires no sample preparation. The scientists believe the technology’s hardware can be miniaturized so the device can be used in places such as airports, business, and music venues. The testing device is being developed into a commercial product that could be available sometime in 2021.
  • Technology experts have noted that outdated IT systems used in various federal government agencies delayed stimulus aid disbursements and other critical services. Experts have suggested legacy IT systems led to small businesses being unable to apply for loans through the Small Business Administration and difficulties in making unemployment benefit claims. Technology insiders say federal agencies need to leverage modern private sector technologies to speed up IT modernization efforts. High numbers of new unemployment claims also crashed antiquated IT systems on the state level. Many states’ computer systems for managing unemployment benefits are more than 40 years old. The CARES Act, nor the two more recent stimulus packages, provide any funding to states for modernization of state unemployment benefit IT systems. More attention to inefficient legacy systems could lead to opportunities for computer system design firms. Globally, IT spending by governments in 2021 is expected to rise 5.1% to $482.8 billion, according to Gartner. Responding to and recovering from the COVID-19 pandemic, including the management of vaccine distribution, will drive governments to spend more on their digital transformations. Global government spending on devices is projected to increase 5.6% and reach $34.8 billion.
  • About 30% of small business owners in the US and Canada say they are experiencing a significant negative financial impact due to the COVID-19 pandemic, according to the June 2021 Road to Recovery Report by Alignable, a social media outlet for small business owners. The June results suggested improvement over May when 38% of small businesses said they were experiencing a significant negative impact. Increased availability of vaccines has improved the outlook of many small businesses. In April, the percentage of respondents that reported being fully reopened rose above 60% for the first time since October, reversing five consecutive months of declines. In May, the number of businesses reporting being fully reopened remained above 60%; 71% were open in June. Despite the pandemic, the number of new businesses being created is increasing. New business applications were up 1.2% in May 2021 compared to February, according to the US Census Bureau. Improving optimism among small businesses and rising business formations could boost demand for computer system design services.
  • Amid the coronavirus pandemic and worldwide economic slowdown, global IT spending fell 3.2% to just under $3.7 trillion in 2020 compared to 2019, according to Gartner. All major categories of IT spending declined except for data center systems, which was flat. Devices saw the biggest decline with a dip of 8.2%, followed by IT services (-2.7%), enterprise software (-2.4%), and communications services (-1.7%). Gartner expects IT spending to bounce back to 8.4% growth in 2021; device spending is projected to rise 14%. As companies accelerate their digital transformations, IT spending is increasingly viewed as a vital contributor to the bottom line rather than a back-office expense, according to Gartner. Business’ growing confidence in the recovery has triggered increased investments in computers and software, according to the Wall Street Journal. Nonresidential fixed investment, which is a proxy for capital spending by businesses, jumped a seasonally adjusted 11.7% in Q1 2021, and software and tech gear led the way, according to the Commerce Department. The gain in nonresidential fixed investments in the first quarter were above pre-pandemic levels and built on growth in Q3 and Q4 of 2020.
  • At the onset of the pandemic, many organizations increased IT security spending as they implemented distributed IT and work-from-home environments, according to a recent IDG Research Services survey commissioned by Insight Enterprises. The rapid transition to work-from-home brought new security challenges across cloud, edge, and on-premise computing environments. Even after beefing up IT security spending amid the pandemic, 80% of senior IT and IT security leaders feel their organizations have insufficient protection from cyberthreats. More than 90% of organizations surveyed said they planned to increase cybersecurity spending in 2021. Demand for computer system design services may increase as organizations address the constantly evolving nature of cyberthreats and their potential impact on distributed IT environments.
  • The ways the pandemic affected work, school, and home life will continue to drive global computing device demand in 2021 and 2022. The installed base of devices will rise 2.3% to more than 6.2 billion in 2021 over 2020, according to Gartner. The shift to remote work and school is expected to continue to erode demand for desktop computing. However, the number of laptops and tablets in use in 2021 will rise 8.8% and 11.7%, respectively. The number of smartphones in use in 2020 fell 2.6% compared to 2019, but increased product variety and more affordable 5G models will drive upgrades and a 1% increase in 2021. The global installed base of computing devices is forecast to rise 3.2% in 2022 over 2021 to 6.4 billion units.
  • A global semiconductor shortage is affecting production of most types of electronic equipment, including computer systems. At the onset of the pandemic, consumer buying patterns shifted and supply chains were disrupted. Carmakers cut back on production - and computer chip consumption - while home-bound consumers ramped up purchases of computers, game consoles, and other chip-containing electronics. When auto production bounced back, the whipsaw in chip demand – combined with US sanctions on Chinese tech and bad weather – made the semiconductor shortage worse. Gartner expects the shortage could persist into Q2 of 2022. Gartner suggests chip-dependent industries extend their supply chain visibility to the silicon level to better project supply constraints and bottlenecks. Tech industry watchers suggest consumers and businesses should plan to spend more for chip-heavy products and expect extended lead and/or wait times.
  • The pandemic is accelerating CFO investments in digital strategies and IT, according to Gartner. More than 80% of CFOs surveyed by Gartner said they planned to increase spending on digital capabilities in fiscal 2021 compared to fiscal 2020. Earlier in the pandemic companies scrambled to digitize as many processes as they could to support virtual work environments. Those investments are expected to continue as firms seek to leverage technology in ways that provide a competitive edge. While digital capabilities topped CFOs’ wish lists, IT spending was a strong second with 70% of CFOs saying they planned to increase IT investments in 2021. Gartner suggests organizations should have a centralized technology roadmap that gathers inputs from all parts of the business to ensure greater buy-in, and reduce tech siloes in individual departments.

July 8, 2021

  • COVID-19 cases in the US remain in decline despite fears that the Center for Disease Control and Prevention's (CDC) mid-May mask reversal could potentially lead to a spike. The seven-day average declined by early June to less than 20,000 for the first time since March 2020. About 48% of the country's population has been fully vaccinated as of July 8, and 55% has received at least one dose of a COVID-19 vaccine, according to the US Centers for Disease Control and Prevention.
  • Industrial facility construction completions will increase 29% year over year in 2021, according to commercial real estate services and investment firm CBRE Group. Large facilities in the 500,000-square-foot range will account for the majority of new product. Demand growth that began in 2020 will continue in intermodal hubs like the Inland Empire, Dallas, Houston, Chicago, and Atlanta markets. Demand for local infill space will also continue, spurred by the likes of Amazon, Walmart, Target, Best Buy and Costco.
  • Attorneys at Atlanta-based law firm Fisher Phillips told contractors that it is within their legal rights to compel workers to get vaccinated against COVID-19. Requiring construction workers to get a coronavirus vaccination is comparable to existing rules for healthcare workers that make flu shots mandatory in order to protect all patients and staff and keep the workplace safe, the attorneys said. The attorneys also recommended that contractors set up programs to administer vaccines on jobsites, during work hours, and free of charge, in order to get the highest participation possible while ensuring projects continue to move forward.
  • Construction workers are five times more likely to be hospitalized with COVID-19 than their peers in other professions, according to a University of Texas at Austin study. Lauren Ancel Meyers, one of the study authors, said that the findings don’t necessarily mean construction work needs to stop. “It means we need to go to great lengths to ensure the health and safety of workers when they do go to work.”
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Employment in the specialty trade contracting industry increased 2.5% year over year in June but was down 2.1% compared to June 2019.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.
  • The prices that concrete and masonry contractors paid for ready-mix concrete was unchanged month over month but increased 1.8% year over year in May.

June 24, 2021

  • Semiconductor manufacturers worldwide will have started construction on 19 new high-volume manufacturing facilities by the end of this year and will break ground on another 10 in 2022 to meet accelerating demand for chips across a wide range of markets, including construction machinery.
  • Leading construction equipment manufacturer Caterpillar warned of potential impacts ahead due to a global semiconductor chip shortage. “Although we haven’t been impacted yet, the global semiconductor shortage may have an impact later this year,” Chief Financial Officer Andrew Bonfield said in a Thursday interview. “It’s a risk and obviously we’re keeping a close eye on it.” The warning follows first-quarter revenue and profit that topped analysts’ estimates, in what Bonfield described as “very strong performance” for the start of the year fueled by construction growth in the US and China.
  • About 88% of equipment manufacturers report a positive outlook for 2021, according to a new survey released by the Association of Equipment Manufacturers. More than half (55%) of the respondents expect sales to increase or remain stable despite the ongoing impact of the global pandemic.
  • The ongoing semiconductor chip shortage is expected to spread beyond the auto industry, and may ultimately affect production of construction machinery. Industry experts say that the shortage is likely to affect some industries more than others. A significant portion of demand has shifted from auto and machinery manufacturers to consumer electronics and computer manufacturers. The entire auto industry, for example, spends around $40 billion per year on chips, about a tenth of the global market. Apple, by comparison, spends more on chips just to make its iPhones, according to banking and financial firm Mirabaud tech analyst Neil Campling. The chips used in cars and machinery also tend to be basic products such as micro controllers made under contract at older foundries, not the leading-edge production technology in which chipmakers would be willing to invest.
  • Total construction starts will increase 4% in 2021, according to Dodge Data & Analytics. "The dollar value of starts for residential buildings will increase 5% in 2021, nonresidential buildings will gain 3%, and nonbuilding construction will improve 7%. Only the residential sector, however, will exceed its 2019 level of starts thanks to historically low mortgage rates that boost single family housing,” said Richard Branch, Chief Economist for Dodge Data & Analytics.
  • Interest in autonomous construction technology is increasing as the ongoing construction industry labor shortage is compounded by the coronavirus pandemic. Among the more promising developments is artificial intelligence guidance systems. The systems may be built into new construction machinery or retrofitted to existing machinery, allowing machines to work without a human operator. Interest is highest among major construction firms that have the infrastructure, support, and internal innovation teams to dedicate to implementing the technology. Manufacturers including Built Robotics, Cyngn, Fastbrick Robotics, and Caterpillar are current leaders in the sector.
  • Construction machinery manufacturing employment decreased 2.6% year over year in April.
  • Total construction spending increased 0.2% month over month on an adjusted basis and 9% year over year on an unadjusted basis in April, according to the US Census Bureau. Residential construction spending increased 1% month over month and 27% year over year in April. Nonresidential construction spending decreased 0.5% month over month and 4% year over year in April.

July 12, 2021

  • A variety of analysts agree that the most problematic pandemic chip shortages will begin to ease in the third or fourth quarter of 2021, though it could take much of 2022 for the resulting chips to work their way through the supply chain to products. Semiconductor manufacturer Intel's Chief Executive Officer Pat Gelsinger predicted that the shortage of semiconductors that’s hurting industries from automotive to consumer electronics will peak in the second half of 2021 before starting to improve. “I don’t expect the chip industry is back to a healthy supply-demand situation until ’23,” he said in an interview. “For a variety of industries, I think it’s still getting worse before it gets better.” The supply relief will not be coming from the big, national investments in the works right now by South Korea, the United States, and Europe, according to industry publication IEEE Spectrum, but from older chip fabrication plants and foundries running processes far from the cutting edge and on comparatively small silicon wafers.
  • The CEO of wireless audio equipment manufacturer Sonos expects strong consumer electronics sales to continue post-pandemic. Patric Spence says that the company is riding three secular trends: the "golden age of audio," direct-to-home movie releases, and a hot housing market. "A lot of people now have new flexibility and freedom to work anywhere and so they're moving, they're setting up a new home and that's perfect for Sonos," he said. Consumer electronics repair services are likely to benefit from continuing industry strength.
  • The Centers for Disease Control and Prevention has issued guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings. Consumer electronics repair services may be negatively impacted if consumers put down their electronic devices and head outside as a result. Experts note, however, that interpretation of the guidance is likely to vary by state.
  • Many analysts say that consumer electronics repair services should prepare for an upcoming pandemic-related spending shift that is increasingly referred to as revenge shopping. Consumers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues. Electronics repairs may be skipped in favor of experience-based purchases as a result.
  • uBreakiFix, which currently specializes in repairing personal electronics at its corporate and franchise stores, launched a mobile repair service that sends a technician to a customer's house to fix their broken devices. Customers schedule an appointment for a technician to visit their home, office, or other location. The repairs are performed in a mobile repair vehicle.
  • Mass retailer Walmart is setting up in-store kiosks at which consumer electronics repair services will be offered as a pilot program. The company hopes to have kiosks at 50 locations by the middle of 2021, and shoppers in areas with the service will be able to access it online. The kiosks will be staffed by True Network Solutions, which is partnering with the retailer to provide the service.
  • Repair services are making greater use of video and audio chats to walk customers through troubleshooting and minor repairs. Firms are also offering touchless exchanges of devices and curbside pickup. Customers are urged to make appointments to minimize the number of people in repair shops and allow for social distancing.
  • Some consumers are turning to online resources to troubleshoot and fix problems with their devices. iFixit houses over 63,800 free manuals and 165,657 repair solutions for over 29,608 devices. DIY repairs can result in fewer job tickets for shops, but can also result in higher priced repairs if DIY attempts fail and create more damage.

June 30, 2021

  • Early in the pandemic, industry trade associations, the Community Financial Services Association of America (CFSA) and the Online Lenders Alliance (OLA), directed consumer lending firms to provide flexibility to customers who lost their jobs or had hours cut due to the coronavirus outbreak. CFSA suggests leniency on collecting past due accounts, restructuring or suspending loan payments. OLA suggests delaying delinquency notice and negative credit reports.
  • State and local authorities are issuing guidance and warnings to consumer lenders regarding their business practices. Consumer protection groups including Americans for Financial Reform and the Center for Responsible Lending have called for a cap of 36% on annual percentage rates for consumer loans to be included in any additional COVID-19 relief legislation. Opponents to the cap say it’s impractical for small-dollar lenders and would deny consumers access to much-needed loans.
  • In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act. The plan’s direct payments to consumers and further extensions of federal unemployment benefits could reduce demand for short-term payday loans. In addition to the one-time payments of $1,400 per individual, and another $1,400 for each dependent, many Americans may also receive an existing tax credit that will give most families with children a monthly payment of $300 per child. Payments are to start in July. The benefit is set to expire at the end of the year, but the Democrats aim to make it permanent. The bill also extends the $300 supplemental unemployment benefit through September 6, 2021 and opens jobless benefits to millions more Americans.
  • In early September, the Centers for Disease Control and Prevention (CDC) issued a moratorium on evictions for some renters through the end of 2020. The stimulus package passed in December extended the moratorium on evictions through January 31. On January 20, President Biden signed an executive order further extending the moratorium until at least March 31, 2021. Two days before the executive order was set to expire, the CDC extended the eviction moratorium through the end of June 2021. The moratorium could decrease the need for payday lending in the short term, but drive the need for loans when the moratorium is eventually lifted and back rent is due. In May 2021, a US Federal District judge in Washington DC ruled the CDC doesn’t have the authority to issue a nationwide eviction moratorium. The Biden administration plans to appeal the decision. The ruling doesn’t affect state of local bans on evictions. As the end of June neared, the CDC again extended the eviction pause through the end of July.
  • In July 2020, a final rule from the Consumer Financial Protection Bureau (CFPB) rescinded an Obama-era provision that would have required payday lenders to ensure borrowers can pay back loans by verifying information like rent amounts, incomes, and student loan payments. The industry has argued the verification requirements were onerous and too costly. Critics say the final rule may put more consumers into a spiral of debt at a time when many Americans have seen their incomes drop due to the coronavirus pandemic. In late October, the National Association for Latino Community Asset Builders (NALCAB), represented by Public Citizen and the Center for Responsible Lending (CRL) sued the US CFPB in US District Court to overturn the final ruling in July that removed the Obama-era protections. The lawsuit claims the ruling is unlawful under the Administrative Procedure Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act. Rohit Chopra, President Biden’s pick to head the CFPB, has said that if he is confirmed, one of his priorities will be to ensure payday lenders assess their customers’ ability to repay loans, according to The Wall Street Journal.
  • Consumer lenders, including those providing credit cards, as well as car, student, and personal loans have fared well during the pandemic, according to The Wall Street Journal. The potential for high rates of default have largely been kept at bay by direct stimulus payments to consumers, and forbearance programs for student loan and mortgage payments. Low interest rates have increased lending competition on price which has drawn more lenders into the subprime space where there is less competition. Industry watchers note that lenders are betting that interest rates will rise and offset any future increase in loan losses that may occur when the effects of stimulus and forbearances run their course.
  • Billions in federal rent aid has had trouble reaching those who need it, according to The Wall Street Journal. The rent aid program is administered by the US Treasury Department but processing aid applications and dispersing the funds has fallen on local governments, many of which have been overwhelmed by the volume of demand. In May, Treasury recommended changes to expedite payments, including loosening some documentation requirements, and allowing funds to be paid directly to renters instead of landlords. However, manually vetting and approving the applications is time-consuming, and some local officials worry looser application requirements could increase the risk of fraud. According to US government figures, about 11 million tenants are at risk of eviction. Rent aid applicants who experience delays may turn to consumer lending services to help make ends meet.
  • At the onset of the pandemic, banks cut back on credit card, auto loans, and other kinds of personal loans amid worries of massive waves of default. However, in part due to government stimulus efforts, the feared defaults never occurred. As the economy has improved, lenders are loosening up their lending standards, which may allow consumers to get loans who could not get them earlier in the pandemic, according to The Wall Street Journal. Nearly 30% of banks lowered their underwriting standards in the first quarter of 2021, according to the Federal Reserve. Some banks are reducing their credit-score requirements and offering more generous loan deals. Looser lending standards among banks could reduce demand for alternative lending options, including payday loans.

June 24, 2021

  • The American Rental Association, which represents the equipment and event rental industry, has joined a new lobbying alliance formed to convince Congress to pass more financial assistance for businesses. The Economic Bridge Coalition is one of a growing list of trade associations lobbying for a new round of pandemic aid. Groups representing gyms, amusement parks, travel agents, horse shows, and other industries say they suffered massive, unrecoverable financial losses because of social distancing restrictions and still face uncertainties as the economy recovers. "PPP [Paycheck Protection Program] was very helpful but the issue now is not so much relief but rebuilding," said John McClelland, vice president of government affairs for the American Rental Association.
  • The Knot Worldwide expects a 20% to 25% increase in weddings in 2021 and into 2022. About 47% of those 2021 weddings are expected to occur between July and October. Demand for formal wear and other wedding-related products is likely to increase as a result. Nearly half of the couples (47%) who planned to marry in 2020 but postponed have rescheduled for 2021 and later dates. A majority of couples who got engaged during the pandemic (73%) also set their wedding date for 2021. A third of couples who married in 2020 expect to have big celebrations when the Centers for Disease Control and Prevention ends restrictions larger gatherings.
  • Real disposable income, an indicator of demand for discretionary purchases, decreased 15.1% in April following a 22.7% increase in March. The decrease in personal income in April primarily reflected a decrease in government social benefits. Payments associated with the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued but were at a lower level than in March. Consumer spending decreased 0.1% in April. Spending and income are expected to rebound in the coming months as more people become vaccinated.
  • The third round of direct stimulus payments to consumers authorized by the American Rescue Plan Act coronavirus relief package signed into law in early March would allow nearly 23 million adults to pay their expenses for more than four months without going into more debt or using their savings, according to Morning Consult economist John Leer.
  • Low-income households ($15,000 to $50,000 annual income) account for over 80% of rent-to-own customers and may be more likely to default or miss payments during periods of financial distress.
  • The University of Michigan’s consumer sentiment index, a measure of consumer confidence, decreased to 82.9 in May from a 13-month high of 88.3 in April. Analysts say that the decline in consumer sentiment was triggered by sudden worries about inflation. Consumer prices have surged this year and jumped more than 4% in the past 12 months, a 13-year high. The Federal Reserve, the nation’s inflation watchdog, maintains that prices will come back down once the economy has mostly recovered from the coronavirus pandemic and pent-up demand is satisfied.

July 3, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • A new Occupational Safety and Health Administration program designed to focus inspections, outreach, and compliance assistance efforts on “companies that put the largest number of workers at serious risk of contracting the coronavirus" targets continuing care retirement communities, assisted living facilities, and skilled nursing facilities. The “national emphasis program,” or NEP, became effective in mid-March and will last up to 12 months. It also will focus on employers that retaliate against workers for making complaints about unsafe or unhealthy conditions, or for exercising other rights protected by federal law, the Department of Labor agency said. “Unprogrammed” inspections related to COVID-19 fatalities will continue to be prioritized under the program.
  • COVID-19 has introduced a fear of traditional healthcare delivery settings, especially among older adults, according to Bob Kramer, founder of aging services consulting firm Nexus Insights. The fear will drive change in healthcare delivery, and senior living settings are emerging as a key player in that change, with a major objective being to keep residents out of the hospital. “If you’re going to tell a resident’s family, in essence, ‘Well if something happens to Mom, we just call the paramedics and she goes to the ER,’ they’re going to go, ‘No, that’s not acceptable to us,’” Kramer said. “And payers are not going to put up with sending somebody that they are holding the managed Medicare plan risk for to the ER every time there’s an issue at 2 in the morning.”
  • Employment at continuing care retirement communities decreased 4.8% year over year in May, according to the US Bureau of Labor Statistics.

June 26, 2021

  • Businesses that are still reeling from the economic impact of the coronavirus pandemic will have to look for other sources of funding now that the Paycheck Protection Program (PPP) has closed. Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Subscription and loyalty programs are becoming more common as retailers seek to re-establish connections with their most valuable customers following months of separation due to the coronavirus pandemic. Convenience store chain Circle K, for example, is launching a beverage subscription program. Customers who pay $5.99 per month can have one tea, coffee, slushy or fountain drink of their choosing every day. Industry experts say the program is similar to those implemented by Burger King and Panera Bread. Sales of self-serve beverages decreased industrywide during the pandemic. Hot dispensed drinks' sales fell by a third, while cold dispensed drinks shrank by 7.9%, according to the National Association of Convenience Stores.
  • Total convenience store transactions declined 13.9% year over year in 2020, according to the National Association of Convenience Stores. Inside sales at convenience stores increased 1.5% to a record $255.6 billion while basket sizes increased 18.4%. The average basket size was $7.34 in 2020 vs. $6.20 in 2019.
  • Employment in the convenience store industry increased 7.2% year over year from the low of April 2020 and was up 1.3% compared to the pre-pandemic month of April 2019.
  • Digital convenience store goPuff, whose valuation has more than doubled in five months amid a pandemic-fueled surge in online food and grocery delivery, plans to use $1.5 billion in new funding to continue expanding across the US and internationally. The company plans to take on traditional convenience stores by offering a range of household essentials from over-the-counter medicines and cleaning supplies to snack foods and alcohol.
  • Vehicle miles traveled (VMT), an indicator of foot traffic at convenience stores, decreased 4.7% month over month in April, according to the Federal Highway Administration. VMT increased 8.6% year over year during the first four months of 2021, however. VMT was down 13.2% year over year for all of 2020.
  • The number of convenience stores decreased 1.6% year over year during 2020, according to the National Association of Convenience Stores (NACS). Experts cite the pandemic-related drop in gasoline sales and lower in-store foot traffic as key causes of many closures. “The sustained growth of online shopping and the long-term effects of the pandemic will continue to reshape consumer shopping routines and affect the overall retail landscape," said Andy Jones, NACS vice chairman of research and technology.
  • Sales in the gas station industry, which includes establishments with convenience stores increased 0.7% in value month over month in May and 28.2% during the first five months of 2021.
  • Gas prices averaged $3.06 on June 26, up from $3.03 on June 1 and $2.13 a year earlier, according to the Energy Information Administration.

July 3, 2021

  • A growing list of trade associations is lobbying federal lawmakers and the Biden administration for a new round of pandemic aid. Associations representing restaurants, hotels gyms, amusement parks, travel agents, convention and trade shows, and horse shows say they suffered massive, unrecoverable financial losses because of social distancing restrictions and still face uncertainties as the economy recovers. Analysts say that the lobbying effort is gaining traction, with Republicans already signing on to bills to give grants to restaurants and gyms.
  • Guidance from the Centers for Disease Control and Prevention (CDC) continues to recommend avoiding large events and gatherings. CDC does not provide numbers to define small and large events. CDC notes in its May 20 COVID-19 guidance, however, that "Large gatherings bring together many people from multiple households in a private or public space. Large gatherings are often planned events with a large number of guests and invitations. They sometimes involve lodging, event staff, security, tickets, and long-distance travel. CDC’s large events guidance might apply to events such as conferences, trade shows, sporting events, festivals, concerts, or large weddings and parties."
  • All 50 states have either opened coronavirus vaccinations to everyone eligible under US Food and Drug Administration emergency use authorizations, or have announced when they plan to do so.
  • Telecommuters are eager to return to in-person meetings and conventions, according to a survey by APCO Insight. The survey finds that even after adapting to the new digital workplace, 81% of professionals who attended in-person meetings and conventions before the pandemic miss doing so and would be just as likely—if not more likely—to attend in-person conferences, conventions, trade shows and other business events in the future. When asked if convention centers and event venues should be eligible for federal support and funding, 45% of Americans agreed, whether they attended in-person meetings and conventions prior to the pandemic, or not.
  • Chicago’s convention industry is cautiously planning a full slate of shows at McCormick Place for the second half of 2021. The number of major events scheduled is on par with the number of large shows McCormick Place typically hosted in pre-pandemic times, according to the Chicago Tribune. Experts note, however, that the number of shows ultimately held will largely depend on how quickly the state can reach its reopening bench marks, which hinges on a vaccination plan still in its early stages. Some researchers and industry experts in Illinois say that Chicago’s convention industry might not rebound in any significant fashion until 2022.
  • A health advisory group to the Philadelphia Convention and Visitors Bureau said that "big meetings, hundreds of people,” will not likely occur before the fourth quarter of 2021. Hopefully 60% to 70% of the population will have been vaccinated by then, leading to herd immunity from the disease, a group spokesperson said. Other precautions would still need to be in place, including better testing capabilities that are both “highly sensitive” and quick to deliver results.
  • The Center for Exhibition Industry Research told trade show promoters and vendors not to expect in-person conventions until late summer or fall of 2021.
  • Industry experts say that declining revenue may affect the future development of the convention and trade show industries. Many cities fully or partly finance the construction and operation of convention hotels to compete for events, according to the New York Times. Financing is often in the form of bonds backed by the hotels' income, as well as revenue from hospitality and tourism taxes. Declining revenue due to the coronavirus outbreak could cut the budgets of cities that used bonds to finance the construction of the hotels with the hopes of attracting more visitors.

July 11, 2021

  • A recent increase in the number of new COVID-19 cases may have stressed consumers reaching into the cookie jar again. The US surpassed 20,000 new Covid-19 cases for the fourth day in a row on July 9. The last time the country had back-to-back days of cases topping 20,000 was in May. The highly contagious Delta accounted for 51.7% of cases in the US as of July 3, according to the US Centers for Disease Control and Prevention. "We know that the Delta variant has increased transmissibility and it is currently surging in pockets of the country with low vaccination rates," CDC Director Dr. Rochelle Walensky.
  • The Publix grocery store chain has resumed giving free cookies to kids. The free cookie program had been paused since March 2020 due to the coronavirus pandemic.
  • Cookie and cracker manufactures may face new challenges as vaccines roll out and consumers return to normal spending patterns after months of unprecedented demand. Kroger, for example, is projecting same-store sales to decline 3% to 5% year over year in 2021 following 14.1% growth in 2020. Some experts say that demand for comfort food like cookies is likely to decrease due to the expected "return to normal".
  • Cookie demand has risen 25% during the coronavirus pandemic, according to Top Data, a data analytics agency. One in five Americans is consuming more than three cookies per day. About one third of Americans eat between 24 and 48 cookies a month, with nearly 40% eating more than that.
  • Many legal experts agree that corporations can require COVID-19 vaccinations for employees. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with the union before mandating a vaccine. Anti-discrimination laws also provide some protections. Under the Americans with Disabilities Act, workers who don't want to be vaccinated for medical reasons are eligible to request an exemption.
  • Consumers are increasingly buying food online due to quarantines and concern about social distancing. Cookie and cracker manufacturers traditionally sold cases of products in light packaging for display on retail shelves. Now retailers are shipping individual packages to online customers and the light packaging with little to no structure has become problematic as cookies and crackers arrive damaged. The industry will need to address packaging if consumers continue to purchase significant volumes of these goods online.
  • Employment in the cookie, cracker, pasta and tortilla manufacturing industry increased 2.8% year over year in May but was down 2.1% from the pre-pandemic month of May 2019.
  • The prices paid by consumers for cookies increased 0.7% year over year in May. Consumer prices for crackers and bread increased 1.4% year over year in May. Cookie and cracker manufacturers’ prices increased 1.2% year over year in April.

June 26, 2021

  • Workplace activity, an indicator of demand for cosmetic and beauty supplies, was still 50% below its normal level in New York and San Francisco in late June, according to mobility data from Google, which tracks the locations of its users. Only 22% of New York-area office workers were back at their desks as of June 16, according to building data from security company Kastle Systems.
  • Marketing firm Moz said that Google searches for "men's makeup looks" jumped nearly 80% year over year in 2020. Experts cite the increase in Zoom meetings for telecommuters as a key driver of the increase. More cosmetics products made for men can be found in cosmetics and beauty stores as a result, according to the CEO of male cosmetics company Stryx.
  • The global beauty market is set to surpass 2019 sales in 2021 despite the pandemic’s setbacks, according to consulting firm McKinsey. The recovery will be uneven across categories, however. Haircare, skincare, and personal care are predicted to grow in 2021, while fragrance and color cosmetics sales are expected to decrease.
  • Real disposable income, an indicator of demand for discretionary purchases, decreased 15.1% in April following a 22.7% increase in March. The decrease in personal income in April primarily reflected a decrease in government social benefits. Payments associated with the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued but were at a lower level than in March. Consumer spending decreased 0.1% in April. Spending and income are expected to rebound in the coming months as more people become vaccinated.
  • Beauty products firm Sephora plans to open shops at 850 Kohl's locations by 2023. Sephora will also launch on Kohl's website this year, offering more than 100 beauty brands, some of which are exclusive to Sephora. The Sephora shops in Kohl's stores will be about 2,500 square feet, offering most of the same services found at other Sephora stores, including help with makeup application.
  • Employment in the cosmetic and beauty supply store industry decreased 1.8% year over year in April but was up 112% from the pandemic-related low of May 2020.

July 8, 2021

  • Industry watchers suggest the shift away from brick-and-mortar retail that took hold during the lockdown will remain even as the pandemic has eased and almost all of the country has reopened. Losing commercial customers and gaining more residential business could be a mixed blessing for couriers like FedEx and UPS. The shift in volume toward residential deliveries compared to commercial ones can hurt carrier profits due to smaller package sizes, more frequent stops, and increased package sorting complexity. To help cover additional volume-related costs, UPS and FedEx instituted COVID-19-related peak surcharges. The surcharges primarily apply to large-volume shippers. Expecting another surge in package volume for the busy 2021 holiday season, FedEx and UPS both announced new peak-season surcharges. FedEx’s new surcharge fees took effect in June and UPS’s new fee scheme began in early July.
  • As the surge in ecommerce is not expected to abate once the pandemic subsides, the logistics space is seeing new entrants and drawing investment. Global investments in logistics startups reached $8.1 billion in the fourth quarter of 2020, according to CB Insights. One such firm is Pandion, founded by a former delivery executive at Amazon. Pandion aims to help retailers like Walmart, Target, and Wayfair compete with Amazon’s delivery speed by reducing the cost and congestion of the “middle mile” - the delivery gap between the warehouse and the vehicle that delivers a package to the customer’s home, according to Bloomberg. Pandion plans to operate package sorting centers and transport packages with contract trucking firms.
  • As the two biggest couriers – UPS and FedEx – increase rates and in some cases refuse volume increases by large shippers, it is creating opportunities for smaller regional players, according to FreightWaves. As shipping demand rises, the large couriers are increasingly refusing some shippers’ volume increases, especially for low-margin, difficult-to-handle freight. The imbalance between shipper demand and courier supply bandwidth is expected to give an opening to regional couriers. However, experts warn that regional players need to be careful about the new business they pick up to avoid the low-margin challenges experienced by UPS and FedEx.
  • Coming off a busy holiday shopping season in Q4 2020, couriers’ sales rose again in the first quarter. Courier and messenger services sales increased 3.9% to more than $33 billion, according to the US Census Bureau. Courier and messenger service sales were up more than 26% in Q1 2021 on a year-over-year basis.
  • FedEx’s revenue in the fiscal fourth quarter 2021 reached $22.6 billion, an increase of nearly 30% compared to the same period in fiscal 2020. At $84 billion, revenue for the full fiscal year in 2021 was up more than 21% over 2020. The company said growth in the fourth quarter was driven by increased volume in its FedEx International Priority and US consumer package services. UPS posted first quarter 2021 revenue of $22.9 billion, a 27% rise over the same period a year earlier. Both companies enjoyed increased demand from ecommerce.
  • As more businesses reopen, the balance between residential and commercial deliveries may swing back closer to its pre-pandemic state. As of July 1, 2021, all US states but Hawaii were fully reopened, according to The New York Times. On July 6, the 7-day average for daily new cases was nearly 13,000 – down slightly from the levels seen a month earlier. Accelerating vaccination rates should also drive more demand from commercial customers. On April 19, all Americans over age 16 became eligible to be vaccinated. As of July 5, more than 157 million Americans were fully vaccinated or 47% of the US population.
  • On-demand food delivery services have grown as consumers sheltered at home and many restaurant dining rooms were closed. However, with few differentiators among the top players, pressure on pricing has led to consolidation. To complement its Uber Eats unit, Uber completed its purchase of food delivery start-up Postmates in late 2020. The move also helps shore up Uber’s ridesharing business which struggled as people went out less often. Uber had shown interest in rival Grubhub, but the latter agreed to a merger with Just Eat Takeaway in mid-2020; the deal was completed in mid-June 2021. Bar closures and capacity limits increased consumer thirst for on-demand alcohol delivery services. To capitalize on the trend, Uber Eats agreed to buy alcohol delivery company Drizly in early 2021 for $1.1 billion in stock and cash. Uber’s deal for Drizly is expected to close later in 2021.
  • With a record year for package deliveries in the rearview, couriers are playing another key role as they help distribute COVID-19 vaccines. Deutsche Post estimates 10 billion doses of vaccine will be distributed on 15,000 air freight flights over the next two years. One of the many challenges of global distribution is that some of the vaccines must be stored at very cold temperatures. UPS has invested in “freezer farms” to store millions of doses at temperatures as low as -80 Celsius. FedEx also has cold supply chain facilities scattered across the world.
  • The huge spike in ecommerce demand has helped to heat up competition among couriers, according to Logistics Management. FedEx has embraced ecommerce by expanding weekend service, and catering to small- and medium-size businesses instead of some larger clients, including Amazon. UPS has tended to focus more on margins by discouraging unfavorable volumes from some customers by charging very high rates. Amazon is requiring sellers on its platform to offer next-day shipping nationwide. The move is expected to drive demand for Amazon Fulfillment and Amazon Logistics. It will also force FedEx and UPS to expand weekend pick-ups and deliveries. In late April 2021, UPS announced it would expand weekend deliveries over the coming months. By October, UPS plans for its Saturday delivery coverage to reach 90% of the US population.
  • The pandemic-induced flood of ecommerce packages has stressed FedEx’s network and the company is lagging behind rival UPS in a key metric - on-time delivery, according to The Wall Street Journal. To speed up its capacity expansion plans ahead of the busy 2021 holiday season, in late June 2021 FedEx announced it would boost capital spending by 22% to $7.2 billion in fiscal 2022. The investments aim to increase capacity, modernize its fleet and facilities, and accelerate automation efforts. FedEx said its ability to meet the ongoing surge in demand have been complicated by the difficulty of attracting enough workers.

July 3, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Commercial bankruptcy filings, an indicator of demand for computer programming services, increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021.
  • CPA practices and their clients continue to see automation as a key to revenue growth. Time-series surveys conducted during the pandemic by several organizations show that automation, particularly in areas like accounts payable and accounts receivable, was driving business growth before the pandemic set in and has continued to provide consistent momentum as 2020 progressed, according to CPA Practice Advisor. Companies that embrace automation expect future growth even in the face of the pandemic, while those that don't aren't as optimistic. The surveys also showed a direct correlation between the adoption of technology and the ability to switch to value pricing that helped grow firm revenues during the pandemic.
  • Up to 10,000 stores could close in 2021, according to Coresight Research. Retailers have announced 1,678 closures as of January 22. Coresight also forecasts that retailers will announce 4,000 store openings in 2021, driven by growth from grocery discounters and dollar store chains. Coresight tracked 8,741 closures in 2020, along with 3,304 openings. “Retail bankruptcies are just the tip of the iceberg," says James Gellert, CEO of analytics firm RapidRatings. “Companies that are weakened from a financial perspective end up cutting corners or having to make strategic decisions to invest in one thing and not another. And the ripple effect of those decisions go to weaken a whole group of supply companies and therefore an industry,”
  • The coronavirus pandemic has accelerated the shift by CPA practices from compliance services to advisory services, according to the Accounting Today news site. “This year the focus has been much more on how do I as a small business stay afloat,” said Charlotte Rushton, president of the tax professional’s customer market at accounting industry consulting firm Thomson Reuters. “How do I get the PPP loans that have been offered? What do I do once I get them? How do I apply for forgiveness?" "We’ve had a 50 percent uptick in the seminars we run to help train accountants on tools and techniques to use to make that relationship shift.”

July 3, 2021

  • The US Department of Agriculture (USDA) has begun releasing up to $44 billion for agriculture producers and businesses as part of the $6 billion Pandemic Assistance for Producers initiative created in March. A total of $11 billion has been allocated since January using available pandemic assistance funds and Tom Vilsack, USDA Secretary, says that more pandemic-related funding will be announced later in the summer along with the Build Back Better program.
  • Just 43% of farmers received a portion of the $20 billion in federal aid distributed through the Coronavirus Food Assistance Program (CFAP), according to USDA data analyzed by the CTPost newspaper. The program was a major boon for Midwest Corn Belt farmers, but in 19 states, fewer than 25 percent of farmers received a payment. The USDA said it had identified gaps and disparities in assistance both by the commodity being produced and by the type of production or farmer.
  • Farm cash receipts are forecast by the US Department of Agriculture to hit $391 billion in 2021, the best result in seven years.
  • The US Department of Agriculture (USDA) has announced a new, four-part initiative called Pandemic Assistance for Producers . The program will reach a broader set of producers with at least $6 billion, the USDA said. A new set of rules will emphasize outreach to small and socially disadvantaged producers, specialty crop and organic producers, and timber harvesters. It will also provide support for the food supply chain and producers of renewable fuel. The Coronavirus Food Assistance Program and other existing programs will fall within this new initiative. The old programs will be refined in cases where statutory authority allows.
  • Row crop farmers would see payments of $20 per acre under the $900 billion coronavirus relief bill signed into law in late December 2020. Industry experts say that the agricultural provisions in the latest coronavirus stimulus package are far more detailed than in previous aid packages — which gave Agriculture Secretary Sonny Perdue great leeway in distributing aid — and direct aid to producers and processors who hadn't yet received assistance.
  • China is forecast by the US Department of Agriculture (USDA) to import a record $27 billion worth of farm products in fiscal 2021 (started on October 1) and regain its rank as the top foreign market for American farm products following a pandemic-related decline of imports during fiscal 2020.

July 21,  2021

  • Hotel construction in the Americas decreased 11.2% year over year during Q2, according to the Hospitalitynet news site. The number of rooms in the final planning state decreased 19.8%. Europe was the only world region with a year-over-year increase in hotel rooms under construction during Q2, according to hotel industry research firm STR. Lodging Econometrics expects the number of hotel projects completed in the US to increase 11.5% year over year in 2021 despite the slow start, and to increase 11% year over year in 2022.
  • Growth in improvement and repair expenditures to owner-occupied homes is expected to remain solid throughout the year and into 2022, according to the Leading Indicator of Remodeling Activity (LIRA) from the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects a healthy pace of mid-single digit gains in annual home renovation and repair spending this year, with 4.8% growth by the first quarter of next year.
  • Total construction starts will increase 4% in 2021, according to Dodge Data & Analytics. "The dollar value of starts for residential buildings will increase 5% in 2021, nonresidential buildings will gain 3%, and nonbuilding construction will improve 7%. Only the residential sector, however, will exceed its 2019 level of starts thanks to historically low mortgage rates that boost single family housing,” said Richard Branch, Chief Economist for Dodge Data & Analytics.
  • Spending on nonresidential building projects is declining and will do so through 2021, according to a mid-year update to the American Institute of Architects’ (AIA) Consensus Construction Forecast. The AIA estimates an 8% spending drop in 2020 and just under 5% in 2021 due to pandemic-induced economic disruptions. This is the first time in nearly a decade that nonresidential construction spending has trended downwards, according to the AIA.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.

July 11, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • About 90,000 restaurants have closed permanently or long-term since the beginning of the coronavirus pandemic, according to the National Restaurant Association (NRA). That’s less than 14% of the country’s restaurants, and is lower than the 110,000 figure reported by the association in December 2020, when the executive vice president for public affairs, Sean Kennedy, described the industry’s status as “an economic free fall.” An NRA survey conducted from April 1 to April 14 found that 44% of operators expected their average sales from April to June to be higher than in March 2021. Cutlery manufacturers may benefit as a result.
  • The Centers for Disease Control and Prevention said in April that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Cutlery and handtool manufacturers are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • Home improvement retailer Lowe's said that fourth-quarter same-store sales climbed 28.1%, as consumers spent more on home projects during the pandemic. The company warned, however, that spending on DIY projects and home improvement could ease as consumers resume normal activities post-pandemic. Chief Financial Officer Dave Denton laid out three scenarios for a robust, moderate or weak market. In a robust market, the retailer's outlook for 2021 anticipates a 5% to 7% drop in demand for the home improvement sector on a mix adjusted basis. In a moderate and weak market, demand would likely drop respectively by 7% to 9% and 10%.
  • Employment in the cutlery and handtool manufacturing industry increased 7.5% year over year in May but was down 8% from the pre-pandemic month of April 2019.
  • Construction industry and consumer demand for handtools has not suffered as consumers take on DIY projects during the quarantine and many construction projects in-process continued. Sales of handtools may increase as sharing on the construction or jobsite has become less acceptable out of concern for transmitting the coronavirus.
  • The prices that cutlery and handtool manufacturers charge for mechanics’ hand service tools increased 2.9% year over year in May. Prices for saw blades and handsaws increased 1.7% in May, while prices for edge handtools increased 1.1%.
  • Construction industry and consumer demand for handtools has not suffered as consumers take on DIY projects during the quarantine and many construction projects in-process continued. Sales of handtools may increase as sharing on the construction or jobsite has become less acceptable out of concern for transmitting the coronavirus.
  • The global kitchen knife market is forecast to grow 4.1% annually from 2020-2024, according to Technavio. Non-electric knives will be the leading segment and the introduction of consumer ceramic knives will be a major factor driving sales. The COVID-19 pandemic is expected to have a negative impact on producers but a neutral impact on the consumer market for kitchen knives.

July 3, 2021

  • Many Americans are going back to restaurants as vaccination rates increase and the number of new COVID-19 cases decrease, according to a June Associated Press/NORC Center for Public Affairs Research poll. About three-quarters of frequent restaurant patrons before the pandemic said that they will now return. A year ago, only about half said that they would go to restaurants if they could.
  • Kroger, the largest supermarket chain in the US, said that it expects sales at stores open for at least one year (comparable sales) to decline by 3% to 5% year over year in 2021. Sales increased 14.1% year over year in 2020. Kroger cited the end of consumer stockpiling and the availability of coronavirus vaccines, which makes it possible for consumers to shift back to eating more meals at restaurants and outside of their homes, as a key cause of expected lower sales growth.
  • Other grocers have also forecast year-over-year sales decreases. Discount grocer Grocery Outlet said that comparable sales in the first quarter of 2021 are likely to decline into the high-single digits. Sales rose 12.7% last year. Sales at Sprouts Farmers Market increased 6.9% year over year in 2020, but the chain said that sales growth will decline to low-to-mid-single digits this year. Walmart projects comparable sales to grow by low single-digits in 2021 after 8.6% growth last year.
  • The Pfizer-BioNTech COVID-19 vaccine no longer needs to be kept at super-cold temperatures, according to updated stability data. The news may reduce concerns about adequate dry ice supplies voiced by dairy product manufacturers. Dairy cultures must be kept at sub-zero temperatures prior to use. The Pfizer-BioNTech vaccine initially had to be shipped in specially-designed containers that must be topped up with dry ice every five days. The latest data brings the Pfizer-BioNTech vaccine in line with other approved vaccines.
  • The $900 billion coronavirus relief bill signed into law in late December 2020 includes $400 million to buy milk for processing into dairy products that would then be donated to food banks and other charities. Dairy producers are also eligible for payments through a supplemental version of the Dairy Margin Coverage (DMC) subsidy that makes up to an additional $470 million available. Payments would be based on 75% of milk production in 2019 that exceeded the volume already covered by the DMC.
  • Organic dairy product manufacturers have not been hit as hard as other dairy product manufacturers during the coronavirus pandemic, according to Dairy Foods Magazine. “There are relatively small amounts of organic that are used in foodservice,” said Joe Baird, CEO of Willows, Calif.-based Rumiano Cheese Company. “Accordingly, the reduced restaurant sales have not hit organic as severely as they have hit conventional.” Baird said that organics tend to be stronger in retail, and organic dairy product manufacturers may be benefiting as a result.

July 3, 2021

  • Analysts say that the supply of server CPUs, such as those used in data centers, looks steady because they produce more profit for chip manufacturers than their other products, so they’ve been prioritized. Things look bleaker in other data center industry subsectors. Network-switch vendors are dealing with extraordinarily long silicon lead times, leaving their executives trying hard to convince stock analysts of their ability to source enough to meet their revenue forecasts for the year. Companies have been spending a lot more time and money than normal on supply chain management. One large power and cooling infrastructure equipment vendor said it will likely pass this extra cost to its customers.
  • Pandemic-related telecommuting has significantly reduced overall energy demand and offsets any increase in data center energy consumption caused by telecommuting, according to the Datacenter Dynamics industry news site. Newer data center designs and innovative technologies such as solid state batteries and hydrogen cells positively impact the sector’s carbon footprint target as they are used to replace emergency power generated by fossil fuels.
  • Rapid data processing and hosting services industry growth, accelerated by the coronavirus pandemic, has prompted Nvidia to develop its first data center CPU. Industry experts say that the new CPU targets artificial intelligence needs. Nvidia’s CPU will use Arm technology, which has not found wide acceptance in the data-center market. Nvidia has agreed to acquire Arm at a $40 billion valuation, but the acquisition has been challenged on many fronts, leading to considerable uncertainty about its completion.
  • Some enterprises are seeking shorter data center lease terms as they re-evaluate their IT needs in the wake of the pandemic, according to commercial real estate services and investment firm CBRE. Hybrid models, where some workloads are handled on-site and others in the cloud, are gaining traction, according to Prime Data Centers CEO Nicholas Laag. “Large enterprises were already migrating many workloads to the cloud. The concept of a distributed workforce has accelerated that adoption, as well as the decision to deploy hybrid cloud models and consider sale-leaseback scenarios to reduce overhead and focus on their business,” Laag said.
  • A panel of investment bankers who advise data center operators said that the industry appears set for a sustained boom, fueled by the acceleration of digital transformation across the business world as a result of the pandemic. Much of the growth will be driven by hyperscale cloud service providers, which will have deployed 2.1 million new IT racks between 2020 and 2025. The expected deployments translate to roughly $62 billion in capital spending on data center infrastructure, according to 451 Research’s projections. “These incremental deployments … won’t be made solely by the cloud players themselves,” Jonathan Schroth, research analyst for data center services and infrastructure at 451, said. “They will need to work with these data center providers and operators to expand their footprints, especially in the markets where they are not located today.”
  • Data storage requirements are rising due to increasing use of data-generating IoT products like remote connected health monitoring solutions, packaging and shipping trackers, and streaming devices. Use of IoT products is rising due to greater reliance on telecommuting, telehealth, and telelearning. Industry experts say that many companies are now looking at establishing smaller locations closer to the customer, reducing reliance on larger data centers with central data resources. For medium- to large-size companies, deploying many more of those edge data centers means they need their own specific storage. It is a fundamentally different architecture that is required to increase the speed at which data can be accessed and processed.
  • A new crop of companies is chasing the business opportunity in building edge data centers to reduce network latency for end users and cut data transport costs. Companies including EdgeMicro, Vapor IO, and Compass EdgePoint are expanding in markets for content, cloud, and telecommunications that are underserved by the largest data center providers. EdgeMicro announced plans in August for new locations in Cleveland, Indianapolis, Memphis, Houston, and Pittsburgh. Without using edge data centers in Houston, for instance, internet traffic in the metro has to be served from the nearest major network hub in Dallas, which is 240 miles away. Building a smaller hub in Houston improves performance for end users there and eliminates the cost of moving data between Dallas and Houston for content companies.

June 24, 2021

  • Businesses including day spas and tanning salons are reopening just as a coronavirus variant that World Health Organization officials said is "faster" and "fitter" than previously identified ones begins spreading in the US. The Delta variant, which is believed to be more transmissible and cause more severe disease, could cause an upsurge in infections, but the levels will vary depending on the rates of vaccination in each area, said Scott Gottlieb, former commissioner of the US Food and Drug Administration. The Delta variant was first identified in India, which experienced a devastating surge in cases and deaths during May.
  • Visits to day spas and tanning salons are likely to rebound if the number of COVID-19 cases continues dropping as vaccination rates increase. About 45% of the country's population has been fully vaccinated as of June 24, and 53% has received at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention.
  • All 50 states have either opened coronavirus vaccinations to everyone eligible under US Food and Drug Administration emergency use authorizations, or have announced when they plan to do so. Day spas and tanning salons are likely to benefit if social distancing restrictions are eased as vaccination rates increase.
  • Many analysts say that businesses should prepare for an upcoming pandemic-related spending shift that is increasingly referred to as revenge shopping. Shoppers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues.pping. Shoppers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.

May 26, 2021

  • Many funeral homes have seen families opt for cremation and delayed memorial services in response to the COVID-19 outbreak. More Americans have opted for cremation over the years, surpassing burials in 2017, according to the National Funeral Directors Association (NFDA). The pandemic has accelerated the trend, according to the NFDA. More families opting for cremation could present challenges for many funeral directors as burials are much costlier, and are more profitable, than cremations. Cremation may also be preferable as it doesn’t involve embalming which in deceased COVID-19 patients can present risks to workers who perform embalming. Some funeral homes have ceased offering embalming services unless it is legally required (such as when a body is entombed in a crypt).
  • Restrictions on gatherings create challenges for funeral homes and their clients’ ability to have viewings and memorial services. Funeral homes are making use of live streaming options to record and broadcast viewings and memorial services, so family and friends can attend remotely and send condolences electronically. To accommodate larger numbers of mourners while maintaining social distancing, some funeral homes stagger attendance of funerals and viewings into small groups. Other adaptations include drive-through casket viewings and visitations, and simulcasting services on large movie screens in cemetery parking lots which mourners can view from their cars. While many of these adaptations may wane as the pandemic abates, some funeral directors believe tech-enabled remote services and more outdoor service offerings will remain.
  • Daily new COVID-19 cases began rising rapidly in the fall and winter, but new cases were dropping rapidly by mid-January. On May 24, the 7-day average for new cases was just over 25,000 – about one-tenth the number seen during the peak in early January. Hospitalizations and deaths have also fallen significantly. Wider vaccine availability has slowed COVID-19 death rates. As of May 24, 285 million doses of vaccine had been administered and 39% of the US population was fully vaccinated. As vaccination rates have risen, capacity limits on businesses – including funeral homes – are gradually being lifted. As of May 24, 34 states were reopened.
  • In hard hit areas of the country, crematoriums that typically made daily pick-ups from funeral homes pushed back several days because their volume increased significantly. Funeral homes held remains for longer periods of time, while they were overwhelmed with increased volume. Some funeral homes reported being better prepared for rising cases than they were for the wave that occurred over the summer. During the peak of the pandemic, some funeral homes handled as many deaths in a couple of months as they would normally see in a year, according a spokesperson with the National Funeral Directors Association.
  • Coronavirus has prompted consumer advocates to urge the Federal Trade Commission to update its regulation of funeral homes. Rules in place since 1984 require funeral homes to offer detailed pricing information if asked in person or over the phone. Advocates are calling for the rule to be amended to require funeral homes to include pricing on their websites to make it easier for consumers to research funeral services without leaving home.
  • The COVID-19 relief bill passed in December of 2020 included $2 billion in reimbursement funding for people who faced hardship in having to pay funeral costs related to the death of a loved one from COVID-19. Eligible recipients can receive up to $9,000 per funeral and up to $35,000 if numerous family members were lost to COVID-19. The program is only open for those whose loved one died between January 20, 2020 and December 31, 2020. Many funeral homes are working with families to help them gather the necessary documentation to apply for reimbursement. The program, which launched in April, is administered by the Federal Emergency Management Administration (FEMA). Eligible expenses include, caskets, urns, burial plots, headstones, officiant services, and cremation and burial costs. Applicants must register by phone. Like many pandemic-related relief programs, the funeral reimbursement program has been a magnet for fraudsters, according to CNBC.

July 21, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Spending on dental care could decline by up to 20% in 2021, the American Dental Association (ADA) projects. More than 46% of dentists surveyed by the ADA said that their patient volume was down at least 15% from usual levels during the week of October 5.
  • The Centers for Disease Control and Prevention has said that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Dental laboratories are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.

July 4, 2021

  • Businesses including dental practices are reopening at full capacity and with fewer social distancing restrictions just as a coronavirus variant that World Health Organization officials said is "faster" and "fitter" than previously identified ones begins spreading in the US. The Delta variant, which is believed to be more transmissible and cause more severe disease, could cause an upsurge in infections, but the levels will vary depending on the rates of vaccination in each area, said Scott Gottlieb, former commissioner of the US Food and Drug Administration. The Delta variant was first identified in India, which experienced a devastating surge in cases and deaths during May. Practices that have stopped following some pandemic-related safety practices may need to consider re-implementing them. The Los Angeles County Department of Public Health advised all residents in late June to wear masks while they’re in public indoor spaces — even if they’re fully vaccinated against COVID-19.
  • About 96% of adults are comfortable visiting the dentist as of early June, according to the American Dental Association. Patient volume in US private practices was at 86% of pre-COVID-19 levels. Patient volume has remained at high levels for the last two months.
  • The New York State Department of Financial Services, which regulates insurance firms, published guidelines directing medical, dental, and vision insurers to combat personal protective equipment (PPE) surcharges. Some dentists in New York State and elsewhere are adding a COVID-19 surcharge to help cover the cost of upgraded PPE that they say is essential for keeping employees safe during the pandemic. Insurance companies can't allow dentists in their network to charge members PPE fees and must get previously paid surcharges reimbursed, state regulators said. The American Dental Association has urged dental health plans to begin reimbursing a new fee to cover the expense. Some health plans have done so, but others haven’t, which can leave patients paying the bills.
  • Some insurance providers subsidize PPE costs, and other contracts don’t allow for customers to be held liable for additional fees tacked on later. The rules vary from state to state and provider to provider, depending on whether the fee is disclosed upfront and what a client’s insurance policy covers.
  • Maryland Attorney General Brian Frosh has issued an advisory, warning dentists that charging PPE fees may violate the Consumer Protection Act. Insurance laws typically prohibit participating providers from charging fees to insured consumers. Kimberly Cammarata, Assistant Attorney General and director of the state Health Education and Advocacy Unit (HEAU), said that the unit has received 17 complaints about PPE fees in the range of $10 - $40 per visit. “We heard anecdotally from other carriers that one provider was charging $172, another was charging $300,” Cammarata said. The fee may be acceptable when patients see an out-of-network provider or don’t have insurance, Cammarata added. The American Dental Association has said that it’s unethical to only charge uninsured patients or only seek reimbursement for these fees from insured patients.
  • The New York State Department of Financial Services, which regulates insurance firms, published guidelines directing medical, dental, and vision insurers to combat personal protective equipment (PPE) surcharges. Some dentists in New York State and elsewhere are adding a COVID-19 surcharge to help cover the cost of upgraded PPE that they say is essential for keeping employees safe during the pandemic. Insurance companies can't allow dentists in their network to charge members PPE fees and must get previously paid surcharges reimbursed, state regulators said. The American Dental Association has urged dental health plans to begin reimbursing a new fee to cover the expense. Some health plans have done so, but others haven’t, which can leave patients paying the bills.
  • The World Health Organization (WHO) issued guidance advising people to delay routine dental cleanings "...until there has been a significant reduction in covid-19 transmission rates, or according to official recommendations at national, subnational, or local levels.” WHO cited the role of aerosols in the “rapid contamination of surfaces and potential for the infection to spread” and called for more research into common dentistry practices that produce the tiny floating particles that might cause infection if inhaled, Reuters reported. “The likelihood of COVID-19 being transmitted through aerosol, micro-particles or airborne particles ... today I think is unknown. It’s open to question at least. This means that more research is needed,” Benoit Varenne, a WHO dental officer, said during a news briefing.
  • The American Dental Association (ADA) released a statement stating that it "respectfully yet strongly disagrees" with the World Health Organization's interim guidance recommending that "routine" dental care be delayed in certain situations because of COVID-19. The ADA Board of Trustees adopted an ad interim policy stating dentistry is essential health care, and will consider it as a resolution during its virtual meeting in October. "Millions of patients have safely visited their dentists in the past few months for the full range of dental services," ADA President Dr. Chad P. Gehani said. "With appropriate PPE, dental care should continue to be delivered during global pandemics or other disaster situations."
  • The Department of Labor has concluded that dentists, dental hygienists, and dental assistants have the highest exposure to the disease, ranking alongside respiratory therapy technicians and oral surgeons. The instruments used by dental practices create aerosol clouds that can hold germs for up to three hours, increasing the odds of exposure for staff if a patient has the coronavirus.

July 10, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • The Centers for Disease Control and Prevention has issued guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings. Diet and weight reducing centers are likely to benefit from the relaxed restrictions. Experts note, however, that interpretation of the guidance is likely to vary by state.
  • The Centers for Disease Control and Prevention said that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Diet and weight reducing centers are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • A Cleveland Clinic study completed in late 2020 shows that overweight people are at a higher risk for developing a more severe form of COVID-19, which may require hospital admission, need for intensive care, and the use of a ventilator. The Obesity Society corroborates the Cleveland Clinic’s study, reporting, “people with severe obesity, management of COVID-19 may also be compromised by challenges in diagnosis and treatment caused by the physical effect of their obesity.” More than 70% of adults in the US are overweight or have obesity, the Centers for Disease Control and Prevention reports on its website.
  • Nearly 70% of respondents to a survey conducted by University of Texas researchers reported that it was more difficult to achieve their weight loss goals during the pandemic, with about half spending less time on exercise. The researchers said that interventions including telehealth options and outreach efforts are needed to improve outcomes.
  • A study by Nutrisystem revealed that sheltering in place led to weight gain of up to 16 pounds for 76% of Americans. Instead of focusing on a “summer body,” Americans are now working towards a “post-quarantine body.”

July 10, 2021

  • Industry experts recommend that direct mail advertisers remain focused on move updates to customer data. Nearly 36 million address changes were processed by the USPS in 2020 alone. The US Postal Services processes more than 98,000 address changes daily. New movers are twice as likely to change brands or service providers, have a keen interest in upgrading services, and consider direct mail a highly valued channel for receiving information during a move, according to address management solutions firm Melissa. They also tend to spend big on home-related needs within the first three months of a move, with expenditures greater than what non-movers spend in five years.
  • Real disposable income, an indicator of demand for discretionary purchases, decreased 2.8% in May following a  15.1% in April and a 22.7% increase in March. The decrease in personal income in May and in April primarily reflected a decrease in government social benefits. Payments made to individuals from the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued in May, but at a lower level than in April. Unemployment insurance also decreased, led by decreases in payments from the Pandemic Unemployment Compensation program. Consumer spending was unchanged in May. Spending and income are expected to rebound in the coming months as more people become vaccinated.
  • Direct mail advertising firms with business-to-business (B2B) clients may benefit as social distancing restrictions are reduced and people return to work at their places of business. Reaching corporate buyers in their offices became impractical if not impossible with most people at home. New Centers for Disease Control and Prevention guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings is likely to benefit direct mail advertisers even though interpretation of the guidance is likely to vary by state.
  • Luxury brands will be betting on traditional forms of marketing as the pandemic wanes, according to Vogue Business. Channels including direct mail will be used to diversify from digital advertising, where recent privacy changes make it more difficult for brands to reach customers. “Digital is so fast that we were missing the ability to talk about our brand, what we care about and what we stand for,” says Mansur Gavriel’s chief executive Isabelle Fevrier. “[Direct mail] is a way for us to tell our story long-form, which appeals to us, because Mansur Gavriel has always been focused on art and photography and [not just clothes].” Digital marketing is also becoming “much more expensive”, she adds.
  • Advertising spending in the US won’t recover until 2023, according to Forrester Research. The advertising industry is expected to lose 52,000 jobs between 2020 and 2021.

July 4, 2021

  • Some distilleries that pivoted to making hand sanitizer during the coronavirus pandemic are now stuck with products that they are struggling to sell. “We’ve got about 5,000 bottles,” said  Ferino Distillery owner Joe Cannella, whose inventory includes a mix of 4-ounce squeeze bottles, 40-ounce spray bottles and 60-ounce refill jugs. “My only option at this point would be to basically sell it at a loss — I could get it out the door, but I’d have to sell it for pennies compared to what we made it for. And that’s something I’m interested in doing probably in the near future just to get something.” Cannella says many distillery owners are in the same boat.
  • Craft distillers are projected to lose $700 million in annualized sales, a loss of 41% of total craft business, due to lost tasting room sales and lost wholesale sales, according to the Distilled Spirits Council of the United States (DISCUS). DISCUS anticipates an increase in tourism at some point in 2021 that is expected to boost craft distillery sales.
  • A 25% retaliatory tariff on American Whiskey that DISCUS says was imposed by the European Union in response to US Section 232 tariffs on steel and aluminum resulted in American whisky exports to the EU dropping 41%, year over year in 2020.
  • Distilleries are likely to benefit from the addition of the Craft Beverage Modernization and Tax Reform Act (CBMTRA) to the $900 billion coronavirus relief package signed into law in late December. The CBMTRA will make existing federal excise tax rates for distillers and brewers permanent. The current Federal Excise Tax rates for small and independent breweries, which were set to expire on December 31, 2020, could have increased as much as 100% if the CBMTRA was not passed.

June 5, 2021

  • Asmodee and Z-Man Games have revealed the next title in the Hot Zone series, a product that was likely the most eerily timely game of 2020: Pandemic: Hot Zone North America. Players race to cure and contain the spread of viruses that are moving across the US, Canada, and Mexico. Pandemic: Hot Zone Europe will allow players work together to discover cures to three different diseases, while moving across a map of Europe. Mutation cards dictate the difficulty of the game.
  • Doll and toy manufacturer Mattel reported a 47% year over year Q1 sales increase, with doll sales increasing 69% led by an 87% gain for Barbie. Sales worldwide for the action figures, building sets, games, and other segment also rose 69%. Sales for the infant, toddler and pre-school, and for the Wheels segments increased 31% and 16%, respectively. Industry experts cited ongoing social distancing measures as key growth drivers.
  • Toy sales increased 16% year over year to $25.1 billion in 2020, according to The NPD Group. Analysts attribute the increase to a shift from spending on summer camps, movie theater tickets, theme parks, or vacations to toys for home use. Parents and grandparents  who experienced “COVID guilt” spent more to treat children with toys during the holiday season.
  • The $1.9 trillion American Rescue Plan Act, which provided a third round of economic stimulus direct payments of up to $1,400 to Americans, also provides an additional $300 per week in unemployment benefits through September 6.
  • Many analysts say that businesses should prepare for an upcoming pandemic-related spending shift that is increasingly referred to as revenge shopping. Shoppers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues. A significant portion of sales may shift away from products like dolls, toys, and games as a result.
  • Real disposable income, an indicator of demand for discretionary purchases, decreased 15.1% in April following a 22.7% increase in March. The decrease in personal income in April primarily reflected a decrease in government social benefits. Payments associated with the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued but were at a lower level than in March. Consumer spending decreased 0.1% in April. Spending and income are expected to rebound in the coming months as more people become vaccinated.

June 5, 2021

  • About 45% of the 3,597 large retail stores that will open in the US this year are dollar stores, according to Coresight Research. Economists say that the development is a reflection of the dollar store sector’s outsized growth in the retail industry as other chains close shops or stop building new ones due in part to the effects of the coronavirus pandemic.
  • Dollar Tree plans to open hundreds of new "combination stores" in an attempt to be a one-stop shop for consumers looking to buy pandemic essentials. Company officials say that the stores combine "Family Dollar’s great value and assortment with Dollar Tree’s thrill of the hunt and fixed price-point — creating a new strategic store format targeted for small towns and rural communities with populations of 3,000 to 4,000. These are markets where the company would traditionally not open a Dollar Tree store alone."
  • Discounters like dollar and general merchandise stores are likely to be among the biggest beneficiaries of an expected post-pandemic surge in consumer spending, according to investment bank JP Morgan Chase. Stimulus checks hitting millions of bank accounts, and the enhanced child tax credit included in the relief package mean that many families are receiving more than they did in the other rounds of government aid. The money is arriving as accelerating vaccine rollouts make shoppers more comfortable about going out.
  • Dollar General executives say that the vaccine rollout and a reopening economy would lead to a bigger-than-expected slowdown in sales for discounted groceries, while a new round of stimulus may be tougher for the company to take advantage of than before. “Compared to the previous stimulus rounds, which helped us, the economy is now opening up more. We are competing with other segments of the economy outside of retail for that share of wallet, so how much we get is uncertain,” Dollar General finance chief John Garratt said.
  • The latest round of $1,400 stimulus payments that is going mostly to lower- and middle-income households was expected to provide at least a temporary boost for dollar and general merchandise stores, but Dollar General executives said that there was too much uncertainty about how much the company could benefit to include it in its outlook.
  • The promise of a return to relative normalcy later this year as more Americans get inoculated against COVID-19 has made the boom in pantry stocking, which made Dollar General one of the bigger retail beneficiaries of the health crisis, unlikely to be repeated, Garratt added.

June 22, 2021

  • Oil markets have rebounded from the dramatic drop seen early in the pandemic Global oil demand is expected to rise above pre-pandemic levels by the end of 2022, according to the International Energy Agency’s (IEA) June 2021 Oil Market Report. After a record decline of 8.6 million barrels per day (b/d) in 2020, global oil demand is forecast to rebound by 5.4 million b/d in 2021, then add another 3.1 million b/d to reach a total of 99.5 million b/d by the end of 2022. However, the IEA expects aviation fuel demand to be the slowest to recover as air travel takes more time to return to pre-pandemic levels. Gasoline demand will also be challenged by ongoing work-from-home policies and electric vehicle adoption. Petrochemical demand, primarily for plastics production, is forecast to be a key driver of increased oil demand. To meet the gradual increase in global oil demand, the IEA says major producers, including OPEC+ nations and the US will have to increase production.
  • After being driven down by low prices and weaker demand earlier in the pandemic, the number of oil rigs in operation is starting to rebound. The US rig count as of June 18, 2021 was 470, up nine from the prior week and 204 higher than a year earlier, according to Baker Hughes Rig Count. Propped up by higher oil prices, new US drilling activity is expected to increase throughout 2021, according to the Energy Information Administration (EIA). US crude production is estimated to have fallen to an average of 11.3 million barrels per day (b/d) in 2020 from 12.2 million b/d in 2019. Crude production is projected to reach 11.1 million b/d in 2021, then average about 11.8 million b/d in 2022. The EIA expects the price for West Texas Intermediate crude oil to remain above $60 per barrel through 2022.
  • US liquid fuel and petroleum consumption has bounced back from the low point seen in the first half of 2020, according to the Energy Information Administration (EIA). Total US liquid fuels consumption for 2020 averaged 18.12 million barrels per day (b/d), down 2.42 million b/d from 2019. In June 2021, the US Energy Information Agency’s (EIA) Short Term Energy Outlook forecast global petroleum and liquid fuels consumption would average 97.7 million barrels per day (b/d) for all of 2021, which is up about 5.4 million b/d over 2020. US natural gas consumption fell 2.1% in 2020, primarily due to less gas use by the power sector. US natural gas consumption is forecast to fall 0.5% in 2021 due to higher prices reducing the use of natural gas by electric power plants. The ongoing economic recovery is expected to drive an increase in industrial natural gas consumption in 2021. Residential and commercial consumption are also projected to increase.
  • In the first quarter of 2021, eight North American exploration and production (E&P) firms filed for bankruptcy; the total number of E&P Chapter 11 filings in 2020 was 46, according to Texas-based corporate law firm Haynes and Boone. As oil prices fell during much of the pandemic, some producers had trouble securing additional credit to stay afloat. The aggregate secured and unsecured debt for North American oil and gas producers in 2020 was comparable to that of the previous downturn in 2016. However, higher oil prices and rising rig counts may slow the rate of bankruptcies among exploration and production firms.
  • Exploration and production (E&P) companies slashed capital expenditures in 2020. Together, 2020 writedowns by BP, Royal Dutch Shell, and Exxon totaled $51.4 billion, according to Bloomberg. In 2021, US E&Ps are expected to further reign in spending, reducing capex by about 8% compared to 2020, according to a Raymond James survey of mid-to-large E&P firms released in April 2021. On a global basis, upstream oil and gas investment is expected to rise about 10% in 2021, according to the IEA. However, investments are projected to remain well below pre-pandemic levels. Investments among oil and gas majors are likely to remain flat while national oil firms increase spending in hopes of gaining market share in the event of a major uptick in global demand, according to the IEA.
  • When oil prices hit the $40 per barrel mark in mid-2020, fracking activity was utilizing an unusually high inventory of drilled but uncompleted wells (DUCs) – especially in the Permian Basin. However, drilling and well completion activity grew in the first quarter of 2021 as higher rig and frac crew counts led to increased production, according to S&P Global Platts Analytics. Well completions have tended to outpace drilling, which has reduced the US DUC inventory. A lower number of DUCs could drive the need for new drilling activity.
  • The pandemic and resulting drop in oil consumption fueled consolidation in the US shale oil industry, according to the New York Times. In January, Conoco Phillips finalized its acquisition of Texas-based Concho Resources. In October, Chevron completed its purchase of Nobel Energy. While higher oil prices have driven some buyer interest in 2021, upstream oil and gas merger and acquisition activity in the first quarter 2021 was down 88% compared to the fourth quarter of 2020, according to energy industry software firm Enverus. While 2020 saw considerable M&A activity among larger public firms, so far, 2021 M&As have been lower-tier companies, including private ones. Consolidation may be a method for keeping rig counts from rising too high and sending production into oversupply territory which could push prices down.
  • The ripple effects of production cuts and other supply chain disruptions earlier in the pandemic are driving drilling costs upward. Prices for steel, cement, diesel, and labor may push oil and gas field inflation to 12% by the end of 2021, according to Bloomberg reporting of Citigroup analysis. Tight competition in the North American market can prevent oilfield services firms from passing their higher costs on to their oil and gas production firm customers. Some drillers may look to markets outside the US and Canada for better growth opportunities.

July 10, 2021

  • Pharmaceutical companies Pfizer and BioNTech said in early July that a third dose of their coronavirus vaccine, given six months after a second dose, appears to preserve "the highest levels of protection" in those who were vaccinated. A Pfizer spokesperson said that the company plans to file for emergency use authorization for a booster dose with the US Food and Drug Administration in August.
  • Wholesalers are likely to benefit from increasing eligibility for coronavirus vaccinations. An advisory committee to the Centers for Disease Control and Prevention voted in May to recommend the Pfizer-BioNTech coronavirus vaccine for use in children ages 12 to 15. About 48% of the country's population has been fully vaccinated as of July 10, and 55% has received at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention.
  • Executives from pharmaceutical distributors Cardinal Health, AmerisourceBergen, and Henry Schein asked the director of the Federal Emergency Management Agency to develop a plan of action “to maximize the resilience and efficiency of the Covid-19 vaccine distribution system by utilizing the entire US commercial medical supply and pharmaceutical distribution system,” according to Bloomberg News. The immunization operation is the largest and most complex public-health effort in U.S. history and requires the entire medical infrastructure, the companies said. The distributors haven’t participated in vaccine distribution. McKesson Corp. is handling two of the three Covid-19 vaccines now available in the US through a federal contract that predates the pandemic.
  • The Food and Drug Administration has postponed hundreds of drug company inspections due to the Pandemic, according to The New York Times. The postponements are creating an enormous backlog that is delaying new drug approvals and leading the industry to warn of impending shortages of existing medicines. Pandemic-related travel restrictions and safety concerns have also hampered the ability to ensure the safety of the ever-increasing number of imported medicines, which make up more than 60% of the drugs sold in the US.
  • The pandemic has worsened shortages of dozens of essential drugs, especially injectable generics, according to CNBC. Industry experts cite supply chain issues related to the offshoring of about 80% of the production of generic drugs and ingredients, principally to India and China in search of lower costs, as the key cause. Martin VanTrieste, a former chief quality officer at pharmaceutical giant Amgen, said that manufacturers are incentivized to move production out of the US to areas with lower labor costs, lower regulatory compliance costs, and direct or indirect government support to build new facilities.
  • Wholesale sales of drugs increased 9.7% in value year over year during the first five months of 2021, according to the US Census Bureau.

June 22, 2021

  • The pace of coronavirus vaccinations has slowed and the nation is unlikely to reach President Biden's July 4 benchmark of having 70% of the adult population get at least one shot by July 4. About 45% of the country's population has been fully vaccinated as of June 22, and 53% has received at least one dose of a COVID-19 vaccine, according to the US Centers for Disease Control and Prevention. People who are on the fence about getting a shot are more likely to get one if it is as easy as walking into a local pharmacy without an appointment, said Dr. Taison Bell, a critical care and infectious disease physician at the University of Virginia.
  • Retail pharmacies are playing a critical role in the vaccination process, according to officials from the National Association of Chain Drug Stores (NACDS). "Based on conservative assumptions, pharmacies have the capacity to meet the demand for 100 million vaccine doses in one month," NACDS president and CEO Stephen Anderson said.
  • Sales in the health and personal care retailing industry, which includes drugstores and pharmacies, increased 1.8% in value month over month on an adjusted basis in May and 11.2% in value year over year on an unadjusted basis during the first five months of 2021.
  • Prescription drug spending will likely grow by 4% to 6% in 2021, according to the American Society of Health-System Pharmacists. The Society attributed most of the growth to increased utilization, and said that a large pipeline of expensive new drugs, including cancer treatments and specialty medications, could drive costs higher in the future.
  • Pandemic-induced changes in retail pharmacy working conditions have led to growing concerns from many state boards of pharmacy about prescription errors, according to the National Association of Boards of Pharmacy (NABP), a nonprofit that represents state pharmacy regulators. New duties including Covid-19 testing, deep cleaning, and vaccinations leave less time to focus on the safety and health of patients. "Pharmacists are being asked to do additional tasks and aren't necessarily receiving the assistance that they need from their employer," said Al Carter, executive director of the NABP. "That's a huge concern for pharmacists' well-being but also, more importantly, for patient safety."
  • The city of Seattle, WA, and several city and county governments across California have passed mandates requiring some large grocery, food retail, and pharmacy employers to provide hazard pay for frontline workers. The US Congress has not passed any government-funded hazard pay for frontline workers during the pandemic. While a few states have allocated federal CARES Act funding for hazard pay programs, experts say that it is unlikely that the programs will continue or expand without additional federal funding. There are also no national or state laws requiring employers other than the federal government to provide hazard pay to workers during a public health emergency.
  • The US Department of Health and Human Services authorized licensed pharmacists to order and administer FDA-approved coronavirus tests, including serology tests.

May 26, 2021

  • The impact of the coronavirus outbreak on dry cleaning and laundry firms is likely to vary based on each firm’s customer base. Firms heavily dependent upon cleaning business attire likely have been negatively impacted due to work-from-home measures. Firms deriving significant revenue from business-to-business sales may see revenue rise as clients intensify their cleaning efforts to minimize the possibility of infection. One in six dry cleaners in the US have closed or gone bankrupt, and industry sales are about half of what they were prior to the pandemic, according to the National Cleaners Association (NCA). More than 90% of dry cleaner owners are not taking a paycheck, and about 90% are paying employees out of their savings, according to the NCA.
  • Vaccine distribution gives dry cleaners hope that business will improve as more white-collar workers return to the office. However, the shift to work-from-home is expected to outlast the pandemic. Prior to the pandemic, about 5% of workdays were supplied from workers’ homes, and once the pandemic ends 20% of workdays will be spent at home, according to a study by researchers at the Becker Friedman Institute for Economics at the University of Chicago. The primary reasons for the shift include better-than-expected work from home (WFH) outcomes, investments in human and physical capital that support WFH, greatly reduced stigma associated with WFH, lingering concerns about coronavirus infection, and technical innovations that enable WFH.
  • Nearly 85% of dry cleaning customers say it’s extremely important to feel safe about a dry cleaning establishment’s sanitation practices, according to the recent Cleaner’s Supply Dry Cleaning Consumer Pulse Report. Customers want to know dry cleaners are wiping down surfaces including door handles, counters, and credit card systems and offer contactless drop-off and pick-up. In an earlier Cleaner’s Supply survey, more than 70% of customers said they want touchless payment methods. Half reported they were working from home; half also said they were not wearing nice clothing – neither of which are encouraging for dry cleaners.
  • While services like wash-dry-fold and free pick-up and delivery aren’t new, more customers are finding them helpful as they spend more time at home, according to American Drycleaner. Some cleaners are revamping their websites’ search engine optimization (SEO) strategies and placing online ads to boost their ranking in search engines and keep customers informed about service offerings.
  • Dry cleaners that have seen business drop off during the pandemic may seek relief via the reauthorization of the Paycheck Protection Program (PPP). The PPP was revived with the December passage of the $900 billion COVID-19 Economic Stimulus Relief Act. The legislation includes $300 billion in funding for Small Business Administration (SBA) loans. The most recent round of PPP lets eligible borrowers get a second draw loan. It also simplifies loan forgiveness for loans under $150,000 and makes forgiven loans tax deductible. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act which included an additional $7.25 billion for PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • In the most recent American Laundry News Your Views survey, 80% of laundry owners said they made operational changes in response to COVID-19. Of about 20% of laundry managers who didn’t make changes, 60% said it was due to an existing emphasis on cleanliness prior to the pandemic. Key steps managers took included employee temperature checks, increasing wash temperatures, and daily electrostatic spraying. More than 70% of laundry managers say their changes in cleaning protocol will stay in place even after the pandemic.
  • Some fashion industry insiders report an uptick in store traffic and consumer interest in updated wardrobes as vaccine distribution has surpassed initial expectations. The CEO of Gap Inc. said she expects consumers to embrace “peacocking” – showing off new looks amid warmer weather and a broader reopening of the economy. Some retailers have reported increased consumer interest in dressier clothing as more people prepare for returns to the office and travel. More than half of US consumers plan to purchase apparel in the coming months, according to market research firm NPD Group. Industry watchers suggest consumer demand for fresh apparel looks has been pent-up during the pandemic. The recent round of $1,400 stimulus checks is also projected to help drive apparel spending. Increased spending on nice clothing could be a bellwether for improved dry-cleaning demand.
  • The office space market is beginning to show signs of recovery, which could help revive demand for dry cleaning services. US demand for office space in March 2021 was just 29% lower than it was for the same month prior to the pandemic, according to real estate software firm VTS. In January 2021, office space demand was down 60% year-over-year. VTS, which offers management software to commercial landlords, gathers data by comparing office space toured by prospective tenants against the total amount of space its software covers. After dropping 85% at the onset of the pandemic, VTS’s latest report suggests office demand is only 9% below overall precrisis levels. Prospective tenants who postponed leasing space during the height of the pandemic are returning to the market. Lessees are also looking for good deals amid a tenants’ market. While VTS believes leasing activity will pick up over the next two quarters, full recovery might not come until late 2023 or early 2024.

July 7, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Construction workers are five times more likely to be hospitalized with COVID-19 than their peers in other professions, according to a University of Texas at Austin study. Lauren Ancel Meyers, one of the study authors, said that the findings don’t necessarily mean construction work needs to stop. “It means we need to go to great lengths to ensure the health and safety of workers when they do go to work.”
  • Employment in the specialty trade contracting industry increased 2.8% year over year in June but was down 2.1% compared to June 2019.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.

July 4, 2021

  • California will cover back rent and utility payments for people who fell behind during the pandemic with funding from a $7.2 billion plan that Governor Gavin Newsom called the “largest and most comprehensive renter protection deal in the United States.” All unpaid rent and utility bills for qualifying renters from April 2020 through September 30 of this year will be paid by the state. No one knows exactly how many people will qualify and how much it will cost. About $5.2 billion in federal aid previously allocated to the state is expected to be used in the endeavor.
  • Debt owed to US utilities increased 42% from December 2019 through March 2021 to a total of $19.7 billion, according to the National Energy Assistance Directors’ Association.
  • Monthly home electricity usage increased an average of 22% year over year beginning in March 2020, according to data analytics firm Sense. Mid-day energy usage was the biggest factor in driving up energy demand. Home energy usage typically drops in the middle of the day between 10 am and 4 pm, when many people are away from home for work or school. That changed soon after state emergencies were announced in March 2020 but well before state stay-at-home orders were issued. The average home showed steadily rising energy usage starting at 5 am and peaking at 4 pm, followed by decreasing use through the evening and overnight.
  • Legislation introduced in the US Congress would provide $10 billion in utility debt relief for Americans struggling during the COVID-19 pandemic. The Energy Debt Relief for American Families Act would provide funding to states through the Low-Income Home Energy Assistance Program (LIHEAP) to pay down utility bills in arrears. The National Energy Assistance Directors’ Association estimates that 15% to 20% of residential customers are at least 60 days behind on their electric and natural gas bills. The sponsors of the legislation say that it would stop utility companies from being forced to either push the cost of “bad debt” to the rest of their customer base in the form of higher rates or impose cutbacks on assistance to struggling customers.
  • State regulators will allow Georgia Power to eventually recoup the cost of personal protective gear, extra cleaning services, overtime, and meals for the company’s frontline essential workers. The costs will be recouped from customers. Georgia Power will also be allowed to add the value of bills that go unpaid due to the pandemic into rates to be collected from customers. The added costs from bad debt and the coronavirus expenses will be factored in the next time Georgia Power reviews its rates with the state Public Service Commission in 2022.
  • At least 35 states either have granted utility requests for “accounting orders” or are poised to do so, according to Utility Dive. Accounting orders allow utilities to record on their books an offset known as a “regulatory asset,” which is a shareholder asset entirely backed by regulations that allow utilities operating as monopolies to recoup losses through surcharges at a later date that would not be possible in a competitive market. The accounting orders consist primarily of the rising “bad debt” associated with unemployed customers who cannot pay their bills, according to Utility Dive. These regulatory assets earn a return at an amount calculated by the regulator. In Wisconsin, for example, utilities have asked that their regulatory asset accounts grow at between a 7.22% and 7.77% annual return. A Wisconsin utility that couldn't collect $100 million from its customers during the pandemic ultimately would be able to collect $115 million in two years.

July 7, 2021

  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Electrical contractors are benefiting from pandemic-driven demand growth for data and services accessed via the Internet. Capital expenditures on hyperscale data centers by the 20 largest cloud and internet service companies in the world hit a record-breaking $37 billion in Q3 2020, according to Synergy Research Group. Data center spending by these companies from January 2020 to September 2020 totaled $99 billion, up 16% year over year. More than 100 new hyperscale data center facilities were built during 2020, taking the total number to almost 600. Synergy Group analysts cite new, pandemic-driven business models that emphasize cloud-based computer services as a key driver of increasing spending on hyperscale data centers.
  • Wind and solar power facility installations increased 61% year over year in 2020, according to BloombergNEF and Business Council for Sustainable Energy. About 34 gigawatts was added to the grid in 2020, nearly 50% more than the previous record, set in 2016. Electrical contractors are likely to have benefited and are likely to benefit from the extension through 2022 of a federal solar tax credit that was set to expire in 2020.
  • Construction industry experts expect a surge in commercial renovations in 2021 due to tax changes included in the 2020 CARES Act. Facility upgrades qualified for tax deductions before the passage of the CARES Act, but to reap the full benefits, facility managers had to claim a 2.5% write-off each year for up to 39 years. With the passing of the 2020 CARES Act, facility managers can write off 100% of qualifying facility improvement costs in the first year. A few improvements that qualify for the tax deduction are the installation of airflow management accessories, HVAC devices, and physical security and access control solutions.
  • Attorneys at Atlanta-based law firm Fisher Phillips told contractors that it is within their legal rights to compel workers to get vaccinated against COVID-19. Requiring construction workers to get a coronavirus vaccination is comparable to existing rules for healthcare workers that make flu shots mandatory in order to protect all patients and staff and keep the workplace safe, the attorneys said. The attorneys also recommended that contractors set up programs to administer vaccines on jobsites, during work hours, and free of charge, in order to get the highest participation possible while ensuring projects continue to move forward.
  • Employment in the specialty trade contracting industry increased 2.5% year over year in June but was down 2.1% compared to June 2019.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.

July 12, 2021

  • US electrical equipment distributors may face higher costs for and increasing shortages of imported electrical equipment due to a wave of Covid-19 clusters in Asia that is creating new bottlenecks in the global supply chain, according to The Wall Street Journal. Increasing competition for space on container vessels that ship goods around the world has sent freight rates soaring. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries, and increasing numbers of new COVID-19 cases in those areas may trigger re-implementation of social distancing measures that slow the movement of goods. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit.
  • US Commerce Secretary Gina Raimondo said that she is looking for ways to help auto makers amid a pandemic-related global semiconductor shortage but won’t give priority to them over other chip users. Electrical equipment manufacturers that use semiconductor chips in their products are likely benefit from assurances of equal access to additional semiconductor chip supplies resulting from efforts to increase domestic semiconductor production, and those benefits are likely to accrue to electrical equipment distributors as well.
  • Capital expenditures on hyperscale data centers by the 20 largest cloud and internet service companies in the world hit a record-breaking $37 billion in Q3 2020, according to Synergy Research Group. Data center spending by these companies from January 2020 to September 2020 totaled $99 billion, up 16% year over year. More than 100 new hyperscale data center facilities were built during 2020, taking the total number to almost 600. Synergy Group analysts cite new, pandemic-driven business models that emphasize cloud-based computer services as a key driver of increasing spending on hyperscale data centers.
  • Construction industry experts expect a surge in commercial renovations in 2021 due to tax changes included in the 2020 CARES Act. Facility upgrades qualified for tax deductions before the passage of the CARES Act, but to reap the full benefits, facility managers would have to claim a 2.5% write-off each year for up to 39 years. With the passing of the 2020 CARES Act, facility managers can write off 100% of qualifying facility improvement costs in the first year. A few improvements that qualify for the tax deduction are the installation of airflow management accessories, HVAC devices, and physical security and access control solutions.
  • Dodge Data & Analytics predicts 4% growth in total construction starts for 2021. Total residential starts are expected to rise 5%. Nonresidential construction is expected to decrease 9.3%.
  • Total construction spending increased 0.2% month over month on an adjusted basis and 9% year over year on an unadjusted basis in April, according to the US Census Bureau. Residential construction spending increased 1% month over month and 27% year over year in April. Nonresidential construction spending decreased 0.5% month over month and 4% year over year in April.
  • Electrical equipment distributor industry employment increased 2.1% year over year in May but was down 5.4% from the pre-pandemic month of May 2019.
  • Demand for electrical equipment is tied to commercial construction. The US Chamber of Commerce’s Commercial Construction Index (CCI) increased to 65 in Q2 from 62 in Q1. The Index score was 74 for Q1 2020, which at the time was in the midrange of scores since the Index began in 2017. Concern about steel and aluminum tariffs jumped 10 points from the previous quarter, and product shortages continue to plague the industry. About 72% of contractors continue to experience project delays from COVID 19, but they expect it to impact only 11% of their projects within three months.

June 26, 2021

  • The Small Business Administration (SBA) hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • Electrical equipment manufactures may not be able to maintain adequate supplies of components that require semiconductor chips. One specific bottleneck is a type of semiconductor called microcontrollers, very small computers—that are used for things such as engine control systems, according to New Street Research analyst Pierre Ferragu. The semiconductor shortage is likely to be particularly disruptive firms supplying auto manufacturers because the production of vehicles relies on dozens of computer chips for electronic components that control engines, transmissions, entertainment systems, brakes and other systems. Both General Motors and Ford have estimated that the shortage will lower their operating profit by at least $1 billion this year.
  • Total US energy consumption, a driver of demand for electrical equipment, is expected to increase 2.6% in 2021 and 2.5% in 2022, according to the US Energy Information Administration.
  • Employment in the electrical equipment manufacturing industry decreased 5.5% year over year in April.
  • Electrical equipment manufacturers, particularly those that need rare earth magnets to make motors and generators, may benefit from attempts to reduce US reliance on rare earths imports from China. Rare earth metals are used in the production of high-tech goods, including smartphones, electric vehicles, and modern defense systems. The RARE Act introduced in the US Congress in September 2020 would provide tax incentives through deductions on property used for the mining and on the purchase of materials extracted within the United States. It would also create a $50 million yearly grant program through the Secretary of the Interior through the next four fiscal years. China produces over 85% of the world’s rare earth materials, and most US imports of them come from China, according to the Center for Strategic and International Studies (CSIS).
  • US production of electrical equipment increased 7.2% year over year from the pandemic-related low posted in May 2020, but was down 10.1% from the pre-pandemic month of May 2019.
  • Electrical utility industry revenue is expected to be flat in 2021 before rising 7.8% in 2022. With electrical utilities suffering losses, demand for equipment is likely to stall.
  • Imports of electrical equipment increased 13.7% year over year in the first four months of 2021 while exports increased 4.8%.

July 17, 2021

  • US electronic component manufacturers may benefit from a wave of Covid-19 clusters in Asia that is creating new bottlenecks in the global supply chain. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries, according to The Wall Street Journal. Thailand has been battered over the past two months by its worst ever surge of new cases, while Vietnam has also suffered. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit.
  • Federal lawmakers are developing a $52 billion proposal to boost US semiconductor chip production and research, according to Reuters news service. Electronic component manufacturers are likely to benefit from expansion of the industry in the US. The draft is said to include $39 billion in production and R&D incentives and $10.5 billion to develop the National Semiconductor Technology Center, National Advanced Packaging Manufacturing Program, and other R&D programs. The proposal is expected to be included in a larger legislative proposal to spend more than $110 billion on basic US and advanced technology research to better compete with China.
  • Industry experts say that components which were previously on 16-week lead times are now on 32 weeks due to pandemic-related supply chain issues, and some semiconductor manufacturers are asking for orders to be placed two years in advance.
  • The pandemic has executives in industries including electronic component manufacturing re-thinking their supply chains. Manufacturers surveyed in early 2021 by IHS Markit said that the "stretching of supply chains" over the last year has extended delivery times to levels "unsurpassed in over 20 years of data availability." More emphasis on flexibility and less on cost reduction will be vital for company profits going forward.
  • Rising prices for copper and other metals and potential shortages of multilayer ceramic capacitors, power MOSFETs and other components are some of the supply chain challenges that electronic components manufacturers say they will face in 2021, according to Electronics Sourcing magazine. Another issue of growing concern is supplier consolidation. “When this happens, we often see that product availability is impacted due to rationalization of products, which in effect leads to end-of-life of redundant or similar products,” said Shabnam Shaghafi, vice president of supply chain for EMS provider Benchmark Electronics. Consolidation-driven product rationalization may force the redesign of electronic components ahead of schedule.
  • Several industry analysts expect new auto sales to increase about 6.9% in 2021. The National Automobile Dealers Association expects 2021 sales of 15.5 million. Forecasters at car-shopping web site Edmunds also predicted 2021 sales of 15.5 million. Charlie Chesbrough, senior economist for Cox Automotive, said that Cox expects 2021 sales of 15.7 million. US auto sales in 2020 were 14.5 million, down 15% from 2019. It was the fourth-largest annual decline since at least 1980.
  • Auto manufacturers are cutting or stopping production due to shortages of critical microprocessors and other computer chips. The problem is exacerbated by the rebound from the Covid-19 pandemic that led to lengthy factory closures last spring, said Kristin Dziczek, a senior industry analyst with the Center for Automotive Research. Manufacturers have ramped up production to respond to inventory shortages, putting them into competition for chips with a consumer electronics industry facing its own surge in demand.
  • The United States must find a path to domestic sources for the important microelectronics that are used in defense weapons systems, according to US Department of Defense (DOD) Under Secretary of Defense for Acquisition and Sustainment Ellen M. Lord. "While we still design components, [field-programmable gate arrays], [application-specific integrated circuits], and printed circuit cards in the US, the majority of fabrication, packaging, testing etc., is done offshore," Lord said. "We can no longer clearly identify the pedigree of our microelectronics. Therefore, we can no longer ensure that backdoors, malicious code or data exfiltration commands aren't embedded in our code."
  • Employment in the electronic component manufacturing industry was unchanged year over year in May but was down 2.3% from the pre-pandemic month of May 2019.
  • Multinational banking and financial services corporation ING doesn't expect major changes in the length or location of global value chains in direct response to Covid-19. The coronavirus outbreak has led to many calls for more resilient production chains, but in the industries that ING studied, the sheer number of suppliers and their concentration in specific regions present major obstacles to diversifying risks. Specialization in electronics value chains makes it difficult for firms to diversify their suppliers across countries to increase supply chain resilience. ING cites South Korea, the major exporter of memory chips, as a prime example. Although some other countries produce memory chips, quantities are not sufficient to meet global demand in the event of a shock affecting the supply of South Korean producers.

June 22, 2021

  • Retail sales for the electronics and appliance store industry decreased 3.4% in value month over month on an adjusted basis in May but increased 21.1% in value year over year on an unadjusted basis during the first five months of 2021. Sales had increased 10.5% in value month over month on an adjusted basis and 29.4% in value year over year on an unadjusted basis in March.
  • A plan by E-commerce giant Amazon to open electronics and appliance stores was suspended after a pandemic-driven surge in spending forced the company to prioritize the handling of day-to-day demand and the launch of its Fresh grocery store, according to Bloomberg News. An anonymous source told Bloomberg that the idea for a consumer electronics and home goods store was "a way to be able to clean out warehouses, and get through inventory without having to destroy it." Analysts note that Amazon has launched similar bricks-and-mortar stores in the past, and may revisit the idea post-pandemic.
  • A significant number of appliance categories are on a 90- to 120-day back order due to component shortages and social distancing in factories, according to industry veterans. There are severe component shortages for dishwashers and refrigerators, and material shortages such as rolled steel. Many customers are deciding that getting a brand name item is much less important than getting an item that is currently in stock.
  • Best Buy is expanding its test of a new store format that reduces the space for customers to browse by nearly half. The electronics retailer’s experiment shows how retailers are adapting their business models to cope with the sharp uptick in e-commerce during the pandemic. The new format, first tested in late 2020 at four locations near Best Buy’s Minneapolis headquarters, provides additional space to prepare digital orders for pickup or delivery from the store. Some of the additional floor space in a few locations could be devoted to the retailer’s Geek Squad service desk.
  • Research firm Moody's Analytics says that retailers can expect increasingly favorable operating conditions in 2021 as the economy gradually rebounds from the effects of the Covid-19 pandemic. “Our current 2021 forecast is for 6.2% growth in core retail sales,” said Scott Hoyt, senior director of consumer economics for Moody’s Analytics.
  • Employment in the electronics and appliance store industry increased 18.7% from the pandemic-related low of May 2020 but was down 12.4% from  the pre-pandemic month of May 2019.

May 26, 2021

  • On May 24, the 7-day average for new cases was just over 25,000 – about one-tenth the number seen during the peak in early January. Hospitalizations and deaths have also fallen significantly. As of May 24, 285 million doses of vaccine had been administered and 39% of the US population was fully vaccinated. Demand for employment services may rise if infections continue to slow and more parts of the economy rebound. The American Staffing Association’s Staffing Index was up 57.4% over the four weeks ending May 9, 2021 compared to a year earlier. However, a year earlier much of the economy was under lockdown.
  • As of May 7, 2021, job postings on Indeed were 23.4% higher than they were on February 1, 2020 – Indeed’s pre-pandemic baseline. Many sectors are experiencing a major boom in job postings, including production & manufacturing (+71), loading & stocking (+69.4%), construction (+59.7), pharmacy (+56.5). Sports, and hospitality & tourism continue to struggle; the sectors were down 6.4% and 8%, respectively. Sectors performing close to the average for all US postings included retail (+27.5%), software development (+26.7), arts & entertainment (+21.4), and food preparation & service (+19.7%).
  • The US economy added 266,000 jobs in April 2021, according to the Bureau of Labor Statistics and the unemployment rate rose slightly to 6.1% compared to March. New jobless claims were 444,000 the week ending May 15. Job growth in April was disappointing; some economists were expecting as many as a million new jobs. However, the mid-May drop in new unemployment insurance claims suggests the labor market is gaining steam.
  • US average shift work volume rose 0.5% in April compared to the prior month, according to data compiled by HR solutions firm Ultimate Kronos Group (UKG). April’s growth was relatively flat despite rising vaccination rates and relaxing of restrictions in many areas. Shift work growth was led by the public sector (+7.4%), and services and distribution (+0.8%). Healthcare experienced the biggest drop with shiftwork off 1.8%, followed by manufacturing (-1.2%), and retail, hospitality, and food service (-1.2%). The UKG Workforce Recovery Scale was 85.9 in April, up 0.4 points from 85.5 in March. The UKG Workforce Recovery Scale in April 2020 hit a low of 66.8.
  • Glassdoor developed a dedicated COVID-19 job search hub and a hiring surge explorer, so job seekers can filter and see industries and cities where hiring is strong. Job seekers can also filter listings for work-at-home jobs. Working from home was born out of necessity for many companies at the onset of the pandemic. As some types of jobs become less tethered to physical workplaces, employment services may have to adapt to locating the best candidates regardless of where they live. Prior to the pandemic, about 5% of workdays were supplied from workers’ homes, and once the pandemic ends 20% of workdays will be spent at home, according to a study by researchers at the Becker Friedman Institute for Economics at the University of Chicago.
  • The US jobs market continues to improve, according to the latest quarterly Business Conditions Survey conducted by the National Association for Business Economics (NABE) and released in April. The survey showed that 20% of NABE member respondents said they planned to increase employment, which was down from the 30% who said they planned to increase employment in the previous quarter’s survey. The number of survey participants who said they planned to decrease employment rose to 11% from 10% during the same period. However, respondents from all industrial sectors said their companies anticipated adding workers in the next three months.
  • Temporary staffing revenue rose by a median 21% in April 2021 compared to a year earlier, according to Staffing Industry Analysts (SIA). However, much of the growth was due to the low baseline of April 2020 when much of the country was under stay-at-home orders. Travel nurse staffing revenue saw the largest gain in April, rising a median 85% year over year. Other areas of growth included industrial with median growth of 26%, legal (+18%), and office/clerical (+17%). While temporary staffing revenue continued to grow in April, nearly half of the firms surveyed reported that some candidates were not showing up for interviews or assignments, or had ended assignments early.
  • Despite a resurging economy, rising vaccination rates, and easing pandemic-related restrictions, some employers are having a hard time hiring enough workers, according to The Wall Street Journal. As more of the economy opens, industries including retail, restaurants, manufacturing, and construction are eager to hire, but in April the US economy only added 266,000 jobs when economists expected nearly four times that many. Workers may be waiting on the sidelines for several reasons, including fear of contracting or spreading COVID-19. While many businesses are reopening, many schools remained closed which can make it difficult for parents of young children to return to work. Some workers may be receiving more in unemployment benefits than they would working available jobs. Others lack the skills necessary to pivot to a new career. Some economists suggest more jobs will be filled starting in the fall when federal supplemental unemployment insurance benefits are set to expire and many schools reopen to in-person learning.

July 4 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • The United States today is producing roughly the same amount of goods and services as before the coronavirus pandemic, but with 8.2 million fewer workers, according to The Washington Post. Analysts cite increasing use of automation for the development. Analysts also note that many companies are struggling to attract enough workers to meet surging demand, and engineering services are likely to benefit if the problem results in even greater reliance on automation.
  • Orders for robots in North America, mostly the US, increased 20% year over year in Q1 and were up 16% compared to the same period in 2019, according to the Association for Advancing Automation. The Pennsylvania Turnpike eliminated toll collection by hand and switched to a cashless electronic system. Procter & Gamble, maker of detergents, diapers, toilet paper and a cornucopia of other household goods, found that strategically adding robots to its assembly lines made it possible to keep more workers on the job and produce more goods while complying with social distancing guidelines.
  • Engineering services are playing a major role in the pandemic-driven attempt to increase rural broadband access. Typical steps for bringing broadband to a community that require the participation of engineering services include conducting feasibility studies and determining return on investment (ROI), preparation of funding applications based on feasibility studies and ROI, creating and finalizing deployment plans after funding is approved, and overseeing broadband system deployment.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Engineering industry employment increased 5.6% year over year in May, according to the US Bureau of Labor Statistics.

June 16, 2021

  • As the pace of reopening has varied by state, some environmental consulting firms that operate across state lines face a patchwork of state-level regulations which can change suddenly. Industry insiders recommend field consultants work very closely with their firm’s general counsel office to ensure they are in compliance with the state regulations where they are operating.
  • The $1.9 trillion America Rescue Plan Act signed by President Biden in March includes $100 million in funding for grants and other activities aimed at reducing environmental health risks in minority and low-income communities. A growing list of studies suggest that areas with high levels of air pollution can experience higher deaths from COVID-19 or experience more severe outbreaks. The funding will be administered by the Environmental Protection Agency (EPA).
  • As businesses, schools, universities, and other public indoor spaces reopen, it may create opportunities for consulting firms with expertise in maintaining indoor environmental quality. Facilities may seek consulting expertise to ensure proper sanitization and ventilation. Consultants can offer third-party assessments and inspections for cleaning and disinfection policies and procedures, HVAC ventilation evaluations, air and surface testing for pathogens, and indoor environmental safety training.
  • Prior to the pandemic, government and consumer pressure was building to regulate single-use plastic products and their impact on the environment, especially oceans. The spread of COVID-19 greatly increased waste from single-use products, including masks, plastic gloves, and food containers. The impact of this increase in waste may prompt companies, industries, and governments to perform life-cycle assessment (LCA) studies to determine product development initiatives and government regulations. However, critics of the LCA process argue the studies can often be skewed to further a corporate or government agenda. The need for improved public perception and transparency could drive demand for environmental consultancies to perform independent LCAs and/or provide peer review services for LCAs produced by corporations and governments.
  • The pandemic is expected to hasten the adoption of remote sensors and other digital tools that can help environmental consultants monitor conditions in the field. Restrictions on travel and social distancing requirements challenged some firms’ ability to perform environmental field work and maintain optimal levels of regulatory compliance. Advanced sensors - monitored via cloud-based mobile aps - can make compliance faster, less costly, and more efficient.
  • Some large consulting firms are seeing less demand for corporate restructuring advice as economic conditions have improved compared to earlier in the pandemic, according to The Wall Street Journal. Consultancies are helping clients focus on other areas, including environmental, social, and corporate governance (ESG) issues. Many restructuring firms and investment banks believe corporate restructurings will continue to taper off in 2021 compared to 2020, but will still be high compared to pre-pandemic levels.
  • The COVID-19 pandemic has increased consumer concerns about sustainability, according to a recent survey of 14,000 consumers in nine countries by the IBM Institute for Business Value (IBV). Nine in 10 respondents said the pandemic had affected their views on environmental sustainability, more so than other types of disasters, including severe weather and wildfires. More than two-thirds of consumers felt corporations would face increased public scrutiny regarding corporate environmental policies over the next year. Nearly 55% of those surveyed said they would be willing to pay more for brands that are sustainable and/or environmentally responsible. Heightened consumer awareness of sustainability issues might increase demand for consultants who can help firms develop and implement sustainability goals.
  • The global environmental consulting market proved resilient during the pandemic, according to trade group Environmental Analyst’s (EA) latest Global Environmental Consulting Strategies & Market Assessment report. The EA report’s market estimates are based on the performance of the top 25 environmental firms the “Global 25.” The pandemic held the environmental sustainability consulting market to $38 billion in 2020, or about 0.6% growth over the prior year. That followed annual growth of between 5% and 6.5% between 2017 and 2019. However, EA expects demand to rebound strongly amid rising global demand for net-zero carbon initiatives, and more businesses adopt environmental, sustainability, and governance (ESG) goals. The EA report expects the global environmental consulting market to rise 5.3% in 2021, and generate an additional $9 billion in revenue over the next four years. North America is the largest environmental consulting market at 46%, followed by Europe (24%), and Asia Pacific (22%). Top project types include water and waste management (29% of Global 25 revenue), contaminated site assessment and remediation (25%), and impact assessment (20%).

July 13, 2021

  • Commercial bankruptcy filings increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021. The number of bankruptcies per month has been volatile in 2021. Just 27 new corporate bankruptcy cases were filed in May. Some experts continue to question whether government support and easy access to capital will keep distressed companies out of court or if another bankruptcy spike will soon come, according to S&P Global Market Intelligence. "You can't kick the can down the road forever," said Robert Hirsh, a partner in Lowenstein Sandler LLP's bankruptcy and restructuring department.
  • A larger share of distressed companies upended by the COVID-19 pandemic is using court processes to restructure instead of close, according to S&P Global Market Intelligence. Nearly 62% of corporate bankruptcy filings in 2020 sought reorganizations, the highest rate for any year going back to at least 2010. Companies were less likely to liquidate in 2020, a departure from 2019 and 2018 when corporate liquidations outpaced reorganizations in bankruptcy filings. As of March 30, the share of filings seeking restructuring is larger in 2021 than in 2020. S&P analysts note that government stimulus and easy access to capital have kept at-risk companies from entering bankruptcy following a jump in filings during the early months of the pandemic in in 2020, but bankruptcies are likely to pick up again later in 2021 as companies confront the aftershocks of the pandemic.
  • Industry employment increased 6% year over year in May but was down 2.3% compared to the pre-pandemic month of May 2019.
  • The prices that commercial machinery repair and maintenance services charge increased 3.1% year over year in May.
  • Capacity utilization for the manufacturing sector as a whole, an indicator of demand for equipment and machinery repair, increased from a low of 60.4% in April 2020 to 75.6% in May 2021, passing the 75% level achieved in 2019. Total capacity utilization, including factories, mines and utilities, increased to 75.2% in May. That rate compares with 76.9% in February 2020.

July 4, 2021

  • New York University Stern School of Business became the fourth top-25 business school to continue accepting applications to its full-time MBA program without the inclusion of Graduate Record Exam or Graduate Management Admission Test scores, if conditions created by the ongoing coronavirus pandemic prevent applicants from taking one of the exams.
  • Dallas Independent School District Dallas ISD plans to hire 1,8oo tutors as part of a program to provide consistent academic help to students during the school day. District officials expect to use federal coronavirus relief funding to cover the cost, budgeted to be about $12 million for tutoring over three years. The bigger challenge, officials say, will be finding the personnel to execute the district’s vision.
  • US Education Secretary Miguel Cardona said in early May that he expects all schools to be open full-time in person for all students in the fall. Demand for tutoring services may revert to pre-pandemic levels if the expectation is met.
  • About 43% of tutors surveyed by online tutoring platform Wyzant said that the pandemic was causing learning loss among their students, and nearly one-third of respondents said they believe that some of their students will never catch back up. About 78% said that their students who are studying remotely need the most help.
  • Heightened demand for tutors of certain subjects indicates where students may be struggling most with the remote learning format, according to a survey conducted by online tutoring platform Wyzant. STEM subjects account for many of the increases in Wyzant’s business in 2020, including a more-than 100% hike in demand for organic chemistry tutors and an approximately 600% increase in demand for help with macroeconomics.
  • Students continue to take exams like the SAT and ACT despite the fact that more many colleges stopped requiring them for admissions. Education experts say that demand for the test is being sustained by their use in determining the winners of academic scholarships. Colleges and universities including Loyola University Chicago, Clemson University, and the University of Oklahoma, have made scores optional for admission but continue to require test results for their most prestigious merit scholarships. Students who are among the top PSAT scorers could earn $68,500 from the University of Oklahoma, which would cover full tuition for an in-state student. Some state-run scholarship programs, including in Idaho and Florida, also continue to require students to have an SAT or ACT score to be considered.
  • The Brookings Institution found that more than four-fifths of the tutoring programs that were examined since the pandemic started resulted in "statistically significant" improvements for the students involved.
  • Some school districts have announced that employees who try to lead tutoring pods while keeping their regular teaching jobs may be fired. “As a reminder…[Arlington Public Schools] teachers are not permitted to take on additional positions such as tutoring or learning supervision during the school day,” officials in the Northern Virginia district wrote in a recent message to staff. “Nor are they allowed to tutor students they work with…outside of the classroom for pay.” Some school leaders contacted by The Washington Post said they could not estimate the number of pod leaders in their ranks. Industry experts say that data on how many teachers are leading pods is difficult to gather because many educators are hiding their activities from school districts.
  • Over 1,450 colleges and universities have dropped standardized testing requirements for fall 2021, according to the National Association for College Admission Counseling. Some institutions are entirely abandoning the SAT and ACT as a requirement for applicants. Many industry experts say that, in a year when most seniors can’t take the test, some students believe that a score will tip the scales for them. Experts also note that schools that have chosen "test optional" policies have created confusion among students and families about the role that scores play in the admission process. Test-optional means that students may submit standardized test scores on their application, but they are not required to. Going test-optional doesn’t mean that a college won’t look at scores.
  • The private tutoring market, which includes Chegg, Club Z, and Varsity Tutors, is projected to grow in the US by $7.37 billion by 2023, at a compound annual growth rate of almost 8%, according to Technavio. Varsity Tutors, a live learning platform connects students with tutors, who work as independent contractors, "... is experiencing unprecedented demand, as students — especially [those in] kindergarten through fifth grade, who have historically been less receptive toward online learning — work to stay on track during closures,” according to Chief Academic Officer Brian Galvin.

July 21, 2021

  • New vehicle sales, an indicator of demand for some types of fabric, increased 50.2% year over year during Q2 but were down 0.4% compared to the same period in 2019. Analysts say that a semiconductor chip shortage which is limiting auto production will start to ease in Q3, but won’t be gone completely until 2022.
  • Many US manufacturers fear that their reshoring achievements may be washed away as the local economy and global supply chains rebound following the coronavirus pandemic. The newly-formed American Mask Manufacturers Association (AMMA), for example, has therefore requested more help from the federal government. The group says that China is now dumping masks and respirators on the US. Chinese surgical masks now sell for as little as a penny apiece in the US despite raw materials costing at least three times that price, according to the AMMA. It predicts that half its collective production capacity will be lost without federal intervention, such as mandates requiring that federal personal protective equipment (PPE) funding goes to US-made masks, or reversal of Food and Drug Administration emergency authorizations of some overseas PPE.
  • Demand for antiviral fabrics may decline now that the Centers for Disease Control and Prevention (CDC) has acknowledged that the risk of catching the coronavirus from surfaces is low. Researchers reported early during the pandemic that the virus could survive for days on plastic or stainless steel, and the CDC advised that if someone touched one of these contaminated surfaces and then touched their eyes, nose or mouth, they could become infected. Health experts say that revised CDC guidance reflects evolving data on transmission throughout the pandemic.
  • Scientists are developing antiviral fabrics that target the coronavirus through a variety of approaches. Intelligent Fabric Technologies North America, a Canadian biotech company, has developed a chemical that can be coated onto fabric. The chemical enters the outer shell of the novel coronavirus, disrupting its ability to replicate. Swiss textile company HeiQ has also developed a fabric coating, ViroFormula, which may deactivate and block the replication of coronaviruses. University researchers are working on materials meant to kill the virus through low-level electric fields and UV light. Industry experts say that it’s unclear how much these fabrics, even if they do kill the novel coronavirus, will actually reduce wearers’ risk of contracting COVID-19. They note, however that the strong demand potential has caused product developers to partner with popular apparel brands like North Face, which plan to apply the treatments to their products.
  • The Centers for Disease Control and Prevention has said that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Fabric mills supplying nonwoven fabric to manufacturers of cleaning wipes may be negatively impacted if demand for the wipes decreases. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • Several industry analysts expect new auto sales to increase about 6.9% in 2021. Fabrics are used in the manufacture of auto seating and auto floor coverings. The National Automobile Dealers Association expects 2021 sales of 15.5 million. Forecasters at car-shopping web site Edmunds also predicted 2021 sales of 15.5 million. Charlie Chesbrough, senior economist for Cox Automotive, said that Cox expects 2021 sales of 15.7 million. US auto sales in 2020 were 14.5 million, down 15% from 2019. It was the fourth-largest annual decline since at least 1980.

July 21, 2021

  • Relaxed regulations that providers have relied on during the coronavirus pandemic to expand services are being terminated as health emergencies are cancelled. Florida Governor Ron DeSantis, for example, let an executive order declaring a public-health emergency expire in late June. Many regulatory flexibilities that health-care providers received during the pandemic, including flexibilities related to telehealth, also expired. Smartphones and traditional phones are no longer an acceptable platform for delivering telehealth services to non-Medicare patients in Florida.
  • All fifty states and DC had expanded telehealth access to family planning services for Medicaid beneficiaries. North Carolina is allowing both traditional Medicaid beneficiaries and beneficiaries of its family planning Medicaid program to receive select family planning services via telehealth. State officials have also expanded Medicaid-covered telehealth service delivery to include perinatal care, maternal support services, and postpartum depression screening. Alaska has begun allowing direct entry midwives to provide some services using telehealth. Many state Medicaid programs are waiving potential penalties for HIPAA violations for the duration of the emergency.
  • Pregnant women were less than half as likely to be fully vaccinated than non-pregnant women as of early May, according to a Centers for Disease Control and Prevention Estimate. Health experts say that vaccine hesitancy is to blame.
  • States with higher vaccination rates have significantly fewer coronavirus cases, a Washington Post analysis has found. Counties with high vaccination rates had low, decreasing coronavirus rates. Counties where few people are vaccinated had higher case rates and increasing numbers of new cases.
  • The Food and Drug Administration has temporarily stopped enforcing a rule requiring women to get the first of two pills needed to terminate an early pregnancy at a medical clinic or hospital. Both pills will be available by mail for the duration of the coronavirus pandemic.
  • A Center for Effective Philanthropy survey of nearly 240 foundations, of whom 170 signed a pledge to reduce restrictions on their giving during the pandemic, found that 92% of respondents had loosened or eliminated restrictions on current contributions, 80% were making new donations as unrestricted as possible and 90% were reducing what they ask of grantees, like reporting requirements.
  • The American Rescue Plan Act signed into law in March includes $50 million for family planning services. The funding is intended for non-profits and/or public entities, including for “services for adolescents.”
  • A spike in birth control requests may reduce the size of an expected coronavirus baby boom. Digital health clinic Nurx, which serves more than 250,000 patients, said that it's seen a 50% increase in patient requests for birth control and a 40% increase in emergency contraception requests. Industry experts say that health-related uncertainties brought on by the coronavirus pandemic may be causing people to refrain from having a child. A study published by the Centers for Disease Control and Prevention found that pregnant women may be at increased risk for severe illness from COVID-19 compared with non-pregnant women.

June 22, 2021

  • Coronavirus has disrupted the agriculture sector by affecting demand for food, food exports, and biofuels. The US food supply chain had to quickly adapt as commercial demand (restaurants and schools) disappeared and consumer demand increased. Quarantines also hurt demand for corn-derived ethanol.
  • US net cash farm income, a demand indicator for farm and garden machinery, is estimated to have risen by $27.3 billion (24.7%) to $137.8 billion in 2020 compared to 2019, according to a February 2021 USDA forecast. Net cash farm income is forecast to decline $7.9 billion (5.8%) to $128.3 billion in 2021. Net cash farm income includes cash receipts from farming as well as farm-related income, such as US government payments. Cash receipts for animals and animal products in 2021 are expected to rise $8.6 billion (5.2%), while crop receipts are projected to increase $11.8 billion (5.8%). Direct government payments are forecast to fall $21 billion to $25.3 billion, a drop of more than 45%. Farm supports are expected to decline in 2021 amid less supplemental and ad hock COVID-19 relief payments compared to 2020.
  • Various US government stimulus programs designed to aid farmers and ranchers – including provisions of the CARES Act and direct aid by the USDA – might help boost investments in farm machinery. Payments under the Coronavirus Food Assistance Program (CFAP) totaled more than $23 billion, according to the USDA. The Paycheck Protection Program (PPP) provided nearly $6 billion, according to the University of Missouri’s Food and Agriculture Policy Research Institute (FAPRI). Farmers also received assistance from Market Facilitation Program (MFP) payments. In late-December, Congress passed the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act which provides $284 billion in additional funding for PPP (although the PPP ran out of money on May 11, 2021 and stopped accepting most new applications). The bill also included $13 billion in additional direct agricultural assistance. The American Rescue Plan Act that passed in March 2020 includes more than $10 billion for programs aimed at strengthening US agriculture and the food supply chain, according to analysis by the American Farm Bureau Federation. The bill includes $3.6 billion – or 35% of total agriculture appropriations – for pandemic-related food purchase and distribution. About $4 billion – or nearly 40% of the total - will provide debt forgiveness to socially disadvantaged farmers. The Farmers to Families Food Box Program funded farmers to provided boxes of meats, dairy, and produce to families in need during the pandemic. The USDA wound down the Farmers to Families Food Box program at the end of May 2021. It has been replaced by a number of existing programs, including The Emergency Food Assistance Program (TEFAP) which provides produce, meats and dairy products which are distributed to those in need by local foodbanks and other charitable organizations.
  • Total US farm tractor sales fell 3.9% in May 2021 compared to the same month a year earlier, according to the Association of Equipment Manufacturers (AEM). Farm tractors with 100 horsepower or more saw the strongest gain with a sales increase of 28.6%. Sales of tractors between 40 and 100 horsepower were up 6.7%. Four-wheel-drive tractor sales increased 62.2% Tractors with less than 40 horsepower saw sales decrease 8.7%. Sales of self-propelled combines were up 33.2%. Weaker sales of small tractors under 40 horsepower dragged down total tractor sales despite solid growth in all other horsepower categories. The AEM noted that although small tractor sales fell on a year-over-year basis, sales for the first five months of 2020 were up 26% compared to the same period in 2020.
  • Farm and construction equipment manufacturer Deere’s worldwide sales in its production & precision ag segment rose 35% in fiscal Q2 2021 compared to the prior year. Sales in Deere’s small agriculture & turf segment were up 30%. In the US and Canada, Deere projects sales of large agricultural machinery in fiscal 2021 will be up about 25% over 2020. European demand is expected to rise about 10%. Deere forecasts its fiscal 2021 South American tractor and combine sales will be up about 20%. Revenue in Asia will be up slightly compared to fiscal 2020. Some industry watchers expect Deere’s fortunes to improve as farmers spend their COVID-19-related government payments on new machinery. Higher commodity prices and increased animal feed exports to China have also helped to boost farmers’ buying power.
  • In mid-June 2021, the USDA announced additional assistance for agricultural producers as part of the USDA’s Pandemic Assistance for Producers initiative, which was established in March. The latest move will expand CFAP payments to include timber harvesters, biofuel producers, dairy farmers and processors, livestock producers, and contract poultry growers. The program expansion also will help in cost-share initiatives for agriculture operations making the shift to organic production and extend grants for personal protective equipment (PPE). The latest round of aid aims to help farmers who were left out of or underserved by previous coronavirus-related federal aid.

July 4, 2021

  • Semiconductor manufacturer Intel's Chief Executive Officer Pat Gelsinger predicted that the shortage of semiconductors which is hurting industries from automotive to consumer electronics will peak in the second half of 2021 before starting to improve. “I don’t expect the chip industry is back to a healthy supply-demand situation until ’23,” he said in an interview. “For a variety of industries, I think it’s still getting worse before it gets better.”
  • Leading farming machinery manufacturer Caterpillar warned of potential impacts ahead due to a global semiconductor chip shortage. “Although we haven’t been impacted yet, the global semiconductor shortage may have an impact later this year,” Chief Financial Officer Andrew Bonfield said in a Thursday interview. “It’s a risk and obviously we’re keeping a close eye on it.” The warning follows first-quarter revenue and profit that topped analysts’ estimates, in what Bonfield described as “very strong performance” for the start of the year fueled by construction growth in the US and China.
  • Farmers who are flush with cash after a pandemic-driven increase in grain prices are struggling to get new equipment due to a pandemic-driven parts shortage faced by farm equipment manufacturers. Supply chain disruptions have left manufacturers short of the steel, plastics, microchips, and tires needed to make tractors and combines. Suppliers in the US and Europe face a labor crunch because of the coronavirus pandemic. AGCO, one of the world’s largest farm machinery makers, has had to tell customers that they may have to wait as long as six months for their machinery, effectively too late for the US harvest of corn and soybeans.
  • Some essential industries, including agriculture, have not been impacted by the coronavirus pandemic nearly as much as others, according to the Association of Equipment Manufacturers and economics service provider Oxford Economics. Several key indicators point to healthy growth in the agricultural machinery market in 2021 and 2022. "...farmers are expanding and/or replacing their existing capital. Rather than just spend money on repairing existing equipment, they must be feeling confident enough to start spending on new equipment again,” said Chloe Parkins, senior economist at Oxford Economics. The credit backdrop also remains favorable. The corporate borrowing rate and long-term interest rate are expected to increase slightly this year, but they are still much lower than they were during the 2015-19 timeframe, according to Parkins.
  • Deere & Co, the world’s largest farm equipment maker, forecast a 10% to 15% year-over-year worldwide increase in agriculture and turf equipment sales in 2021. “Higher crop prices and improved fundamentals are leading to renewed optimism in the agricultural sector and improving demand for farm equipment,” said CEO John May.
  • Farm machinery manufacturing employment increased 8.6% year over year in May, according to the US Bureau of Labor Statistics.

July 4, 2021

  • The US Department of Agriculture will provide $700 million for domestic biofuel producers. The announcement sent prices of some renewable fuels higher despite a lack of clarity on how the funds would allocated. Farm raw product wholesalers serving the biofuels industry are likely to benefit if the aid boosts demand for farm products used to make biofuels.
  • Global trade in food and agricultural products increased 3.5% year over year in 2020, according to the World Trade Organization (WTO), but a USDA working paper says that the impact of the coronavirus was obscured by such factors as the de-escalation of trade disputes, particularly between the US and China. “Holding other factors constant, our estimates suggest that COVID-19 reduced overall agricultural trade by the approximate range of 5% to 10%, an effect two to three times smaller than our estimated effect for nonagricultural trade,” said the working paper from the USDA’s office of the chief economist.
  • Pandemic-related supply chain issues that have resulted in rising corn prices and possible corn shortages have some livestock farmers preparing to switch to wheat feed. “We are running out of the corn in the country and wheat got really cheap,” said Joe Nussmeier, a broker at Frontier Futures in Minneapolis. By mid-June, “the only thing to feed critters at that time will be wheat.” Changing the diet of animals comes with some risk: wheat shouldn’t be fed to younger cattle and cows can get bloated if they eat too much of it. Researchers at North Dakota State University recommend that wheat make up no more than 15% of an animal’s diet when it’s being introduced. The color of a bird’s skin can also vary depending on what it eats, with corn-fed chicken looking yellowish, a trait shunned in some countries.
  • The US Department of Agriculture (USDA) allocated an additional $1.1 billion to increase payment rates for more than 410,000 cattle producers under the Coronavirus Food Assistance Program (CFAP) 1 program. The USDA will continue taking applications from swine producers and contract growers for CFAP-AA but would not release payments to pork producers as of late March. The department stated that the payments to pork producers "are likely to require modifications to the regulation as part of the broader evaluation and future assistance." Raw farm product wholesalers are likely to benefit from increased investment in the livestock industry.
  • China bought about 64% of the US agricultural goods agreed to for 2020 in the Phase One trade deal in 2020, according to the Peterson Institute for International Economics. Several experts say that it was unrealistic to expect China to buy the targeted amount of US goods. Meeting that obligation was made even more difficult as the Covid-19 pandemic caused Chinese import demand to plunge. The target rises to $43.5 billion in 2021.
  • China is forecast by the US Department of Agriculture (USDA) to import a record $27 billion worth of farm products in fiscal 2021 (started on October 1) and regain its rank as the top foreign market for American farm products.
  • Wholesale farm product sales decreased 0.2% month over month on an adjusted basis but increased 36.9% in value year over year on an unadjusted basis in April, according to the US Census Bureau. Year over year changes may be distorted by the large pandemic-related decrease in sales during April 2020.

July 12, 2021

  • Farm debt, which was forecast to increase to a 61-year high in 2021, decreased in Q1 with the aid of record federal assistance stemming from multiple years of trade war cash payments and Covid-19 assistance, and with rebounding product values following pandemic-related declines in 2020. Non-real estate farm debt decreased 10% year over year during Q1 while farm-related real estate debt decreased 3% during the period, according to the Federal Reserve Bank of Kansas City. Industry debt is now forecast to increase 2% year over year for all of 2021, the slowest annual growth rate since 2012, according to the US Department of Agriculture.
  • Shipping costs are increasing, partly because of pandemic-related congestion in freight transportation networks. A pandemic-driven shift in consumer purchasing habits from experience purchases to consumer goods purchases, particularly of items for the home, led to a dramatic increase in imports from Asian manufacturing centers, according to The Detroit News. The increase in imports resulted in backups at overwhelmed ports and freight hubs across the US. Businesses of all types are now forced to wait months instead of the usual weeks for deliveries, and no one knows when the situation will be resolved. The Fitch Ratings credit ratings agency said in its ‘Fitch Ratings 2021 Outlook: US Transport’ that the coronavirus pandemic will continue to be an impediment, even though performance will improve in 2021.
  • Agricultural chemicals, including herbicides and fungicides, are in tight supply as shipping backlogs and pandemic-related delays have run headlong into higher demand caused by increased row-crop acreage this year, according to Progressive Farmer magazine. Experts say that some farmers may need to use unfamiliar generic herbicides, which can come with mixing and quality issues depending on their age. Others may have to hunt down substitute pesticides, which will require studying efficacy charts.
  • The US Department of Agriculture (USDA) is dedicating at least $6 billion toward new coronavirus aid programs through an initiative called Pandemic Assistance for Producers. Emphasis will be placed on outreach to small and socially disadvantaged producers, specialty crop and organic producers, and timber harvesters. Support will also be provided for other participants in the food supply chain. Existing programs like the Coronavirus Food Assistance Program (CFAP) will fall within the new initiative and, where statutory authority allows, will be refined to better address the needs of producers.
  • The volatility of crop prices has been exacerbated by the coronavirus and changes in demand. Spot prices for corn were as low as $3.08 per bushel on August 3, 2020, and as high as $6.44 on July 10.
  • Farm supplies wholesaler employment increased 1.7% year over year in May.
  • The global fertilizer market is forecast to grow 4.4% annually through 2025 to reach $3 billion, according to Markets and Markets. The global herbicide market is forecast to grow 6% annually to reach $43 billion by 2024, according to Market Research Future.

July 4, 2021

  • The Michigan Department of Health and Human Services has rescinded its order requiring COVID-19 testing for agricultural employees. Health officials cited increasing vaccination rates, declining coronavirus cases, expanded access to testing and vaccinations, and enhanced housing and worker protections as key reasons for rescinding the order. The Michigan Occupational Safety and Health Administration issued updated emergency rules in June that align with federal guidance, allowing employers to use their best judgment in determining whether to maintain daily health screenings, mask requirements, and social distancing requirements.
  • Farm support services are likely to benefit from lower pandemic-related social distancing costs if the number of COVID-19 cases continues dropping as vaccination rates increase. Fewer than 15,000 new infections are being identified each day in early July, the fewest in nearly a year. About 47% of the country's population has been fully vaccinated as of July 4, and 55% has received at least one dose of a COVID-19 vaccine, according to the U.S. Centers for Disease Control and Prevention.
  • Labor advocates want the federal Occupational Safety and Health Administration (OSHA) to issue an emergency standard that would protect farm workers who are at risk of being exposed to the coronavirus. The advocates, who note that the Biden administration ordered OSHA in January to determine whether there’s a need for an emergency temporary standard protecting workers, say that access to COVID-19 vaccines is a key priority. They also want an emergency standard set for housing and transportation. Many industry experts say that coronavirus safety standards have largely been set at the state and local level.
  • China is forecast by the US Department of Agriculture (USDA) to import a record $27 billion worth of farm products in fiscal 2021 (started on October 1) and regain its rank as the top foreign market for American farm products as it continues to recover from the effects of the coronavirus pandemic.

June 30, 2021

  • The rollout of vaccines, a leveling off of COVID-19 cases, jobs growth, and the passage of the $1.9 trillion stimulus package have helped to buoy investor sentiment. In the second quarter of 2021, the Business Roundtable’s economic-outlook index - which is a composite of large firms’ hiring and spending plans, and includes sales projections – rose nine points, nearly hitting the record high seen in 2018, according to The Wall Street Journal. However, there are concerns that the economy might grow too quickly and trigger inflation. Such concerns may drive some investors to lean on their financial planners for advice about hedging strategies in case the bullish market turns an about face.
  • The pandemic-fueled market volatility in 2020 attracted a wave of new investors and day trading activity on free stock trading apps such as Robinhood. Some Wall Street watchers felt the rise in rookie day trading and robo-advisor investment tools boded ill for the financial planning and advice industry. However, the rise in retail investing may actually drive demand for active planning and advice services as investors realize they may need help in building wealth long-term, according to Financial Planning. A recent research report by wealth management firm Cerulli Associates showed that 40% of investors surveyed said they needed more advice. More than 55% said they were willing to pay for professional advice, and more than 80% who already had paid advisors said it was worth the cost.
  • As the pandemic boosted demand for investment advice, registered investment advice (RIA) firms are looking for new talent and are often finding it at other independent firms, according to Charles Schwab’s annual compensation report released in February. The report is based on a survey of more than 760 firms and took place between January and April 2020. To attract top talent, RIA’s are having to sweeten their insurance and equity-stake plans as well as their compensation offerings. More than 70% of respondents said they planned to hire new staff in 2020. A key area of focus was effectively onboarding new staff in virtual environments amid the pandemic.
  • For high wealth clients, advisors may set up joint meetings with clients’ attorneys and CPAs to adjust tax planning in light of President Biden’s proposed tax increases on individuals who earn more than $400,000 per year. Some experts suggest investors with a large portion of their net worth in pretax retirement accounts should roll a portion of their wealth into a Roth IRA. Assuming taxes may rise, a Roth is attractive because taxes are collected on the front end – while taxes are low – and is tax-free when the money is spent in retirement. Advisors may also advise clients who earn more than $1 million to avoid higher capital gains taxes proposed in the Biden plan by selling off some investments.
  • Despite the pandemic, investors continued to pour money into their investment accounts in the first quarter of 2021, according to analysis of retirement savings trends by Fidelity Investments. Retirement accounts reached record levels for the second consecutive quarter in Q1 2021. The average IRA balance was $130,000 in Q1, a 1% increase over the previous quarter and up 31% over the same period in 2020. Investment activity grew in Q1 as many investors made contributions to IRAs for tax filing reasons. Investors made contributions in 1.3 million IRA accounts in Q1 2021, a 52% increase over Q1 2020. Total IRA contributions in Q1 2021 were $4.3 billion, compared to $2.9 billion the same time a year earlier. The rise in retirement investment activity may signal increased demand for financial planning and investment advice.
  • As the pandemic has increased participation in investing, brokerages have enjoyed strong growth as new investors opened accounts. Fidelity Investments added 4.1 million new accounts in Q1 2021, up nearly 160% compared to Q1 2020. First quarter growth followed a booming full-year 2020 which saw more than 32 million new Fidelity Investments workplace participant accounts opened and 26 million new retail investment accounts. To help service the influx of new clients, in April Fidelity announced it planned to hire about 4,000 new employees and about a quarter of the new hires will be financial planners. The spate of fresh hires planned so far for 2021 follows the 7,200 new associates Fidelity hired in 2020.
  • About half of respondents to a recent survey by Allianz Life said the challenges of making financial ends meet during the pandemic make it difficult to think about retirement saving. However, nearly two-thirds of those participating in Allianz’s 2021 Retirement Risk Readiness Survey said they are paying more attention to their saving and spending habits. More than 55% reported that stock market swings made them nervous about their retirement savings. Among those who are nearing retirement, 37% said they are making a formal investment plan with a financial professional, up from 29% in 2020.
  • About 15% of all stock market investors got their start in 2020 as they sought to leverage stock market volatility amid the pandemic, according to a survey released by Charles Schwab in April. The average age of the new investor is 35, and more than 55% of them believe the stock market will rise in value in 2021. More than 80% are interested in guidance from an investment professional. More than 40% of new investors have not considered the tax efficiency of their portfolio, and more than half reported a lack of understanding about fees.
  • Despite the challenges of the pandemic, financial advisors managed record-high client retention in 2020, according to a recent report by McKinsey & Company. Financial advisors had a retention rate of 94.6% in 2020, topping the previous record set in 2019, and advisors saw less client churn than during the previous financial crisis in 2008. The high level of client retention in 2020 underscored the depth of advisor relationships and the value of human advice during the pandemic, according to McKinsey. Per-advisor median assets also hit a record-high $130 million, a 9% rise over 2019, although 75% of the increase was from market performance. Financial advisors continue to see an influx of younger investors. The percentage of clients between the ages of 25 and 56 increased to 24% in 2020 compared to 19% in 2016. The McKinsey report is based on data from about 70,000 advisors with more than 20 North American wealth Management firms.
  • As advisors and their clients became more comfortable with remote work and digital meeting tools during the pandemic, advisors and their wealthier clients may move away from high-cost, high-tax financial industry epicenters such as New York and San Francisco, according to Financial Planning. The potential for higher taxes by under the Biden administration may also prompt some advisors to reduce their tax burden by relocating to lower tax locales, such as Florida or Texas – neither of which have a state income tax.

June 18, 2021

  • At the onset of the COVID-19 pandemic, music, visual art, dance and other fine art schools had to quickly adapt to distance learning technologies to continue operations. Visual arts schools faced unique challenges with moving to online learning environments because students may lack supplies, materials, or equipment. Some schools focused on research and learning digital skills for online presentation with the hope of more in-person learning later. Some fine arts students may question the value of a virtual arts education and take time off or switch educational paths as the future of performing remains in flux even with ongoing vaccination efforts.
  • Some fine arts schools may have qualified for relief under the stimulus package that passed in December of 2020. The $900 billion stimulus included $22.7 billion for colleges and universities. Higher education has been hit hard as the pandemic reduced enrollment. Meanwhile, schools’ have had to bear higher costs related to the pandemic including testing, protective equipment, health support, and financial aid for students.
  • Fine arts programs – including those in public schools – are exploring ways to continue arts education amid the ongoing coronavirus crisis. Music programs that include singing or brass and wind instruments pose unique challenges as singing and forcefully blowing air are highly efficient methods of spreading coronavirus through airborne droplets. However, researchers at the University of Maryland and the University of Colorado Boulder suggest there are a number of strategies that can mitigate the risk of singing and playing wind instruments in groups, according to The Wall Street Journal. Wearing a mask while singing significantly reduces the number of particles. Particles can also be reduced by placing bags or bell covers over wind and brass instruments. Special masks with slits in them also proved effective at reducing airborne particle emission while playing wind instruments. Singers and wind instrument players should maintain social distancing of at least six feet, nine feet for large instruments such as trombones. Particle build-up can also be reduced by taking 15-minute breaks every 30 minutes where all participants leave the room. Improving ventilation also reduces risk, including opening windows, HVAC systems that bring in fresh outside air three times per hour, or using portable HEPA air cleaners.
  • Some fine art schools have a high percentage of foreign students who left the US when the outbreak began. If foreign students leave, such schools could face revenue shortfalls. Foreign students tend to pay higher tuition than US citizens. In June the Biden Administration announced the formation of working groups to determine how to safely reopen to foreign travelers after 15 months of pandemic-related restrictions, according to Reuters. The work groups include the White House COVID Response Team, the National Security Council, the CDC, and other US agencies as well as key international partners including Canada, Mexico, the UK, and the European Union.
  • Rigorous testing protocols may be a key to allowing fine arts students to rehearse together in smaller groups. University of Iowa (UI) researchers have developed a saliva test for COVID-19 which the university’s arts departments are using to test students prior to scheduling rehearsals. The test can be self-administered and results are returned within a few hours. The test is 95% accurate and is awaiting FDA approval. Some fine art schools may seek to resume some level of in-person instruction as local and state regulations allow. Some schools are embracing hybrid models that supplement less frequent and smaller live classes with online ones.
  • Some schools hope to bring back live performances by limiting audience sizes in auditoriums and concert halls. Performances are also being recorded and made available online or performed live via Zoom. While live performances are seen as an integral part of fine arts education, instructors stress that the most important thing for group performers is being able to rehearse together – even if it’s in smaller groups.
  • As of June 15, 2021, 480 colleges and universities have announced they will require students to be vaccinated if they plan to return to in-person classes for the fall semester. Most of the colleges that have announced vaccinations requirements are private institutions. However, the public university systems in several states will also require in-person students to be vaccinated. Because much of arts education involves performances and the need for in-person instruction, fine arts schools may institute vaccination requirements. Requiring students to have certain vaccinations is not new, and most schools have existing portals for uploading vaccination records. However, laws and regulations regarding vaccination requirements vary by state. Requiring students to be vaccinated may be complicated by the fact that the COVID-19 vaccines were approved by the FDA under emergency use authorizations (EUA). In May, Pfizer put in the request for full FDA approval for the Pfizer-BioNTech vaccine. The same month, Pfizer received FDA EUA for use of its vaccine in children ages 12-15. Some foreign students that have received vaccines that are not yet approved by the World Health Organization (WHO) – including India’s Covaxin and Russia’s Sputnik V – may need to be revaccinated with a WHO-approved vaccine to attend in-person classes, according to The New York Times. However, no one is sure if revaccination is safe.

July 7, 2021

  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. “Single-family permits declined to the lowest pace since September 2020 as the home building market cools somewhat to adjust to higher prices and longer delivery times of building materials,” said NAHB Chief Economist Robert Dietz. “The count of single-family homes permitted but not started construction is up 53% over the last year due to both gains for home construction since the onset of the 2020 virus crisis and the delay of some building projects due to higher costs for materials and labor.”
  • Over 44% of home improvement plans in the US have been delayed due to supply shortages and skyrocketing material costs, according to market research firm, Cardify.ai.
  • Home improvement projects are facing average delays of 1 to 2 months, according to data from the National Association of Home Builders' Q1 Remodeling Market Index.
  • The price of lumber is retreating from record territory during mid-2021 and stood at $793 per thousand board feet on July 2, according to Business Insider. The price had fallen to $496 per thousand board feet on October 26, 2020, from a peak of $941 on September 7. It then rallied to a record $1,686 on May 7, 2021, before starting its retreat. Reduced mill production coupled with rising demand from DIY projects and ongoing construction projects is contributing to elevated lumber prices.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Employment in the specialty trade contracting industry increased 2.5% year over year in June but was down 2.1% compared to June 2019.
  • Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.

July 21, 2021

  • Ammunition manufacturer Ammo Incorporated is building a new factory in Wisconsin. The facility won't address short-term ammunition shortages, as it won't come online until 2022, but it will help address long-term demand issues caused by a surge in firearms sales which analysts say has been caused in part by the coronavirus pandemic.
  • Four out of five consumers encountered out-of-stock issues while trying to purchase ammunition in 2020, while three-quarters encountered out-of-stock situations so far in 2021, according to an April survey by market research firm Southwick Associates.
  • Firearms sales increased 18% year over year during Q1, according to The Trace, a news outlet that tracks gun sales. Americans bought more than 2.3 million guns in January, the highest number since July 2020. Experts attribute a considerable portion of sales growth to fears related to the coronavirus pandemic.
  • Firearms manufacturers are among the beneficiaries of direct payments to US consumers via the coronavirus stimulus package signed into law in March. The most recent round of federal stimulus payments, $1,400 for those with incomes up to $75,000 per year, arrived in bank accounts of many Americans in recent weeks. Gun shop owner Tim Wright said that the payments have led to a direct increase in gun sales at his shop. "It was probably most dramatic on and after March 17," Wright said. "We've had people come in and spend the entire $1,400 right here and say: 'Thanks Uncle Joe (Biden),' as they go out the door."
  • Raw materials shortages are increasing for many firms, including firearms manufacturers, partly because of pandemic-related congestion in freight transportation networks. A pandemic-driven shift in consumer purchasing habits from experience purchases to consumer goods purchases, particularly of items for the home, led to a dramatic increase in imports from Asian manufacturing centers, according to The Detroit News. The increase in imports resulted in backups at overwhelmed ports and freight hubs across the US. Businesses of all types are now forced to wait months instead of the usual weeks for deliveries, and no one knows when the situation will be resolved. The Fitch Ratings credit ratings agency said in its ‘Fitch Ratings 2021 Outlook: US Transport’ that the coronavirus pandemic will continue to be an impediment, even though performance will improve in 2021.
  • Thousands of people barred from purchasing firearms have tried to buy them since the beginning of the coronavirus pandemic, according to the FBI. Gun-control advocates say that more people can slip through the cracks and buy guns when they’re not supposed to because the spike in background checks has resulted in a significantly increased workload. If a background check cannot be completed within three days, the purchase can go through, so a strained system that causes delays would not be able to effectively enforce the law. The US Department of Justice has asked Congress for more resources so it could confiscate guns from people who never should have been able to buy them in the first place.

June 25, 2021

  • In-home fitness saw a surge in popularity during the pandemic, but the Fitness Business Association (FBA) doesn’t expect the trend to hurt traditional fitness centers. The trend is more likely to act as a compliment, according to the FBA. “Remember, it’s not the first rodeo for in-home fitness. That sector of the industry dates back to a Jane Fonda VHS tape, Tae Bo, etc.,” FBA founder and CEO Josh Leve said. “There’s always a shiny new toy.”
  • The Centers for Disease Control and Prevention has issued guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings. Fitness centers are likely to benefit from the relaxed restrictions, as exercising with masks can present difficulties. Experts note, however, that interpretation of the guidance is likely to vary by state.
  • About 42% of adults reported undesired weight gain due to Covid-19, according to a recent survey by the American Psychological Association. The average increase reported was 29 pounds.
  • Both gyms and streaming fitness companies are seeing a surge in new demand and overall workouts. Orangetheory memberships nationwide rose 17% in the first quarter of this year. Growth accelerated during Q1, with the biggest increase (9%) occurring in March, the company said. "We're forecasting that the big boom is September, when we've gotten through the summer, the kids are back to school, there's some normalcy with businesses opening offices again, especially in urban centers like Manhattan and San Francisco," said Crunch Fitness CEO Jim Rowley.
  • The Centers for Disease Control and Prevention has said that cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Fitness centers are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • About 72% of gyms now offer some type of on-demand or livestream workout, up from the 25% of gyms that offered a comparable service in 2019, according to fitness research firm ClubIntel. Some gyms are offering a hybrid model through which classes can be attended in person or online. Some gyms offer live hybrid classes only, but others offer greater flexibility for those who prefer the remote option by offering prerecorded workouts that customers can follow according to their own schedules.
  • About 60% of Americans don’t plan to return to their gym after the pandemic, according to a TD Ameritrade survey.
  • A survey of 3,500 Americans by The New Consumer and Coefficient Capital found that 76% of people have tried working out at home during the pandemic and 66% of those who did prefer it. Among millennials, the number is even higher: 82% made the switch and 81% of those who did like it more.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.

July 7, 2021

  • The accelerating spread of the Delta coronavirus variant has health officials reconsidering the relaxation of pandemic-related safety measures. The World Health Organization reiterated in late June its longstanding recommendation that everyone — including the inoculated — wear masks to stem the spread of the virus. Los Angeles County public health authorities are urging unvaccinated and vaccinated people alike to don masks again inside restaurants, stores and other public indoor spaces because of the growing threat posed by the more contagious Delta variant.
  • Growth in improvement and repair expenditures to owner-occupied homes is expected to remain solid throughout the year and into 2022, according to the Leading Indicator of Remodeling Activity (LIRA) from the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects a healthy pace of mid-single digit gains in annual home renovation and repair spending this year, with 4.8% growth by the first quarter of next year.
  • Some industry experts expect excess office space resulting from the pandemic-driven rise in telecommuting to be converted into housing space. Likely candidates for conversion include aging, deteriorating or functionally and technologically obsolete office buildings; buildings in overbuilt areas or neighborhoods with falling real estate values and rising vacancy rates; and buildings far from public transit. Some buildings could even be adapted for mixed use, with one portion of a building preserved for offices and residential units occupying the remaining portion.
  • Industrial facility construction completions will increase 29% year over year in 2021, according to commercial real estate services and investment firm CBRE Group. Big boxes in the 500,000-square-foot range will account for the majority of new product. Demand growth that began in 2020 will continue in intermodal hubs like the Inland Empire, Dallas, Houston, Chicago, and Atlanta markets. Demand for local infill space will also continue, spurred by the likes of Amazon, Walmart, Target, Best Buy and Costco.
  • The Joint Center for Housing Studies of Harvard University projects annual growth in renovation and repair to soften to 1.7% by the third quarter. “The surge in DIY and small project activity is lifting the remodeling market, but it remains to be seen if the strong sales market this summer translates into larger improvements that would drive even stronger growth in the coming quarters,” said Chris Herbert, Managing Director of the Joint Center for Housing Studies.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Employment in the specialty trade contracting industry increased 2.5% year over year in June but was down 2.1% compared to June 2019.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, increased to 114.7 in May from 106.2 in April, according to the National Association of Realtors. An index of 100 is equal to the level of contract activity in 2001. It is the highest reading for the month of May since 2005. Contract signings increased 13.1% year over year in May, but the large year-over-year change is likely to be due in large part to the pandemic-induced lockdown in 2020.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.

June 24, 2021

  • Businesses that are still reeling from the economic impact of the coronavirus pandemic will have to look for other sources of funding now that the Paycheck Protection Program (PPP) has closed. Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • The US Small Business Administration said that it has approved roughly 3.3 million Paycheck Protection Program (PPP) loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Florists have begun placing orders months in advance due to pandemic-related supply chain delays. “During the shutdowns lot of growers were actually going out of business. We couldn’t get the transportation of the flowers here, just because the flights weren’t coming in,” said flower shop co-owner Jennifer Barnard. Bard says that her shop finalized their Valentine's Day orders in mid-December.
  • Social distancing has initiated the development of the “microwedding,” according to Catersource. Different from eloping, microweddings include the elements of a traditional ceremony and reception on a much smaller scale. Guest lists that average about 25 to 30 individuals allow the bride and groom to celebrate for a few thousand dollars, a fraction of the cost of a traditional wedding. Scaled-down weddings still involve flowers, but budgets are considerably smaller.
  • In the absence of big events that account for a sizable percentage of business, a few New York floral designers have innovated and leveraged the DIY movement. New York floral designer Lewis Miller and other firms ship boxes of 50 to 100 loose stems directly from Dutch suppliers to customers and provide access to online videos that show how to arrange them.
  • “Designer’s Choice” arrangements have become the norm, as florists learn to work with whatever is available. COVID-19 has affected the supply chain, leaving florists unable to procure a variety of popular flowers from South America, Africa, and Holland. Many operators are only open for curbside pick-up and delivery.

July 4, 2021

  • A growing list of trade associations is lobbying federal lawmakers and the Biden administration for a new round of pandemic aid. Associations representing restaurants, hotels gyms, amusement parks, travel agents, convention and trade shows, and horse shows say they suffered massive, unrecoverable financial losses because of social distancing restrictions and still face uncertainties as the economy recovers. Analysts say that the lobbying effort is gaining traction, with Republicans already signing on to bills to give grants to restaurants and gyms. Food distributors may benefit if additional funding helps maintain the viability of these businesses.
  • Large customers like Walmart and Sysco are fining food distributors for late or incomplete orders, according to The Wall Street Journal. Distributors say that labor shortages, supply constraints, and high freight costs are making it difficult to deliver complete, timely orders. Distributors' large customers had excused such penalties for months during the pandemic when surging demand led to widespread shortages.
  • Many analysts say that food distributors should prepare for an upcoming pandemic-related spending shift that is increasingly referred to as revenge shopping. Consumers will sweep through sectors as pent-up demand is unleashed, according to management consulting firm McKinsey. That has been the experience of all previous economic downturns. One difference, however, is that services have been particularly hard hit this time. The bounce back will therefore likely emphasize those businesses, particularly the ones that have a communal element, such as restaurants and entertainment venues. A significant portion of food sales may shift from grocery stores back to restaurants as a result.
  • Kroger, the largest supermarket chain in the US, said that it expects sales at stores open for at least one year (comparable sales) to decline by 3% to 5% year over year in 2021. Sales increased 14.1% year over year in 2020. Kroger cited the end of consumer stockpiling and the availability of coronavirus vaccines, which makes it possible for consumers to shift back to eating more meals at restaurants and outside of their homes, as a key cause of expected lower sales growth.
  • Other grocers have also forecast year-over-year sales decreases. Sales at Sprouts Farmers Market increased 6.9% year over year in 2020, but the chain said that sales growth will decline to low-to-mid-single digits this year. Walmart projects comparable sales to grow by low single-digits in 2021 after 8.6% growth last year.
  • Food distribution industry leader Sysco’s sales were down 23% year over year in the last six months of 2020. Performance Food Group’s sales were down 17% excluding the impact of its acquisition of Reinhart Foodservice. Executives at both firms cite the impact of the coronavirus pandemic on restaurants as a key cause of decreasing sales.
  • The food supply chain is facing another pandemic-induced hurdle in the form of a can shortage. Wholesale manufacturers and distributors are running out of empty cans to pack nonperishable foods that so many consumers are buying in bulk. “Especially in ready-to-eat meals, like chili, soups and prepared meats,” said James Kwon, CEO of technology and logistics firm ePallet. “The cans are in short supply.” Canned items that normally may be unavailable for just a week or two are now delayed for months, according to National Public Radio. Can manufacturers have announced plans to build at least three new factories within the next 18 months. Can maker Ball Corp. will open two new US plants and is adding two new production lines to existing US facilities.
  • The Food and Drug Administration (FDA) has issued a blueprint that the agency said outlines the approach it will take over the next decade to improve food safety. Core sections of the New Era of Smarter Food Safety Blueprint address enhanced traceability, smarter tools and approaches for prevention and outbreak response, new business models, and a culture of food safety. The FDA says that enhanced traceability, coupled with advanced analytical tools, may help the FDA spot potential problems in advance and prevent or lessen the impact of recurring outbreaks of illnesses associated with the consumption of certain foods.
  • Wholesale grocery sales increased 1.8% in value month over month on an adjusted basis 23.5% in value year over year on an unadjusted basis in April, according to the US Census Bureau.  Year over year changes may be distorted by the large pandemic-related decrease in sales during April 2020.

June 24, 2021

  • The Small Business Administration (SBA) hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • US Education Secretary Miguel Cardona said in early May that he expects all schools to be open full-time in person for all students in the fall. Demand for food service contracting services may revert to pre-pandemic levels if the expectation is met. About 54% of public schools below high school were providing full-time in-person learning in early May, up from 46% in January, according to a survey released by the Education Department.
  • The $1.8 trillion American Families Plan, the latest economic recovery plan from President Joe Biden, would provide free school lunch during summer break to 29 million children.
  • A dedicated relief fund of $28.6 billion was provided in the coronavirus stimulus package signed into law in March. The funding will help small and mid-sized hospitality industry firms including food service contractors in need of assistance with rent and operational expenses. It provides grants of up to $10 million per entity with a maximum of $5 million per location based on the difference between 2020 and 2019 revenue.
  • College dining services have been forced to overhaul operations to accommodate social distancing and safety and health regulations because of COVID-19. Customized meals have been replaced by grab-and-go, self-serve is disappearing, and condiment and coffee stations replaced by single-serving packets and paper cups. Some colleges have invested in robots for food prep and delivery.
  • K-12 schools have played a key role in providing meals to students who are part of the National School Lunch Program during the COVID-19 pandemic. Many districts continued to feed students by working with food banks and non-profits, reconfiguring meal distribution plans, and offering workers hazard pay when schools shut down. Almost every school program in the country transitioned to curbside pick-up, according to the School Nutrition Association. According to a survey by Hunger Free America, more than one-third of parents reported skipping meals for their children or reducing serving sizes because they lacked the funds to buy food.

July 21, 2020

  • Manufacturing at major plants in Vietnam stopped recently as coronavirus spread through factories and communities, according to Reuters news service. Several brands shifted some manufacturing to Vietnam and other countries due to issues like tariffs and the coronavirus pandemic, hoping to diversify their supply chain away from dependence on China.
  • A wave of Covid-19 clusters in Asia is creating new bottlenecks in the global supply chain, according to The Wall Street Journal. Vaccination campaigns remain in their early stages in China, Taiwan, Malaysia, and other Asian countries. Thailand has been battered over the past two months by its worst ever surge of new cases, while Vietnam has also suffered. “This is coming at a really fragile time when we’ve just started to see the global trade recovery pick up,” said Nick Marro, the Hong Kong-based lead analyst for global trade at the Economist Intelligence Unit.
  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • Footwear manufacturer Caleres, which closed over 100 bricks-and-mortar locations in 2020, noted that its direct-to-consumer (D2C) channels accounted for 75% of its business during the three-month period ending on January 30. “Caleres is a more agile and focused organization than it was at the start of 2020,” CEO Diane Sullivan said.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.
  • Fashion and performance footwear will boost dollar sales for the overall industry in 2021, though sales will remain below 2019 levels, according to The NPD Group’s Future of Footwear report. “A return to the office and store re-openings will likely reignite some demand for fashion footwear, although the focus will remain on casual and comfort-oriented styles. The pandemic has only amplified the importance of these attributes, as the blending of work-from-home and remote learning has led consumers to favor comfort to wear any time of the day,” said Beth Goldstein, NPD’s fashion footwear and accessories analyst. Performance footwear growth will be driven by demand for road running shoes.

July 13, 2021

  • The US Department of Agriculture (USDA) has been asked to expedite the distribution of $200 million in COVID-19 relief funding for logging and log hauling businesses. The Loggers Relief Act, which was included in the COVID-19 relief bill that was signed into law in December 2020, established a new USDA program to provide direct payments to loggers who have been seriously impacted by the pandemic. The USDA announced in June that the program and others would be implemented in the next 60 days. The $200 million will go to timber harvesting and hauling businesses that have, because of the COVID–19 pandemic, experienced a loss of 10% or more in gross revenue during the period beginning on January 1, 2020, and ending on December 1, 2020, compared to the same period a year earlier.
  • An oversupply of trees relative to the capacity to process them will continue to keep timber prices weak despite the high demand for lumber, according to industry analyst Gregg Brewer. The considerable time that it takes to build a sawmill means that there is limited additional capacity on the horizon to meet high lumber demand. Low timber prices are likely to linger for five to seven years, according to Pete Stewart, president and founder of industry consulting firm Farm2Market.
  • Landowners may be holding onto their trees in anticipation of higher timber prices, according to Brent Sohngen, Professor of Environmental and Natural Resource Economics. Plantation trees are still growing at a rage of 6% or more per year when they are typically cut, Sohngen says. If timber prices start rising quickly, many landowners may refrain from cutting trees longer than they would otherwise because they get some tree volume growth plus the price growth.
  • Logging production increased 5.3% year over year in May but was down 21.7% from the pre-pandemic month of April 2019.
  • Logging companies are seeing strong demand from some customers and weak demand from others, due to COVID-19. Customers that make sanitary paper products (toilet paper, paper towels, wipes) are driving sales of wood chips which are used to make pulp, a raw material of paper products. Conversely, demand from commercial paper manufacturers for pulp is lower.
  • Employment in the logging industry decreased 5.2% year over year in June. The logging segment has an aging workforce and chronic labor shortages. Loss of labor due to coronavirus illness and quarantines is hurting the industry.

July 21, 2021

  • New vehicle sales, an indicator of demand for forging and stamping services, increased 50.2% year over year during Q2 but were down 0.4% compared to the same period in 2019. Analysts say that a semiconductor chip shortage which is limiting auto production will start to ease in Q3, but won’t be gone completely until 2022.
  • The Federal Reserve raised its gross domestic product (GDP) forecast for 2021 to 7% from the March forecast of 6.5%. The median estimate of annual inflation also rose to 3.4% from 2.4% in March, while the median estimate of unemployment remained unchanged at 4.5%. "As the reopening continues shifts in demand can be large and rapid, and bottlenecks, hiring difficulties and other constraints could continue to limit how quickly supply can adjust, raising the possibility that inflation could turn out to be higher and more persistent than we expect," Fed Chair Jerome Powell said in remarks after the announcement.
  • The Federal Reserve expects economic growth to remain above trend for at least two years to come, with GDP at 3.3% in 2022 and 2.2% in 2023, compared to estimated long-term potential growth of just 1.8%.
  • Several industry analysts expect new auto sales to increase about 6.9% in 2021. The National Automobile Dealers Association expects 2021 sales of 15.5 million. Forecasters at car-shopping web site Edmunds also predicted 2021 sales of 15.5 million. Charlie Chesbrough, senior economist for Cox Automotive, said that Cox expects 2021 sales of 15.7 million. US auto sales in 2020 were 14.5 million, down 15% from 2019. It was the fourth-largest annual decline since at least 1980.
  • New orders for durable goods increased 2.3% in value month over month on an adjusted basis in May and 25.7% in value year over year on an unadjusted basis during the first five months of 2021, according to the US Census Bureau. Year-over-year comparisons may be distorted by the large drop in orders during the early months of the coronavirus pandemic.
  • Employment in the forging and stamping industry increased 4.2% year over year in May but was down 8.8% from the pre-pandemic month of May 2019, according to the US Department of Labor.

July 7, 2021

  • The price of lumber is retreating from record territory during mid-2021 and stood at $793 per thousand board feet on July 2, according to Business Insider. The price had fallen to $496 per thousand board feet on October 26, 2020, from a peak of $941 on September 7. It then rallied to a record $1,686 on May 7, 2021, before starting its retreat. Reduced mill production coupled with rising demand from DIY projects and ongoing construction projects is contributing to elevated lumber prices.
  • Framing contractors may benefit from increasing demand for what is often referred to as "other healthcare” facilities. The ongoing shift to diagnosis and treatment outside of hospital settings is likely to continue even if there are not more surges in COVID-related hospitalizations, according to The Associated General Contractors of America. The need for long-term care in facilities other than nursing homes will grow as well. The steady increase in the number of elderly persons and possibly in individuals with chronic symptoms from COVID-19 will further increase demand for new types of medical institutions.
  • The value of commercial and multifamily construction starts in the US decreased 20% year over year in 2020 to $193.4 billion, according to Dodge Data & Analytics. The value of starts in the top 20 metropolitan areas decreased 23% in 2020, falling to $111.1 billion. The New York metropolitan area continued to be the largest market for commercial and multifamily starts at $23.5 billion but suffered a 25% decline from 2019. The Washington DC metro area managed to maintain its second place standing despite an identical decline in 2020 that cut commercial and multifamily starts to $8.9 billion. The Los Angeles, CA, metro area, which fell 21% to $7.4 billion, ranked third.
  • Attorneys at Atlanta-based law firm Fisher Phillips told contractors that it is within their legal rights to compel workers to get vaccinated against COVID-19. Requiring construction workers to get a coronavirus vaccination is comparable to existing rules for healthcare workers that make flu shots mandatory in order to protect all patients and staff and keep the workplace safe, the attorneys said. The attorneys also recommended that contractors set up programs to administer vaccines on jobsites, during work hours, and free of charge, in order to get the highest participation possible while ensuring projects continue to move forward.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Employment in the specialty trade contracting industry increased 2.5% year over year in June but was down 2.1% compared to June 2019.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.

July 8, 2021

  • The pandemic has exposed the vulnerability of far-flung, complicated global supply chains. Some manufacturing industry experts suggest supply chains need to be shorter to be more resilient. Simpler supply chains could reduce global freight demand and shrink the freight forwarding market. Nearly 85% of procurement professionals at North American manufacturing firms are likely or extremely likely to reshore some of their supply chains, according to a June 2021 report released by Thomas, a provider of supplier and product sourcing services. A strong majority of survey respondents plan to reshore some operations despite some challenges in doing so, including price and speed.
  • Air freight posted strong volume in May, although growth slowed relative to the prior month, according to a July report by the International Air Transport Association. Worldwide air cargo demand, as measured by cargo tonne-kilometers (CTKs), was up 9.4% in May compared to pre-pandemic level seen in May 2019, but fell compared to 11.3% growth in April. Global air cargo capacity, as measured by available cargo tonne-kilometers (ACTKs) was down about 9.7% compared to pre-crisis levels. Air freight demand is expected to rise 13.1% in 2021 over 2020, and be 2.8% higher than 2019. The pandemic pushed global air cargo volumes down 9.1% in 2020 compared to the prior year. Worldwide air freight volumes are projected to reach 63.1 million metric tons in 2021, nearly reaching the peak of 63.5 million metric tons in 2018. However, as passenger flights were drastically reduced due to COVID-19, freight capacity has fallen as about half of global air freight volumes are transported in the bellies of passenger flights. However, due to worldwide sea transport congestion stemming from the pandemic, air freight’s cost competitiveness has improved. Prior to the pandemic, air freight was 12 times more expensive than ocean shipping. As of May 2021, air freight’s costs fell to 6 times that of ocean-going freight.
  • In an economic outlook released in December, The Organization of Economic Co-Operation and Development (OECD) estimates global GDP declined 4.2% in 2020. China, with GDP growth of 1.8%, was the only major economy that saw a gain in GDP in 2020. In its December outlook, the OECD projected worldwide GDP would grow by 4.2% in 2021. In March, the OECD upgraded its 2021 global GDP forecast to 5.6% growth amid rapidly accelerating vaccinations and the $1.9 billion US stimulus package. Amid continued vaccination successes in advanced economies, in May the OECD again upgraded its 2021 outlook to 5.8% growth. The OECD also upgraded 2021 US GDP growth from 6.5% to 6.9% (compared to 3.5% growth forecast in December). China’s GDP forecast was upgraded to 8.5% after being downgraded slightly to 7.8% in March from the December estimate of 8%. The OECD noted that countries need to keep up the pace of vaccinations to prevent new coronavirus variants from leading to further outbreaks and economic strain.
  • Transportation and warehousing capacity are tight, according to the July Logistics Manager’s Index (LMI) report. The LMI was 75% in June, up 3.7 percentage points from the prior month. A reading above 50% indicates logistics expansion while a reading below 50% suggests a contraction. June’s warehousing utilization index rose 6.8 points to 75.5%, while the warehouse capacity index declined 7.7 points to 40.7%. With warehousing demand outstripping supply, prices are rising. The warehousing price index rose 2.3 points in June to 85.4. Those surveyed for July’s LMI report tended to be more optimistic about additional warehousing capacity coming online in 2021; they also believed warehousing utilization would continue to grow amid tight capacity. With demand outstripping supply, LMI respondents believe warehousing prices will continue to go up for the remainder of 2021. June’s transportation utilization index rose 3.6 points to 69.7%, while the transportation capacity index increased 1.9 points to 34.5%. With transportation demand outstripping supply, prices are rising. The transportation price index eased 3.9 points in June, but was still high at 87.3%. Those surveyed for July’s LMI report believe transportation capacity may slip in 2021, they also believed transportation prices would keep going up despite any increase in capacity. The LPI is compiled monthly by logistics researchers at five universities and the Council of Supply Chain Management Professionals (CSCMP).
  • The volume of cargo moving through US ports continues to grow amid strong consumer spending, particularly in ecommerce. The Port of Long Beach posted its strongest month on record in May as freight volumes rose 44.4% over year-earlier levels. The Port of Los Angeles also saw its busiest month on record as volumes increased 74% in May compared to the same month a year earlier. Volume growth in both ports was driven by continued strong consumer demand for imported goods amid robust ecommerce sales, and the wider reopening of the US economy. Container volumes at the Port of New York and New Jersey rose 48.2% in May 2021 compared to the same month in 2020.
  • The pandemic has caused a major disruption in the global positioning of shipping containers, according to The New York Times. In the early days of the pandemic key medical supplies and protective equipment poured out of Asia to destinations worldwide. Many of those containers became stranded as global trade slowed. When consumer demand roared back, a shortage of containers slowed trade flows and drove shipping prices higher. Shipping carriers are ramping up efforts to move empty containers back to Asia. China manufactures most of the world’s containers and is boosting production. Some industry insiders believe that falling COVID-19 cases and rising vaccinations will lead consumers to spend more on experiences and less on goods, which could help rebalance the global container fleet. Others worry a fresh round of US stimulus could unleash even more consumer goods spending and make the container shortage worse. The global imbalance of containers could stretch into 2022.
  • Strong US demand for imported goods has created a bottleneck at California ports that has dragged on for several months. Earlier in the pandemic a COVID-19 outbreak among port workers made the backlogs worse and the lingering effects are still being felt. Vaccinations have since slowed the spread of COVID-19 on West Coast ports, but the bottleneck has taken time to clear. Gene Seroka, the executive director of the Port of Los Angeles, has said the number of containerships anchored off the California coast at San Pedro Bay was down to the high-teens in June compared to more than 60 ships that were waiting off the coast in March and April, according to Transport Topics. However, Mr. Seroka also said congestion is likely to remain an issue for at least another six months amid the approaching busy back-to-school and holiday shopping seasons.
  • To prop up shipping rates earlier in the pandemic, containership operators inactivated large portions of their fleets to reduce capacity. The number of inactive containerships – or “blanked sailings” – has risen again amid snarled ports. Containerships waiting off the California coast for unloading puts them behind schedule for returning to Asia and reloading, which has resulted in blanked sailings. As of early June, the number of blanked sailings in 2021 was on par with the level seen at the onset of the pandemic when demand plummeted amid global shutdowns, according to American Shipper. China’s Port of Yantian, the fourth-largest port in the world, was shut down for three days in late May amid a COVID-19 outbreak in Guangdong province. The Yantian port complex returned to normal operations on June 24, but clearing the backlog of containers could take weeks, according to The Loadstar. Bottlenecks at both ends of US-China trade could lead to even more congestion.
  • Amid the ongoing growth of ecommerce, US third-party logistics (3PL) providers are expected to post gross revenues of $246 billion in 2021, a rise of 6.3% over the $231.5 billion in 2020, according to a July 2021 report by Armstrong & Associates. Ecommerce has been the primary growth driver in 3PL demand during the pandemic and it is the largest segment of the US 3PL market, posting average annual growth of 28% since 2017, according to Armstrong & Associates.

July 4, 2021

  • The accelerating spread of the Delta coronavirus variant has health officials reconsidering the relaxation of pandemic-related safety measures. The World Health Organization reiterated in late June its longstanding recommendation that everyone — including the inoculated — wear masks to stem the spread of the virus. Los Angeles County public health authorities are urging unvaccinated and vaccinated people alike to don masks again inside restaurants, stores, and other public indoor spaces because of the growing threat posed by the more contagious Delta variant. Demand for fruits and vegetables by hospitality businesses may decline if cases increase.
  • Kroger, the largest supermarket chain in the US, said that it expects sales at stores open for at least one year (comparable sales) to decline by 3% to 5% year over year in 2021. Sales increased 14.1% year over year in 2020. Kroger cited the end of consumer stockpiling and the availability of coronavirus vaccines, which makes it possible for consumers to shift back to eating more meals at restaurants and outside of their homes, as a key cause of expected lower sales growth.
  • Other grocers have also forecast year-over-year sales decreases. Sales at Sprouts Farmers Market increased 6.9% year over year in 2020, but the chain said that sales growth will decline to low-to-mid-single digits this year. Walmart projects comparable sales to grow by low single-digits in 2021 after 8.6% growth last year.
  • The aluminum can shortage, which industry experts say has been driven primarily by the coronavirus pandemic and rising demand for cans by craft brewers, continues to constrain some fruit and vegetable manufacturers. Can manufacturer Ball Corporation anticipates "demand continuing to outstrip supply well into 2023." Multiple new US production facilities are in operation, according to Ball executives, and the company is readying to ramp up production in its Pittston, PA, plant in the second half of 2021.
  • Health experts have determined that the risk of coming in contact with the coronavirus by handing grocery items like packages of fruits and vegetables is extremely small. Information on the website of the Centers for Disease Control and Prevention says that “because of the poor survivability of these coronaviruses on surfaces, there is likely a very low risk of spread from food products or packaging.” The site also notes that no cases of COVID-19 have been linked to people touching food or food packaging and then touching their faces. There is now wide agreement among health experts that the coronavirus is spread primarily through droplets in the air, according to USA Today.
  • Manufacturers and retailers are focusing on making, delivering, and stocking their top-selling items, which can lead to fewer niche or seasonal items. Additionally, other aisles have less stock because the sector cannot make enough. B&G Foods, which produces Green Giant canned and frozen vegetables, said that it is making as much as possible but hasn’t been able to stock up on extras to prepare for another wave of shutdowns. Other manufacturers such as Kimberly-Clark, and General Mills also said that they haven’t been able to rebuild inventories because of the strong demand.
  • Fruit and vegetable manufacturers may need to upgrade cooling systems in cold storage rooms due to concerns that the coronavirus can spread via HVAC systems. Specialists are evaluating how well heavy-duty filters block microbes and considering whether to install systems that use ultraviolet light or electrically charged particles in the ductwork to kill the virus. Many of the methods to reduce pathogens have been around for years, but were geared more to hospitals than commercial buildings.

July 10, 2021

  • LP gas sales for use in propane-fueled outdoor appliances for the home and RVs may remain strong due to a new surge in COVID-19 cases. The US surpassed 20,000 new Covid-19 cases for the fourth day in a row on July 9. The last time the country had back-to-back days of cases topping 20,000 was in May. The highly contagious Delta accounted for 51.7% of cases in the US as of July 3, according to the US Centers for Disease Control and Prevention. "We know that the Delta variant has increased transmissibility and it is currently surging in pockets of the country with low vaccination rates," CDC Director Dr. Rochelle Walensky.
  • About 90,000 restaurants have closed permanently or long-term since the beginning of the coronavirus pandemic, according to the National Restaurant Association (NRA). That’s less than 14% of the country’s restaurants, and is lower than the 110,000 figure reported by the association in December 2020, when the executive vice president for public affairs, Sean Kennedy, described the industry’s status as “an economic free fall.” An NRA survey conducted from April 1 to April 14 found that 44% of operators expected their average sales from April to June to be higher than in March 2021. Many restaurants use LP gas for outdoor facilities.
  • Sales of generators, grills, patio heaters, and other propane-fueled appliances increased significantly during the coronavirus pandemic, according to LPGas magazine. “Restaurant patios were a must this past winter season, with most restaurants obtaining additional outdoor heating,” said Mike Dodd, CEO of Propane Ninja, a Florida cylinder exchange provider. “We sell to a great deal of restaurants, and demand has been staggering.” Retail outlets such as convenience stores, hardware stores, and supermarkets have demanded more bottle gas due to residents working from and spending more time at home. Many people have purchased propane-powered appliances for personal use outdoors, says Dodd.
  • “Most propane retailers have done very well in the pandemic, particularly if they have barbecue tank exchange cylinders – the business is just through the roof,” says Steve Abbate, managing director of Cetane Associates, a mergers and acquisitions advisory firm. Retailers whose gallon sales rely on restaurants have faced some financial stress, he added. More than 110,000 eating and drinking places were closed for business temporarily or for good as of December 1, 2020, according to the National Restaurant Association.
  • The rise in recreational vehicle activity has driven demand for propane. Most RV appliances, including cooktops, furnaces, grills, refrigerators, hot water heaters, and generators, run on propane. U-Haul, which entered the propane market when it rented RVs, kept its propane business when it exited the RV rental market. The company continues to serve RVers with propane, according to LP Gas.
  • Goldman Sachs believes that global crude demand will not be back to pre-pandemic levels until 2022. Demand is expected to have declined 8% in 2020, to decline 6% in 2021, and fully recover in 2022. Propane supply is driven by economics for crude and natural gas production.

June 5, 2021

  • Legislatures in Alabama, Arizona, Florida, Georgia, Illinois, Louisiana, Maryland, Michigan, Mississippi, Ohio, Texas, Virginia, Washington, and West Virginia have passed bills either extending or making permanent laws that allow alcohol delivery from restaurants, bars and, in some cases, liquor stores. While some of these bills are still awaiting governor signatures at the state level, some cities are also taking unilateral action or asking state houses for legislative action, including New York City. California, Massachusetts, Pennsylvania, South Carolina and Wisconsin are also among states with legislatures that have been debating similar moves in recent months.
  • Payments at full-service restaurants increased 15% in Q1 2021 over Q4 of 2020, according to pay-at-the-table technology maker TableSafe. Payments increased to the highest level since the first quarter of 2020. "... it appears that the full-service restaurant industry may have hit an inflection point in its recovery from the pandemic,” TableSafe CEO Gordon Gardiner said. “This is very encouraging for the restaurant industry and we expect more progress as the full effect of restaurant re-opening comes into play in Q2.”
  • The coronavirus pandemic has removed some of the oversupply of restaurants, according to Restaurant Business. Chains including Ruby Tuesday and Logan’s Roadhouse have closed locations while large numbers of primarily full-service local restaurants have closed.
  • The environment for full-service restaurants will be “choppy” for the balance of 2021, according to, Josh Benn, global head of consumer, food, restaurant, and corporate at financial consultancy firm Duff & Phelps. “The demand is going to be strong as time passes. Whether it’s in Q3 or Q4, there’s going to be a strong consumer bid in the market to go out to have entertainment. All those things are going to drive a nice recovery.”
  • Gene Lee, CEO of Olive Garden parent Darden Restaurants, said that takeout and delivery are likely to dip back below where it had been pre-pandemic. Full-services restaurants may benefit from an expected “return to normal” as vaccinations increase.
  • A number of full-service chains have adopted features from quick-service restaurants. Golden Corral, Applebee’s, Famous Dave’s and Velvet Taco are at least testing drive-thru lanes, and curbside pickup is now standard at many full-service establishments. Outback Steakhouse, Texas Roadhouse, The Cheesecake Factory, P.F. Chang’s, IHOP and Famous Dave’s now have fast-casual ventures (Aussie Grill, Jaggers, Flower Child, P.F. Chang’s to Go, Flip’d and Urban Barbecue, respectively).

June 18, 2021

  • Unadjusted wholesale furniture sales fell 8.5% in April 2021 compared to March but were up 60.9% year-over-year. However, year-over-year comparisons for April 2021 may be misleading because of quarantines and shutdowns in the US and Asia in April 2020. Unadjusted furniture and home furnishing store sales increased 49.5% in the first five months of 2021 compared to the same period in 2020; sales were up 0.2% from March levels. Furniture manufacturing industry employment rose 5.9% in May 2021 compared to prior-year levels, according to the US Bureau of Labor Statistics.
  • All states are in various phases of reopening, and furniture manufacturing firms and major furniture retailers have begun to reopen. Early in the pandemic, industry insiders noted that furniture retail is a tactile business where consumers have traditionally wanted to “try out” products such as sofas, chairs, and beds for comfort – a practice that was thought to be problematic amid concerns about the potential spread of COVID-19 on surfaces. However, additional guidance regarding COVID-19 issued in early April 2021 by the Centers for Disease Control and Prevention (CDC) suggests the virus primarily spreads through the air. The agency said, “It is possible for people to be infected through contact with contaminated surfaces or objects (fomites), but the risk is generally considered to be low.”
  • US new home sales in April 2021 were down 5.9% compared to March, and rose more than 48% year-over-year, according to the Census Bureau. However, year-over-year comparisons for April 2021 may be misleading because of quarantines and shutdowns in the US in April 2020. Homebuilder confidence fell in April, dropping two points to 81, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Any reading above 50 indicates positive builder sentiment. While the National Association of Home Builders said housing demand remained strong, affordability is an increasingly concerning issue amid tight inventories, rising construction costs, and building materials shortages. A healthy housing market is a strong demand driver for furniture sales.
  • During periods of high unemployment, consumers typically postpone large purchases, such as furniture. For the week ending June 12, 2021, there were 412,000 new unemployment insurance claims, up 37,000 from the prior week. While the rise in new claims was the first increase since late April, some economists believe the trend in unemployment claims is approaching historical norms, according to The Wall Street Journal. The long-term average for initial jobless claims is about 370,000, according to Labor Department data. Additionally, the total number of workers receiving unemployment assistance fell by 500,000 to 14.8 million for the week ended May 29. Other signs of a strengthening labor market include rising payrolls, a lower unemployment rate in May, and record high levels of job openings.
  • Makers and distributors of office furniture may have some short-term opportunities but face long-term challenges. In the near-term, some companies may invest in new furniture with features that make workers feel safer – like desks that are further apart and have clear barriers. Schools may invest in acoustic partitions that can help create a barrier between students. The CDC has recommended partitions when social distancing in schools is difficult. Longer term, companies may look to save money on furniture and office space by letting employees work from home.
  • Americans who transitioned to working remotely have tended to spend out-of-pocket to set up comfortable and functional work spaces at home, according to a recent survey of full-time remote employees by discount coupon code company CouponFollow. On average, respondents spent $572 in setting up work spaces in their homes. Among items purchased that are in the moderate-cost range, some of the most popular included sitting desks, office chairs, and stand-up desks. The survey data tended to suggest that people were willing to spend to make their work-from-home spaces comfortable even amid tightening household budgets and economic uncertainty.
  • Stay-at-home orders, working from home, and retail closures created a boom in online furniture sales. Online home furnishings retailer Wayfair reported a 49% increase in sales in the first quarter of 2021 compared to the same period in 2020. The company said it expects consumers in the US and Europe to continue to focus on their homes even as life in these regions starts normalizing. Wayfair’s full-year 2020 revenue was up 55% to $14.1 billion. Industry watchers expect the shift to ecommerce to remain even after the pandemic passes. Furniture wholesalers may seek to establish relationships with customers outside traditional brick and mortar furniture retail.
  • In the first quarter of 2021, US remodelers’ confidence was up strongly compared to the same time a year earlier, according to the National Association of Home Builders’ (NAHB) April 2021 Remodeling Market Index (RMI) report. The RMI in Q1 2021 reached 86, up 36 points from the same time in 2020. Remodeling activity is a key driver of consumer demand for furniture and home furnishings. The NAHB expects US remodeling activity to remain strong through 2021 as the pandemic eases and the economy gains strength.
  • Congestion in ports on both sides of the Pacific Ocean may lead to import disruptions for furniture wholesalers. Earlier in the pandemic a COVID-19 outbreak among port workers in Los Angeles and Long Beach slowed imports. Vaccinations have since reduced the spread of COVID-19 on West Coast ports, but the bottleneck has taken time to clear. Gene Seroka, the executive director of the Port of Los Angeles, has said congestion is likely to remain an issue for at least another six months amid the approaching busy back-to-school and holiday shopping seasons. China’s Port of Yantian, the fourth-largest port in the world, was shut down for three days in late May amid a COVID-19 outbreak in Guangdong province. As of mid-June, about 160,000 containers were stacked up at the port awaiting export. Logjams at both ends of US-China trade could lead to even more congestion.

July 5, 2021

  • Furniture and home furnishings retail sales decreased 2.1% month over month on an adjusted basis in May following a 0.7% in value month over month decrease in April, according to the US Census Bureau.
  • The US Small Business Administration (SBA) stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million Paycheck Protection Program (PPP) loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Pandemic-related demand increases and supply chain disruptions continue to create backlogs and material shortages. The furniture industry is reporting delays of four months or longer at many points in the supply chain, and according to the Commerce Department. Manufacturers cut back production when the pandemic started in March 2020, according to Scott Paul, president of the Alliance for American Manufacturing. They also cut raw material purchases in anticipation of declining consumer demand. Demand for goods did plunge in April but rebounded steadily, fed by households that have held up well during the pandemic.
  • Workplace furniture manufacturer Formaspace is on pace for 30-40% year-over-year growth in 2021, according to CEO Jeff Turk. Formspace saw growth move away from office furniture to laboratory furniture in 2020, but the company began receiving more office furniture orders in March. Turk attributes that to businesses getting ready to go back to their office spaces, and/or companies trying to entice their workers to come back on some sort of regular basis.
  • Many experts say that telecommuting has been normalized, and furniture manufacturers are likely to benefit as telecommuting plays an integral role in future employee work patterns. About 17% of employees were telecommuting full time before the pandemic, according to Forbes Magazine. That increased to 51% In April 2020, after the nationwide lockdowns forced employees from their offices. If part-time employees are included during the April time frame, the percentage of employees working remotely jumps to 66. Nicholas Bloom, an economics professor at Stanford University, says that while the percentage of telecommuters is likely to drop somewhat immediately after the pandemic, the stigma surrounding from working at home is gone. Bloom noted that a number of corporations are developing work-from-home plans beyond the pandemic.
  • A survey done by Global Workplace Analytics and Iometrics found that only 6% of employees do not want to work from home at all while 76% want to be in the office an average of 2.5 days a week. "Our forecast is that once the dust settles, 25%-30% of the workforce will continue to work from home at least one day a week, with the sweet spot being about 2.5 days," said Kate Lister, president of Global Workplace Analytics.
  • Household and institutional furniture manufacturing industry employment increased 8.2% year over year in May but was down 8.1% compared to May 2019 according to the US Bureau of Labor Statistics. Office furniture and fixtures manufacturing industry employment decreased 1.8% year over year in May and was down 15.3% compared to May 2019.
  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.

June 22, 2021

  • Retail sales for the furniture and home furnishings industry decreased 2.9% in value month over month on an adjusted basis in April but increased 49.5% in value year over year on an unadjusted basis during the first five months of 2021. Sales had increased 5.9% in value month over month on an adjusted basis and 49.6% in value year over year on an unadjusted basis in March.
  • Furniture stores may continue to benefit from the increase in telecommuting as the pandemic wanes. About 58% of respondents to a survey by online job search service FlexJobs said that they would "absolutely" look for a new opportunity if they weren’t able to continue working remotely in their current role. Many remote workers have set up a permanent workspace in their homes, whether it’s a dedicated office space (34%) or an "actual" home office (24%), according to FlexJobs. Nine in 10 telecommuters reported spending money on their home office in 2020.
  • Furniture stores are experiencing record shipment delays due to pandemic-related worldwide supply chain disruptions. Material shortages and pandemic safety measures have slowed production in factories. Store owners say that they have to guess at wait times, and the information from their suppliers is often inaccurate. “We like to be up front [with customers], but we can only go by the information that we have," said Rob Rubin, co-owner of New England furniture store chain Bernie & Phyl's. "The lead times, what used to take us 30 days to get is now upwards of five or six months."
  • The University of Michigan’s consumer sentiment index, a measure of consumer confidence, decreased to 82.9 in May from a 13-month high of 88.3 in April. Analysts say that the decline in consumer sentiment was triggered by sudden worries about inflation. Consumer prices have surged this year and jumped more than 4% in the past 12 months, a 13-year high. The Federal Reserve, the nation’s inflation watchdog, maintains that prices will come back down once the economy has mostly recovered from the coronavirus pandemic and pent-up demand is satisfied.
  • Some furniture retailers have been able to capitalize on rising consumer demand for refurbished office furniture. Chicago firm Rework has seen noncorporate walk-in and online orders increase to about $100,000 per month from a pre-pandemic monthly average of $3,000, said co-owner Mark Knepper. Business has picked up significantly since August 2020. “It took that long for people’s backs to hurt, and for people to realize they could be sitting in the kitchen for a long time to come,” Knepper said. “That’s when a lot of companies started offering stipends.”
  • Employment in the furniture store industry increased 55.8% from the  pandemic-related low of April 2020 but was down 3.9% from the pre-pandemic month of April 2019.

June 16, 2021

  • Global oil demand is expected to rise above pre-pandemic levels by the end of 2022, according to the International Energy Agency’s (IEA) June 2021 Oil Market Report. After a record decline of 8.6 million barrels per day (b/d) in 2020, global oil demand is forecast to rebound by 5.4 million b/d in 2021, then add another 3.1 million b/d to reach a total of 99.5 million b/d by the end of 2022. While advanced economic have mostly contained COVID-19 through successful vaccination campaigns, countries outside the Organisation for Economic Co-operation and Development (OECD) with less access to vaccines will recover more slowly. Aviation is expected to be the slowest to recover as air travel takes more time to return to pre-pandemic levels. Gasoline demand will also be challenged by ongoing work-from-home policies and electric vehicle adoption. Petrochemical demand, primarily for plastics production, is forecast to be a key driver of increased oil demand. To meet the gradual increase in global oil demand, the IEA says major producers, including OPEC+ nations and the US will have to increase production.
  • The number of oil rigs in operation has fallen drastically since the onset of the pandemic. The US oil and gas rig count as of June 11, 2021 was 461, up five from the prior week and 182 higher from a year ago, according to Baker Hughes Rig Count. While the rig count was up year-over-year, producers slashed rigs early in the pandemic and rig counts on June 12, 2020 was only 279 amid coronavirus-related lockdowns and drastically reduced oil consumption. However, on June 11, 2021, rig counts were up 89% compared to the low of 244 seen in August 2020. As oil prices have recovered, drillers are gradually increasing drilling activity. Some energy firms are increasing drilling and completion spending in 2021, although the boost is small as oil companies focus on cash flow, debt reduction, and shareholder returns rather than increasing output, according to Reuters.
  • Exploration and production (E&P) companies slashed capital expenditures in 2020. Together, 2020 writedowns by BP, Royal Dutch Shell, and Exxon totaled $51.4 billion, according to Bloomberg. In 2021, US E&Ps are expected to further reign in spending, reducing capex by about 8% compared to 2020, according to a Raymond James survey of mid-to-large E&P firms released in April 2021. On a global basis, upstream oil and gas investment is expected to rise about 10% in 2021, according to the IEA. However, investments are projected to remain well below pre-pandemic levels. Investments among oil and gas majors are likely to remain flat while national oil firms increase spending in hopes of gaining market share in the event of a major uptick in global demand, according to the IEA.
  • The pandemic and resulting drop in oil consumption is fueling consolidation in the US shale oil industry, according to the New York Times. In January, Conoco Phillips finalized its acquisition of Texas-based Concho Resources. In October, Chevron completed its purchase of Nobel Energy. Amid higher oil prices and vaccine rollouts, the first quarter of 2021 was marked by more consolidation as larger shale players used their equity to purchase smaller firms that have quality assets and low debt, according to The Wall Street Journal.
  • US natural gas consumption is forecast to fall 0.5% in 2021 due to higher prices reducing the use of natural gas by electric power plants. The ongoing economic recovery is expected to drive an increase in industrial natural gas consumption in 2021. Residential and commercial consumption are also projected to increase.

July 19, 2021

  • The Transportation Security Administration screened 2.2 million passengers at airports on July 18, the highest number since February 8, 2020, which was about one month before lockdowns and coronavirus restrictions were put in place. Gift and souvenir stores are likely to benefit from increasing travel.
  • About 73% of consumers who typically visited shopping centers before the pandemic intend to return again after they have been vaccinated, according to a global survey by IBM's Institute for Business Value. Retailers should look to in-store promotions, which ranked as the most compelling reason for consumers to shop in a physical store, especially for Gen X (54%) and those over 55 (52%), according to the survey.
  • Investment management firm Elliott Management Corporation has acquired the assets and business operations of gift store chain Paper Source, which had filed for Chapter 11 bankruptcy protection. “As with many other retail brands, [Paper Source has] sustained deep damage to their finances and operations as a result of the ongoing COVID-19 pandemic,” said Paper Source CFO Ronald Kruczynski in the chain’s bankruptcy filing.
  • The Centers for Disease Control and Prevention said in April that, based on analysis of the latest available data, cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Gift and souvenir stores are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.

July 18, 2021

  • Nanotechnology is helping glass manufacturers provide solutions for customers hoping to make spaces easier to clean following the rigors of pandemic-related guidance. The “tintability” of nanotechnology-powered glass will allow hospitals and hotels, for example, to get rid of unsanitary curtains and replace them with glass partitions that can be sanitized and cleaned much more easily and quickly. Nanotechnology-driven innovations such as suspended particle device glass technology also offer much greater glare control and heat reduction without cutting off as much natural light as curtains and other types of shading devices may.
  • Purchasing related to home-based work, education, fitness, entertaining, and healthy home increased significantly in 2020, but these "pandemic pillars" will eventually start to moderate as restrictions ease and consumers revive more pre-pandemic activities, according to a late May presentation from The NPD Group. Firms that make glass houseware products may be negatively affected by the return to pre-pandemic spending patterns. Consumers will once again start spending on travel, dining out, and other experiences as vaccination rates increase, according to The NPD Group.
  • Multiple-dose glass vials may not be a viable option for future vaccine manufacturing, according to Dr. Ian Muir, chief executive of pharmaceuticals manufacturer Porton Biopharma. There are only a few manufacturers in the world who can make the specialized vials that vaccines are currently delivered in, Muir said. He added that the supply chain for the vials is getting longer as demand for them grows around the world. Additional delivery systems like single use plastic vials or single-use prefilled syringes may be needed because just making enough glass, anywhere in the world, and filling it is going to be a major constraint.
  • Schott AG, the world’s biggest supplier of specialty glass for medical bottles and syringes, said that it doesn't expect a shortage of vials for bottling COVID-19 vaccines. Drug makers had warned of limited supplies in 2020. Schott said at the time that their rush to secure supplies early risked making matters worse. “Customers are ordering only to the extent that they actually build up their own production capacities,” a company spokesperson said in late January. “We seek reassurance that orders are not placed to build early reserves, so that all firms that really need (vials) for filling can be served,” he added.
  • SiO2 Materials Science's Auburn, AL, facility went from manufacturing 10 million vials per year to over 10 million vials per month and their local workforce grew from 100 employees to over 500. Each vial manufactured by SiO2 is multi-dose and can hold anywhere from 8-10 doses of COVID-19 vaccine.
  • The vast majority — 70% to 90% — of medical glass is made overseas, according to Chandra Brown, CEO of digital manufacturing institute MxD.
  • Industry experts say that the pharmaceutical industry has settled on 10-milliliter vials, capable of holding eight to 15 doses, as the most common standard for a coronavirus vaccine. A key reason for multi-dose vials is to conserve glass supply. Single-dose vials and single-dose, pre-filled syringes have become commonplace for many vaccines, although multi-dose vials are available as well, according to the CDC.
  • Glass manufacturing has continued largely unimpeded during the coronavirus pandemic, according to Nicole Harris, president of the National Glass Association (NGA). Glass operations were declared essential and run continuously, largely because the large glass-making furnaces are extremely difficult and expensive to shut down and restart. Raw materials used to make glass run 24/7 through ovens that can be as long as three football fields. Demand for glass is currently being driven mainly by hospitals, medical centers, testing laboratories, and manufacturers of medical supplies and equipment.

July 7, 2021

  • Total construction spending decreased 0.3% month over month on an adjusted basis but increased 7.4% year over year on an unadjusted basis in May, according to the US Census Bureau. Residential construction spending increased 0.2% month over month and 27.7% year over year in May. Nonresidential construction spending decreased 0.7% month over month and 7.1% year over year in May.
  • Homebuilding across the nation expanded the fastest in places with the shortest commute times, according to the quarterly National Association of Home Builders (NAHB) Home Building Geography Index (HBGI). The HBGI also shows that the suburban shift in new home construction to low density, low cost markets stemmed largely from the Covid-19 pandemic, was first reported in the second quarter of 2020, and continued into 2021.
  • The number of hotel projects completed, a driver of demand for glass installation, will increase 11.5% year over year in 2021 and 11% year over year in 2022, according to Lodging Econometrics.
  • Nonresidential construction is expected to decrease 5.7% year over year in 2021, according to a consensus forecast from the American Institute of Architects. Health care and public safety are the only two major sectors in the AIA Consensus Construction Forecast projected to see slight increases — up 1.2% and 1%, respectively— in 2021. Overall nonresidential construction spending is projected to increase 3.1% year over year in 2022.
  • Glass and glazing contractors may benefit as COVID-19 outbreaks on college campuses help boost interest in trade schools. A Siegemedia survey of 1,500 Americans shows that about 30% of respondents view trade schools as a more favorable option than going to college. Only 9% viewed vocational schools as a worse option, while 58% found the two to be about equal. A similar survey conducted in 2019 found that only 25% of young Americans thought that trade school offers a better future than college. Other benefits cited by those now favoring trade school were less debt (cited by 35%) and better chances at finding a job (30%). About 16% of respondents said they felt trade schools lead to better paying jobs than those facilitated by college.
  • Employment in the specialty trade contracting industry increased 2.5% year over year in June but was down 2.1% compared to June 2019.
  • The number of building permits issued for privately-owned housing units decreased 3% month over month but increased 34.9% year over year in May. Housing starts increased 3.6% month over month and 50.3% year over year in May. Housing completions decreased 4.1% month over month but increased 16.1% year over year in May. Year-over-year changes are likely to have been affected by the large decrease in permit issuances, housing starts, and housing completions in May 2020 due to the coronavirus pandemic, and may not be indicative of future activity.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, decreased to 81 in June from 83 in May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level since August 2020, as construction costs pushed new home prices higher, sidelining buyers and making it harder for some builders to get loans.
  • Pella and Infinity from Marvin offered virtual appointments to remain connected to customers during the COVID-19 pandemic. Both companies reported an increase in demand for virtual appointments.

June 25, 2021

  • The resurgence of interest in golf will be tested as the coronavirus pandemic wanes. The US has been averaging fewer than 15,000 cases a day since early June, the lowest totals since testing became widely available. About 45% of the country's population has been fully vaccinated as of June 25, and 53% has received at least one dose of a COVID-19 vaccine, according to the US Centers for Disease Control and Prevention.
  • Golf rounds increased 24.3% year over year during Q1, according to the National Golf Foundation.
  • Total rounds of golf played increased 13.9% year over year in 2020, according to Golf Datatech. The percentage increase was the highest since Golf Datatech started tracking rounds played in 1998. The only time the industry saw a bigger spike in rounds played was in 1997, the breakout year for Tiger Woods, according to the National Golf Federation.
  • Increases in rounds played varied greatly by region in 2020. The area defined as West North Central by Golf Datatech – Missouri, Kansas, Nebraska, Iowa, Minnesota, South Dakota and North Dakota – saw a 23.1% year-over-year increase in rounds played in 2020. That compares to only a 4.8% annual rise – the smallest of any region in the US – in the Pacific Region of California, Oregon and Washington. Resorts that depend heavily on travel – especially those to which players typically fly – have not seen a strong rebound as travel overall has diminished during the pandemic.

June 18, 2021

  • The CARES Act provision that reimburses federal contractors who extend coronavirus-related paid leave to their employees and subcontractors was set to expire on September 30, 2020. The provision – Section 3610 – funds contractor employees’ paid leave when COVID-19 has prevented access to government worksites and workers’ jobs could not be performed remotely. President Trump signed a continuing resolution September 30 that continued to fund the government – including Section 3610 - through December 11, 2020. Section 3610 was again extended as part of the $900 billion stimulus bill passed in December 2020. The extension runs to March 31,2021. President Biden’s signing of the American Rescue Plan Act on March 11, 2021 further extended Section 3610 to September 30, 2021.
  • Legal experts suggest the large sums of COVID-19-related money flowing to contractors from the Small Business Administration will further the trend of tighter DOJ enforcement under the False Claims Act. Contractors are urged to make certain of eligibility when applying for contracts and when subcontracting or providing contract support for partner companies.
  • In the early days of the pandemic, the US government scrambled to get enough emergency supplies where they were most needed, and contract awards were expedited. Under the CARES Act, government contractors also qualified for loans through the Small Business Administration (SBA) by the Paycheck Protection Program (PPP). Some legal experts – including federal auditors - worried the haste in awarding contracts and relief aid may have created a potential for fraudulent “double dipping.” Some federal contractors repaid their loans over the summer of 2020, with interest, to avoid any regulatory or oversight complications, according to the Wall Street Journal. In March 2021, the Government Accountability Office (GOA) placed PPP on its High-Risk List due to concerns about program integrity. That same month, the GOA requested the SBA implement a strategy for PPP fraud risk assessments. The GOA continues to review the SBA’s PPP loan forgiveness and review processes.
  • A third round of PPP funding was part of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act that was built into a larger fiscal 2021 spending package passed in December. The second round of PPP extended the lending program aimed at helping small businesses retain their workers. The funding included $284 billion for additional PPP loans (that can be forgiven) which are administered by the Small Business Administration (SBA). Amid concerns that the first rounds of PPP loans were inequitably awarded, the second round prioritized funding for loans by community lenders serving underserved borrowers, including businesses led by women, minorities, and veterans. In March 2021, President Biden signed the American Rescue Plan Act which included an additional $7.25 billion in PPP funding, and kept the application window open until the end of May 2021. Government contractors are eligible for PPP loans, but the Office of Management and Budget notes that contractors must provide the government with credits or reductions in billing for costs paid with PPP dollars, especially if the contractor hopes to have their loan forgiven. The PPP ran out on money on May 11 and stopped accepting most new applications, according to The New York Times.
  • The US response to the COVID-19 pandemic drove a large jump in spending on government contracts. Since the onset of the pandemic, the US government has awarded more than 40,000 prime contracts amounting to about $153 billion. Much of the uptick in spending has been through three major government stimulus bills. The CARES Act passed in March 2020, and a second, $900 billion stimulus bill passed at the end of 2020. Spending increased further under the $1.9 trillion American Rescue Plan Act passed in March. The plan allocates $123 billion for COVID-19-related policy spending, including testing and contact tracing ($50 billion), disaster relief funds ($47 billion), vaccine distribution ($16 billion), and purchase and distribution of medical supplies under the Defense Production Act ($10 billion).
  • In late January, President Biden signed an executive order aimed at protecting workers and on-site government contractors in government agency offices during the pandemic. The order created the Safer Federal Workforce Task Force which, in cooperation with the Office of Management and Budget (OMB), has issued initial guidance for heads of government agencies to implement COVID-19 workplace safety plans. Some key requirements include maximizing remote work for federal workers and contractors, a 25% capacity cap on federal office spaces, and a mandate that masks must be worn at all times in federal offices.
  • US government contractors could be required to certify or represent that their employees have received COVID-19 vaccinations, according to JD Supra. Including social policy clauses in government contracts is common and dates to the 1960s. The National Emergency created by the pandemic could be an impetus for vaccination requirements and there currently is enough vaccine available to support such a move. Some legal experts suggest private employers can legally require employees be vaccinated as a condition of continued employment, but the law on the matter is still in flux, according to JD Supra. However, any requirement for contractor vaccinations may face some pushback and would have to include exemptions under Equal Employment Opportunity Commission guidance regarding disabilities, religious practices, and state law conflicts. According to a Brookings Institute estimate released in October 2020, there are about 5 million federal contractors that are essential to the functioning of the US government.
  • A Pentagon policy change early in the pandemic helped keep many smaller defense subcontractors afloat, according to Government Executive. The policy allowed prime contractors – such and Lockheed Martin and BAE Systems – to receive a larger share of contract payments upfront which allowed them to pass the money on to smaller subcontractors. The policy change was particularly helpful for aerospace subcontractors that saw demand from the commercial aircraft market dwindle amid the drastic drop in airline traffic. Such companies were able to pick up the slack with higher upfront payments for their military contracts. About 75% of member companies in the Aerospace Industries Association say they benefitted from the increase in upfront payments. Since the onset of the pandemic, the Pentagon has dispersed $4.6 billion to defense firms, according to Bloomberg. Contractors would like Congress to pass legislation that would make the Pentagon’s policy change permanent.
 

July 21, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • Grain processing industry stakeholders who responded to a World-Grain.com readership survey conducted in mid-May said that the coronavirus pandemic limited their ability to obtain raw materials or other ingredients used in their production processes. The most impacted sector by far was the feed milling industry, where 60% of the respondents said they had problems obtaining raw materials.
  • Around 40% of flour milling and feed milling industry respondents to the mid-May World-Grain.com readership survey reported an increase in demand for their products during the coronavirus pandemic. Roughly the same percentage of respondents in those two industries reported a decrease in demand for their products, with 20% reporting no change.
  • Consumer market research firm Hunter conducted a survey in March which that found 71% of Americans plan to continue cooking at home. A Mintel Group survey from March found that about a third of Americans were baking more often and plan to keep at it.
  • Calls to King Arthur’s baker’s hotline increased 43% during the pandemic. King Arthur co-CEO Karen Colberg told Yahoo Finance in March that they’re still seeing baking levels up 25% to 30% over pre-pandemic levels.
  • Global ethanol production may fall to 2013 levels and may not recover until 2022, according to Brian Healy, director of global ethanol market development at the US Grains Council. Production will decline due to demand destruction caused by coronavirus pandemic quarantine measures. “About half of the US industry is offline or under capacity,” Healy said. “There’s some recovery in China and a few states in the US are opening up, but demand for gasoline and ethanol is still falling in major gasoline markets, including the US, the EU, and India.”
  • Flour milling giant Ardent Mills is pushing more broadly into direct sales and making investments to package flour for sale to meet demand created by changing consumer behavior, the company said. The largest US miller of grain into flours has established a dedicated a team of employees to its growing retail flour efforts and has been adding warehousing and packing lines at sites around the country. Adding retail capabilities is both a response to make its flours more easily available during the Covid-19 pandemic and a longer-term growth strategy, company officials said.

July 8, 2021

  • Private foundations have stepped up to help battle the coronavirus by providing millions in funding for outbreak-related research, food insecurity, and other emergency relief needs. Candid, a non-profit that collects data on philanthropies, has identified more than 48,000 grants totaling more than $25 billion in response to the coronavirus to date.
  • In 2020, more than $20 billion in COVID-19 relief was awarded globally, according to a recent report by Candid and the Center on Disaster Philanthropy (CDP). Corporations accounted for almost nearly 44% of funding in 2020, but community foundations awarded the most grants of any grantmaking type, and made up more than half of the grants awarded. Giving by independent foundations more than doubled, rising to $4.7 billion in the second half of 2020 compared $1.7 billion in the first half. The CDP noted that second-half funding improved for vulnerable populations in the US – such as Black, Indigenous, and People of Color (BIPOC) communities – which have disproportionately suffered from the health and economic effects of the pandemic. The CDP reports US BIPOC communities accounted for 35% of all specified funding during the second half of 2020 compared to just 5% in the first half.
  • More than 65% of charitable organizations report the challenges that they face due to the pandemic have increased over time, according to a global survey of charities conducted in April 2021 by CFA America. More than 60% of charitable organizations have seen their costs rise during the pandemic, and 70% changed their strategies/priorities to offer new services or programs. More than 80% of charities said their top funding need was to continue support for programs and services. Other top funding needs included salaries, marketing/fundraising, IT/technology, and staff training and skills development. The latest CFA America survey also suggested charitable organizations were in a better condition compared to mid-2020. In the latest survey, 22% of charities predicted they would not survive another 12 months compared to one-third that said the same thing in June 2020. Nearly 60% of organizations say they are confident they can successfully deal with whatever crisis occurs next.
  • Foundations are required by law to annually pay out 5% of their endowment. A group of five large foundations – including the Ford Foundation and the Catherine T. McArthur Foundation – jointly announced they would increase their payouts above 5% for the next two or three years. Another 775 foundations have pledged to loosen restrictions on how the charities they support use funds to give them more flexibility in response to the pandemic.
  • Amid rising need during the pandemic, several major foundations issued a total of about $3 billion in bonds in the second half of 2020 to help cover their increases in grant making, according to the Chronicle of Philanthropy. Low interest rates have made the issuing of bonds an attractive alternative for some foundations. While the nonprofits they support saw their finances pummeled by the pandemic, grantmaking foundations have generally done well as most of their income is from investments and Wall Street has performed well for most of the pandemic.
  • Nonprofit organizations are finding their budgets squeezed as demand for services remains but staffing and donations have waned. A second round of stimulus relief was passed in December. The $900 billion spending bill included more than $284 billion for first and second forgivable Paycheck Protection Program (PPP) loans, and expanded eligibility for nonprofit organizations. However, the bill did not include aid for state and local governments. Typical nonprofits get four times as much funding from state and local governments as they do from private foundations, according to Nonprofit Quarterly. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act (ARP). The third round of stimulus includes $360 billion in aid to state and local governments. State and local governments are free to spend the funding on nonprofits that serve the greater good of the community. The ARP also included an additional $7.25 billion for the Paycheck Protection Program (PPP) which provides forgivable loans through the Small Business Administration (SBA) and was created under the CARES Act. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • Grantmaking organizations are uniquely positioned to aid governments as they battle the coronavirus pandemic, according to the Chronicle of Philanthropy. Through their giving, non-profit organizations can work with governments in three key ways: improving transparency and accountability to weed out corruption, providing resources that enhance data-driven policymaking, and promoting civic engagement through public health advocacy and grassroots organization.
  • In April 2021, the World Health Organization (WHO) Foundation along with the Bill & Melinda Gates Foundation announced the launching of a global mass fundraising campaign to help Covax, the international effort to distribute COVID-19 vaccines to low-income countries. The “Go Give One” drive aims to raise billions of dollars in small donations with the help of corporations, religious organizations, and world leaders. Covax was initially funded by the WHO, UNICEF, and other global health agencies. The Go Give One campaign will cooperate with healthcare systems and mass vaccination sites to advertise the program. The campaign also aims to work with corporations to help them promote Go Give One to their employees and customers through corporate social media platforms.
  • Giving to charitable causes rose during the pandemic, helped along by a rising stock market and government stimulus, according to the Annual Giving USA Foundation report released in June. Charitable giving increased 5% in 2020 to $471.4 billion – a new record. Donations were aided by healthy gains on Wall Street – the S&P 500 rose more than 16% by the close of 2020. Stimulus payments sent directly to Americans also helped boost giving as personal incomes went up. Giving by foundations grew the most with a rise of 17% and reached $88.6 billion. Corporate giving declined 6.1% to $16.9 billion as the pandemic put a dent in firms’ profitability. Donations from individuals were up 2.2%. Giving planned in the event of a person’s death, or bequests, grew 10.3%. Charitable organizations focused on civil rights and environmental issues saw the largest jump in giving. Donations also rose for charities involved in religious, education, and human services causes. Health-related charities experienced a 3% dip in donations as the pandemic sidelined walks and fun runs that are major sources of fundraising. Arts giving declined 7.5%.
  • The charitable giving trends of 2020 appear to have continued in the first quarter 2021, according to fresh analysis by the Fundraising Effectiveness project, a research program of the Association of Fundraising Professionals Foundation for Philanthropy and GivingTuesday. The research suggests the number of donors increased 10% in the first three months of 2021 compared to the same period in 2020. However, the research revealed similar imbalances found by the Giving USA study. Overall giving was boosted by increased donations to human services causes which offset drops in giving to other types of charities. Nonprofits that provide human services saw giving rise more than 11% in the first quarter of 2021. Donations for environmental and animal charities increased nearly 4% each. All other types of causes - including education, arts, health, international aid, and religion - all experienced median declines in dollar donations.

July 5, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • Commercial bankruptcy filings increased 11% month over month in June but were down more than 30% year over year, according to Epiq Bankruptcy Solutions. Filings were at their lowest level for June since 2006. Filings were down 27% year over year for the first half of 2021.
  • A larger share of distressed companies upended by the COVID-19 pandemic is using court processes to restructure instead of close, according to S&P Global Market Intelligence. Nearly 62% of corporate bankruptcy filings in 2020 sought reorganizations, the highest rate for any year going back to at least 2010. Companies were less likely to liquidate in 2020, a departure from 2019 and 2018 when corporate liquidations outpaced reorganizations in bankruptcy filings. As of March 30, the share of filings seeking restructuring is larger in 2021 than in 2020. S&P analysts note that government stimulus and easy access to capital have kept at-risk companies from entering bankruptcy following a jump in filings during the early months of the pandemic in in 2020, but bankruptcies are likely to pick up again later in 2021 as companies confront the aftershocks of the pandemic.
  • Real disposable income, an indicator of demand for discretionary purchases, decreased 2.8% in May following a  15.1% in April and a 22.7% increase in March. The decrease in personal income in May and in April primarily reflected a decrease in government social benefits. Payments made to individuals from the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued in May, but at a lower level than in April. Unemployment insurance also decreased, led by decreases in payments from the Pandemic Unemployment Compensation program. Consumer spending was unchanged in May. Spending and income are expected to rebound in the coming months as more people become vaccinated.
  • Employment at graphic design services increased 16.2% year over year in May but was down 0.8% compared to May 2019, according to the US Bureau of Labor Statistics.

July 1, 2021

  • The accelerating spread of the Delta coronavirus variant has health officials reconsidering the relaxation of pandemic-related safety measures. Los Angeles County public health authorities are urging unvaccinated and vaccinated people to don masks again inside restaurants, stores and other public indoor spaces because of the growing threat posed by the more contagious Delta variant. The World Health Organization reiterated in late June its longstanding recommendation that everyone — including the inoculated — wear masks to stem the spread of the virus.
  • Trader Joe's, and Walmart are among the major grocery retailers that have dropped mask requirements. Many analysts expect foot traffic to increase at bricks-and-mortar retailers as mask requirements are dropped.
  • Kroger, the largest supermarket chain in the US, said that it expects sales at stores open for at least one year (comparable sales) to decline by 3% to 5% year over year in 2021. Sales increased 14.1% year over year in 2020. Kroger cited the end of consumer stockpiling and the availability of coronavirus vaccines, which makes it possible for consumers to shift back to eating more meals at restaurants and outside of their homes, as a key cause of expected lower sales growth.
  • Other grocers have also forecast year-over-year sales decreases. Discount grocer Grocery Outlet said that comparable sales in the first quarter of 2021 are likely to decline into the high-single digits. Sales rose 12.7% last year. Sales at Sprouts Farmers Market increased 6.9% year over year in 2020, but the chain said that sales growth will decline to low-to-mid-single digits this year. Walmart projects comparable sales to grow by low single-digits in 2021 after 8.6% growth last year.
  • Retail sales in the grocery store industry increased 1.2% in value month over month on an adjusted basis but decreased 0.8% in value year over year on an unadjusted basis in May.
  • The response to laws passed in some jurisdictions requiring the provision of hazard pay to frontline essential workers has not been uniform. Trader Joe’s has boosted pandemic pay for its hourly and non-management employees by $2 an hour at stores nationwide. Two grocery industry trade groups – Northwest Grocery Association and the Washington Food Industry Association – filed a lawsuit against the city of Seattle over a new law that mandates $4 an hour pay raises for grocery store workers. Kroger announced it will close two grocery stores, a Ralphs and a Food 4 Less, both in Long Beach, CA, in response to a local ordinance requiring extra pay for certain grocery employees working during the pandemic.
  • Some grocers are paying employees to be vaccinated against COVID-19. The Aldi grocery chain is providing hourly workers with two hours of pay for each of the two necessary vaccine shots. Aldi, which has 2,000 stores in the US, also said it would help employees pay for the shots. Trader Joe’s and Dollar General are also offering financial incentives while the Instacart grocery delivery service is offering grocery deliverers a $25 stipend, according to National Public Radio.
  • Employment at grocery stores increased 0.8% year over year in April.
  • Food prices are expected to rise 2% to 3% in 2021, according to the US Department of Agriculture The expected increase is slightly higher than the 1.9% increase in 2019 but in line with the 20-year historical average of 2.3%.

May 26, 2021

  • The rising vaccination rate and lifting of restrictions has helped to improve foot traffic in many salons and barber shops, according to The Wall Street Journal. On May 24, the 7-day average for new cases was just over 25,000 – about one-tenth the number seen during the peak in early January. Hospitalizations and deaths have also fallen significantly.  As of May 24, 285 million doses of vaccine had been administered and 39% of the US population was fully vaccinated. On April 19, all Americans over age 16 became eligible to be vaccinated. In May, Pfizer received FDA emergency use authorization for use of its vaccine in children ages 12-15. As vaccination rates have risen, capacity limits on businesses – including salons – are gradually being lifted. As of May 24, 34 states were reopened, and there were no statewide restrictions in place for salons and barbershops, according to The New York Times.
  • Upon reopening, some salons were confused by conflicting guidelines provided by state governments and state boards of cosmetology. Initial guidelines for opening included wearing gloves and masks, allowing only one person in per appointment (including children), temperature checks, limiting services to brief ones like haircuts, spacing work stations six feet apart, sanitizing stations and equipment after each customer, and providing hand sanitizer or alcohol wipes. In May 2021, the Centers for Disease Control and Prevention (CDC) issued new guidelines suggesting fully vaccinated people can resume normal activities without wearing a mask or physically distancing. However, the new policy may create confusion and place the onus of discerning who is vaccinated and who isn’t on the business owner. To avoid such confusion some salon owners have chosen to keep requiring masks.
  • Reopening safely increased salon and barber shop costs as they invested in automated trash receptacles, equipment sterilizing equipment, additional soap and hand sanitizer dispensers, and thermometers. Adhering to distancing guidelines can decrease salon capacity. Time-consuming sanitizing efforts between clients can also reduce the potential volume of business.
  • Salons may need to renegotiate rent/lease terms with landlords. Some salons pay rent based on a percentage of their profit. Some experienced stylists have opted not to return to their pre-pandemic salon workplaces and instead have rented private salon suites to make their customers, and themselves, feel more comfortable.
  • In January, the Professional Beauty Association (PBA) released a study suggesting there’s limited evidence that the salon industry contributes to the spread of COVID-19. In a survey of more than 2,500 salons that have served more than two million clients since reopening, only 0.07% of clients reported testing positive for COVID-19 within 14 days of visiting a salon. The PBA and its members are publicizing the study to help assuage customers’ fears so they return to salons. The industry is hopeful business will rebound more strongly when vaccines are more widely available.
  • In May, salon firm Regis Corporation announced the company posted a net loss of $10.8 million in its fiscal third quarter 2021 ended March 31, 2021. Regis’ third quarter revenue declined 35% as it continued to struggle with the ongoing challenges related to the COVID-19 pandemic. Regis’ brands include Cost Cutters, SuperCuts, and MasterCuts. The company is continuing with its strategy of selling off company-owned stores to franchisees.
  • Salons and barbershops that have seen business drop off during the pandemic may seek relief via the reauthorization of the Paycheck Protection Program (PPP). The PPP was revived with the December passage of the $900 billion COVID-19 Economic Stimulus Relief Act. The legislation includes $300 billion in funding for Small Business Administration (SBA) loans. The most recent round of PPP lets eligible borrowers get a second draw loan. It also simplifies loan forgiveness for loans under $150,000 and makes forgiven loans tax deductible. In February, the Biden administration established a two-week period where the SBA will only accept PPP loan applications from small businesses and nonprofits with fewer than 20 employees, which could benefit small, owner-operated salons. The period began on February 24 and allows small businesses to receive 100% forgivable loans. In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act which included an additional $7.25 billion for PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times.
  • In February, Japanese researchers published a study titled Physics of Fluids that showed talking when workers are standing or leaning over clients (as is common in salons, spas, and some medical services) could increase transmission of viral particles even if both parties are wearing masks. If masks are loose, particles could escape and be pulled downward by gravity, increasing infection risk. Previous research has shown that talking can produce large amounts of viral particles.
  • As clients return to salons, some stylists are helping people who suffered hair loss after having COVID-19. Two to three months after their initial diagnosis, some people experience hair loss. If salons notice an uptick in clients reporting hair loss related to COVID-19, they may research potential remedies or hair styles that can help alleviate the problem.

June 24, 2021

  • Lodging Econometrics forecasts that 691 hotel projects and 81,886 guestrooms will open by the end of 2021, a 2% year-over-year increase in new hotel supply. A 2% increase is also anticipated in 2022, with 963 projects and 111,235 guestrooms forecasted to open.
  • Vehicle production, a driver of demand for some types of hardware, fell 4.6% in the first quarter of 2021, and that’s compared to 2020 when factories had already lost weeks of work when the Covid-19 pandemic caused shutdowns, according to LMC Automotive.
  • Hardware manufacturers serving the auto industry are likely to be negatively impacted as pandemic-related shortages widen. Auto manufacturing firms, which have been forced to slow or stop the production of some models due to a pandemic-related semiconductor shortage, are now facing a natural rubber shortage caused in part by the coronavirus pandemic. Slow shipping has disrupted the delivery of natural rubber, which is a key material in many auto parts and components. Analysts say that reliance on the just-in-time manufacturing process to reduce costs left automakers with limited flexibility when the pandemic hit.
  • Several industry analysts expect new auto sales to increase about 6.9% in 2021. The National Automobile Dealers Association (NADA) expects 2021 sales of 15.5 million. Forecasters at car-shopping web site Edmunds also predicted 2021 sales of 15.5 million. Charlie Chesbrough, senior economist for Cox Automotive, said that Cox expects 2021 sales of 15.7 million. US auto sales in 2020 were 14.5 million, down 15% from 2019. It was the fourth-largest annual decline since at least 1980. Sales in 2019 were 17.1 million. Patrick Manzi, chief economist for NADA, said 2020 was the first time since 2014 that US auto sales failed to top 17 million.

July 8, 2021

  • Distributors are facing shortages of major components needed in air conditioning systems. Supply chain analysts say that copper, steel, aluminum, and ductwork parts are difficult to acquire due to pandemic-related factors including factory closures, shipping delays at ports, slowdowns at distribution centers due to pandemic-related safety measures, and factors not related to the pandemic, like the blockage at the Suez Canal in March. Manufacturers report waits of up to 8 weeks for order fulfillment.
  • A recent computer modeling study of indoor air quality by Honeywell found that mobile HEPA air purifiers can help reduce airborne contaminants by capturing particles as small as 0.3 microns and even smaller. About 97% of small particles were captured by air purifiers, which significantly improved air quality. Speaking created smaller and fewer droplets than a sneeze; yet, when the droplet attaches itself to a particle as an aerosol, dissemination continued as long as a person spoke and traveled approximately 60 feet in the simulation due to HVAC air flow. The closer a source of contaminants is to the air purifier, the higher the purifier’s effectiveness; mobile HEPA air purifiers captured particles as small as 0.3 microns (and smaller).
  • The federal coronavirus relief package passed in March allocates $128 billion for helping K-12 public schools deal with the coronavirus pandemic. Schools will be able to use the funding for a variety of pandemic-related issues, including maintenance, repair, and/or replacement of HVAC and plumbing systems. Initial funding to address school HVAC and ventilation needs went to immediate mitigation measures such as deep cleaning, filter replacement, and personal protective equipment, according to Facility Executive Magazine. Demand for ventilation and HVAC products for schools will rise as additional funding from the American Rescue Plan is released. Distributors are likely to benefit.
  • Demand for HVACR equipment is likely to increase as architecture firms get more requests to upgrade HVAC systems in commercial buildings. High-density filtration is a common request from office building owners, as are ion technology and UV lighting in HVAC systems. Landlords are asking for Minimum Efficiency Reporting Values air filters rated between 11 to 13. The higher the number, the greater the ability for filters to capture small particles. Ion technology in HVACR systems use an ion rod that spins in the ductwork. The rod ionizes the molecules in the air and neutralizes viruses and bacteria. Much of the work on HVACR equipment is being done when building leases turn, which happens every 5, 7, or 10 years, depending on the contract.
  • Guidance issued by The Occupational Safety and Health Administration (OSHA) recommends that employers work with heating, ventilation, and air conditioning (HVAC) professionals to look at ways to improve building ventilation as a way to address the potential hazard of exposure to COVID-19. Specific recommendations include Using HVAC system filters with a Minimum Efficiency Reporting Value (MERV) rating of 13 or higher where feasible and considering the use of portable high-efficiency particulate air (HEPA) fan/filtration systems to increase clean air, especially in higher-risk areas. Distributors are likely to benefit from increased demand for HVAC services.
  • HVAC distributors may benefit from increasing use of heavy-duty filters to block microbes and the installation of systems that use ultraviolet light or electrically charged particles in the ductwork to kill the virus. Many of the methods to reduce pathogens have been around for years, but were geared more to hospitals than commercial buildings. What we’ve learned is that our previous standards of air purification didn’t hold up to the test of the pandemic and those need to evolve accordingly, George Oliver of Johnson Controls said.
  • Carrier Global Corporation, which estimates the total market for indoor air-quality improvements at about $10 billion, has identified $150 million of potential business opportunities for itself. Honeywell International cited a more than $600 million sales pipeline for its “healthy buildings” offerings.
  • The Centers for Disease Control and Prevention acknowledged that the coronavirus can sometimes spread through airborne particles that can "linger in the air for minutes to hours" and among people who are more than 6 feet apart. The CDC cited published reports that demonstrated "limited, uncommon circumstances" in which people with the virus infected others who were more than 6 feet away.

July 17, 2021

  • Supplement usage increased during the initial stages of the coronavirus pandemic and may do so again if the number of new cases continues increasing. The US is averaging about 25,300 new cases per day in mid-July, more than double the 11,300 per day the week of June 22. Cases were increasing in 48 states  - all but Iowa and South Dakota – on July 15. Los Angeles, CA, officials issued an order on July 15 requiring all residents to wear masks in indoor public spaces. Low vaccination rates, the relaxation of mask rules and other precautions, and the swift spread of the more-contagious Delta variant are blamed.
  • A study published in the journal PLOS Medicine, found that vitamin D supplementation may not protect against coronavirus infection. Some experts advocated the use of vitamin D at the beginning of the coronavirus pandemic because several observational studies showed that populations who were deficient in vitamin D were also at higher risk of experiencing adverse symptoms from COVID-19.
  • The Centers for Disease Control and Prevention said that cleaning once a day is usually enough to minimize the chance of coronavirus transmission in most settings. Health supplement stores are likely to benefit if the guidance results in lower pandemic-related cleaning costs. The CDC did identify one appropriate situation for deep cleaning: an indoor environment where a case of COVID-19 had been confirmed within the past 24 hours.
  • All 50 states have either opened coronavirus vaccinations to everyone eligible under US Food and Drug Administration emergency use authorizations, or have announced when they plan to do so. Demand for supplements, which has increased during the pandemic as many consumers hoped that they may help ward off COVID-19, may decline as a result.
  • Researchers from the Cleveland Clinic who examined the effects of vitamin C and zinc on 214 people who were recovering from COVID-19 found that even at high doses, the supplements didn't help reduce the duration of COVID-19 symptoms. Many Americans rushed to buy supplements when the COVID-19 pandemic first hit the US. Vitamin C sales increased 146% during the first week of March, according to the New York Times. Zinc sales increased 255%.
  • Health supplement stores may struggle to maintain adequate inventory because product manufacturers are having difficulty acquiring packaging materials. Shortages are occurring due to increasing demand for supplements during the COVID-19 pandemic and to competition for packaging coming from the healthcare industry, according to panelists who participated in a webcast by industry news site Nutritional Outlook. Packaging costs have also increased. "...what we’re seeing is that manufacturers are beyond capacity. It’s going to take some time for these manufacturers to be able to build their capacity. Just to give some perspective, for a common round packer, we’re seeing delays out to February 2021,” said Jeohvan Montoya, director of supply chain management for contract manufacturer Lief Labs.
  • A survey by the Council for Responsible Nutrition revealed that more than two in five (43%) of dietary supplement users changed their supplement routines since the start of the pandemic. Among those who altered their regimens due to COVID-19, 91% reported increasing their supplement intake, which included adding new supplements to their existing routines (46%); taking the same supplements more regularly (25%); or increasing dose(s) (22%).
  • The FTC continues to warn companies about making claims that their products and/or therapies can treat or prevent COVID-19. The agency has received hundreds of reports of consumers purchasing products that lack scientific evidence showing that they have any impact on human health outcomes related to the virus.

June 16, 2021

  • Riding the wave of an improving economy while navigating stock market volatility and inflation, hedge funds notched their strongest January-to-May performance in 25 years, according to Hedge Fund Research (HFR). The HFR Fund Weighted Composite Index, a global measure of about 1,400 single-manager hedge funds, was up nearly 10% in the first five months of 2021 compared to the same period in 2020. Event driven hedge fund managers led the growth trend with gains of 11.8%. Commodities-focused managers helped drive an 11.2% rise in equity hedge fund performance. Macro funds – which wager on macroeconomic trends – were up 9% in the first four months of the year partly driven by commodities-focused hedge fund strategies which grew 11.2%.
  • Some commodity hedge fund managers are bullish on oil for 2021 amid a rebounding global economy and restrained output by major oil producers, according to Reuters. In early June, hedge fund managers increased their positions on petroleum to pre-pandemic levels, purchasing the equivalent of 52 million barrels in the six most important petroleum futures and options contracts. As oil prices collapsed in the early months of the pandemic, crude production slowed and rig counts fell. As consumption of petroleum products has gradually ticked upward, production by OPEC+ nations and US shale players have not increased in step with rising demand, which has pushed oil prices higher.
  • As the world economy continues to recover, hedge fund and private equity fund insiders suggest private debt will be a fast-growing asset class. In a recent report by Preqin, assets under management in private debt will see a compound annual growth rate of more than 11% over the next five years, growing from $848 billion to more than $1.4 trillion. The growth is expected to be fueled by investors seeking alternative sources of yield, and tighter lending standards among banks. Direct lending funds are well-positioned to help businesses during the recovery because they have a stockpile of $1.5 trillion in cash, according to Preqin estimates. In a recent Preqin survey of private fund managers, more than 60% expect private debt funds to play a bigger role in the debt lending arena.
  • Hedge fund managers are expected to more fully embrace environment, social, and corporate governance (ESG) investment principles in 2021, according to Agecroft Partners. The COVID-19 pandemic shed a bright light on existing social and economic inequities which is expected to drive more consideration of ESG issues. Pension funds, endowment foundations, and sovereign wealth funds account for nearly half of hedge fund industry assets, and they are increasingly demanding EGS principals from investments. Climate change awareness, in the form of renewable energy, is a key area of ESG investment focus. Investors are also demanding greater diversity both among the workforces of the companies they invest in, but also the workforces of fund managers.
  • Hedge funds are “cautiously optimistic” regarding growth prospects for 2021, according to the recent Global Hedge Fund Benchmark Survey by the Alternative Investment Management Association (AIMA) and law firms Simmons & Simmons and Seward & Kissel. More than 70% of hedge fund managers surveyed said they had a positive confidence level. Amid strong hedge fund interest among investors, funds’ inflows are expected to remain positive. As COVID-19 precautions persist, investors are expected to be more comfortable working with hedge fund managers with whom they have past business relationships, which could disadvantage newer funds and managers. The report also suggests hedge fund firms are likely to play an important role in the global COVID-19 economic recovery.
  • Some investors may look to hedge funds as a diversification tool to protect against potential inflation and higher interest rates as global economies recover from the pandemic, according to K2 Advisors, the hedge fund investing arm of Franklin Templeton. Improving vaccine distribution and lower COVID-19 infection rates could significantly boost consumer and corporate spending which could spark inflation, and create a knock-on effect for equities and bonds. Hedge funds may create opportunities for investors by going long on investments that stand to benefit from higher borrowing costs while shorting those markets hurt by them.

July 8, 2021

  • Some businesses that took Small Business Administration (SBA) Paycheck Protection Program (PPP) loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that could mean a deadline in September.
  • The SBA hopes to further simplify its Paycheck Protection Program loan forgiveness process for loans in the $150,000 to $2 million range, according to SBA Administrator Isabel Guzman. While loans of $150,000 and under have repeatedly seen their forgiveness process streamlined, and loans of $2 million and up are held up for additional scrutiny, the agency is hoping to speed up the middle tier.
  • The SBA stopped accepting PPP loan guarantee applications on May 31. About 96% of PPP loans made in 2021 went to small businesses with fewer than 20 employees, according to the SBA. The SBA said that it has approved roughly 3.3 million PPP loan forgiveness applications as of late May. That means that roughly 69.5% of the more than 5.2 million PPP loans made in 2020 have been forgiven in whole or in part, according to SBA data. About $69.2 billion in loans over $1 million are “in process,” compared to about $12.3 billion for loans under that amount, suggesting that some larger PPP borrowers are not faring as well in the forgiveness process.
  • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
  • The trucking industry helped sustain states' gas tax revenue during the pandemic, according to the American Trucking Association (ATA). The industry had “pockets of weakness” in 2020, such as tank trucks that haul gasoline, but freight activity in many sectors was strong. Trucks were especially busy hauling groceries and home improvement goods. “Overall, we’ve been buying,” said ATA chief economist Bob Costello. “We may change what we’re eating and where we’re eating, but we’re still eating. It has to do with consumption of retail goods, usually bought online, but it also is going to be related to better construction activity for home building as well as remodeling. That was strong last year.”
  • The $900 billion coronavirus relief package signed into law in late December 2020 includes $10 billion for state highways. Industry experts say that the funding is intended to help offset severe losses in state transportation revenues due to reduced vehicle travel during the pandemic.
  • Receipts for the Highway Trust Fund decreased just 2.1% year over year during fiscal 2020, which ended on September 30, 2020. Gross gasoline tax receipts were down 2.7%, gross diesel fuel receipts were down 1.7%, and the total receipts from the three trucking excise taxes were down 3.2%. Some industry experts note that gasoline production decreased 11% during fiscal 2020, and they expect a downward revision to gasoline tax receipts in the future. More than 80% of the Fund comes from the gasoline tax.
  • Employment in the highway, street, and bridge construction industry was unchanged year over year in May.
  • Several states have increased gas taxes to make up for sudden shortfalls in revenue. New Jersey raised its gas tax from 30.9 cents to 40.2 cents for gasoline and from 34.9 cents to 44.2 cents for diesel fuel. Other recent increases have included Virginia (5 cents), Nebraska (3.9 cents), California (3.2 cents), South Carolina (2 cents) and Illinois (0.7 cents), and Alabama (2 cents).
  • The American Association of State Highway and Transportation Officials expect pandemic-related state transportation revenue losses to be recovered by 2025.

July 16, 2021

  • Consumers are not returning to pre COVID-19 pandemic shopping behavior, according to  eMarketer. The market research firm predicts that “Even as stores reopen and brick-and-mortar sales rebound, we forecast that E-commerce will lose just a 0.1% share of total retail sales in 2021, before gaining more than 1 percentage point each year through 2024. Stores with both online and bricks-and-mortar sales channels may benefit most from the new shopping behavior.
  • The Centers for Disease Control and Prevention has issued guidance stating that fully vaccinated people — those who have received their final Covid-19 vaccination at least two weeks ago — no longer need to wear masks outdoors or in most indoor settings. Toy stores are likely to benefit from rising foot traffic due to the relaxed restrictions. Experts note, however, that interpretation of the guidance is likely to vary by state.
  • Financial and investing advice company The Motley Fool says that the pandemic had largely killed the in-store experience for independent bricks-and mortar toy shops. Many don't have enough square footage to allow for normal capacity, so they've been forced to limit customers, and bringing a child into a store is too risky for some parents. Many Americans who have seen their income decline during the pandemic can't afford to pay more for toys and games that may be cheaper online.
  • About 73% of consumers who typically visited shopping centers before the pandemic intend to return again after they have been vaccinated, according to a global survey by IBM's Institute for Business Value. The biggest categories that will see shifts toward in-person shopping are toys, games and hobbies, at 121%, and apparel, footwear and accessories, at 76%.
  • Brand management company WHP Global said that it has acquired a controlling interest in Tru Kids, the parent company of the Toys R Us, Babies R Us, and Geoffrey the Giraffe brands. WHP Global reportedly plans to open Toys R Us stores ahead of the 2021 holiday shopping season. The two Toys R Us stores that opened in November 2019 as part of an attempted US comeback by the iconic toy chain were closed in January. Corporate executives said of the closings that COVID-19 had put the proverbial "nail in the coffin."
  • Sales at sporting goods, hobby, musical instrument, and book stores decreased 0.8% month over month on an adjusted basis but increased 41% year over year in May. Sales increased 55.2% year over year for the first five months of 2021. Year-over-year figures may be distorted by the large, pandemic-related drop in sales during the same periods in 2020.

June 22, 2021

  • Retail sales for building material, garden equipment, and supplies dealers decreased 6% in value month over month on an adjusted basis in May but were up 21.1% in value year over year on an unadjusted basis during the first five months of 2021. Sales had increased 12.1% in value month over month on an adjusted basis and 32.4% in value year over year on an unadjusted basis in March.
  • Some analysts expect consumers to embark on bigger, pricier home improvement projects as the pandemic wanes. Consumers spent freely on home improvement projects they could handle themselves, like setting up a new office in the house or repainting a teen’s bedroom so it looks better on a Zoom call, but analysts expect them to gravitate to larger, more involved projects like bathroom remodels. Home Center chain Lowes will cater to pro customers by setting up “Pro Zone” areas with prominent signage. These are stocked with the grab-and-go items pros frequently buy and convenience racks with items such as painkillers, snacks, and energy drinks. Lowe’s has added such sections to 95% of its 1,734 US stores. Lowe’s has also set up dedicated parking spots for these customers, who often need to load bigger items into their vehicles. There are also phone-charging stations and a dedicated checkout area. “Time is money for (pros), and they want to get in and out of the store quickly,” Lowe’s executive vice president of merchandising Bill Boltz said.
  • Lowe's said that fourth-quarter 2020 same-store sales climbed 28.1%, as consumers spent more on home projects during the pandemic. The company warned, however, that spending on DIY projects and home improvement could ease as consumers resume normal activities post-pandemic. Chief Financial Officer Dave Denton laid out three scenarios for a robust, moderate or weak market. In a robust market, the retailer's outlook for 2021 anticipates a 5% to 7% drop in demand for the home improvement sector on a mix adjusted basis. In a moderate and weak market, demand would likely drop respectively by 7% to 9% and 10%.
  • Home Depot officials say that sales may be unchanged year over year in 2021 but declined to offer more specific guidance, saying there was still too much uncertainty. Profit margin will continue to be pressured this year by rising transportation costs, Chief Financial Officer Richard McPhail said on a call with analysts. Increased spending on infrastructure and more shoplifting will also weigh on profitability. The cost of sales has been increasing faster than revenue growth due to pandemic-related safety precautions.
  • Sales of previously-owned homes decreased 2.7% month over month but were up 33.9% year over year in April, according to the National Association of Realtors. It was the third straight month-over-month decrease. The year-over-year change is likely to have been affected by the large decrease in sales during April 2020 due to the coronavirus pandemic, and may not be indicative of future activity. Sales increased 20% year over year for the first four months of 2021, however.
  • Employment in the home center and hardware store industry increased 0.4% year over year in April.
  • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, was unchanged at 83 in May. The Index was at 82 in March and 84 in February. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. The HMI index gauging current sales conditions held steady at 88, and the gauge charting sales expectations in the next six months rose one point to 81. The component measuring traffic of prospective buyers fell one point to 73.

July 5, 2021

  • Healthcare facilities with 10 or more employees must conduct a hazard assessment and have a written plan to reduce coronavirus spread, according to new, temporary standards issued in mid-June by the federal Occupational Safety and Health Administration. Employers must also supply some employees with N95 respirators or other personal protective equipment. The standard also requires covered employers to provide workers with paid time off to get vaccinated and to recover from any side effects of the vaccination. Covered employees who have the virus or who may be contagious must work remotely or otherwise be separated from other workers if possible, or be given paid time off up to $1,400 per week. For most businesses with fewer than 500 employees, paid leave may be reimbursed through tax credits in the American Rescue Plan.
  • The Centers for Medicare and Medicaid Services (CMS) has begun recoupment of accelerated and advance Medicare payments from providers, including home healthcare services, that borrowed the emergency funds one year ago to battle COVID-19. An accelerated or advance payment is a payment from CMS that is intended to provide necessary funds when there is a disruption in claims submission and/or claims processing. CMS can also offer these payments in circumstances such as national emergencies or natural disasters in order to accelerate cash flow to the impacted health care providers and suppliers. Recipients were originally supposed to start paying back pandemic-related payments in August 2020, but CMS extended the repayment period until one year after the funds were loaned. CMS will withhold 25% of Medicare payments for 11 months or until the amount has been paid back. If the advanced payments have not been received by that point, CMS will withhold 50% of Medicare payments for up to six months and then issue a demand letter for the balance.
  • The home healthcare industry may fare better than its post-acute care counterparts to repay advance payments, according to Sherill Mason, principal at Mason Advisors, which provides strategic planning and operations analysis to healthcare providers. “The sector is significantly healthier financially than their colleagues in the skilled nursing industry, where census has not rebounded,” Mason has said.
  • The US Department of Health & Human Services (HHS) has renewed the Public Health Emergency (PHE) declaration for COVID 19 for another 90 days, beginning on April 21 (the date the PHE was previously scheduled to expire) and extending through July 19, 2021. Key regulatory flexibilities and emergency funding sources that are linked to the PHE include but are not limited to 1135 Waivers; Medicare and Medicaid rules regarding Medicare coverage of telehealth, supervision of medical residents, Medicare and Medicaid diagnostic testing, provider-based hospital departments, and the Medicare Shared Savings Program; flexibilities and funding sources established via the Families First Coronavirus Response Act and the CARES Act; and relaxation of certain federal HIPAA privacy and security rules. Providers should remember that HHS retains the discretion to terminate the PHE at any time.
  • A coalition dedicated to advancing home-based care was formed in early March. The Moving Health Home coalition says that COVID-19 has accelerated the need for more home-based care advocacy. COVID-19 has proven how a wide range of conditions can — and should — be treated in the home, the group adds. Reimbursement models and the culture around health care should be adjusted to fit that reality. Founding organizations include Amazon Care, Landmark Health, Signify Health, DispatchHealth, Elara Caring, Intermountain Healthcare, Home Instead Senior Care, and Ascension.
  • Home healthcare industry employment increased 3.2% year over year in June, according to the US Bureau of Labor Statistics. Home healthcare services saw a surge in demand in the wake of COVID-19 due to concerns about outpatient visits and rising infections and deaths in nursing homes.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.

June 22, 2021

  • Retail sales for the furniture and home furnishings industry decreased 2.9% in value month over month on an adjusted basis in April but increased 49.5% in value year over year on an unadjusted basis during the first five months of 2021. Sales had increased 5.9% in value month over month on an adjusted basis and 49.6% in value year over year on an unadjusted basis in March.
  • Real disposable income, an indicator of demand for discretionary purchases, decreased 15.1% in April following a 22.7% increase in March. The decrease in personal income in April primarily reflected a decrease in government social benefits. Payments associated with the American Rescue Plan Act of 2021 (which was enacted on March 11, 2021) continued but were at a lower level than in March. Consumer spending decreased 0.1% in April. Spending and income are expected to rebound in the coming months as more people become vaccinated.
  • Many analysts expect a wave of discretionary expenditures on items like home furnishings when the pandemic wanes. Bloomberg Economics estimates that consumers have amassed about $1.7 trillion in savings since the beginning of the pandemic through January. That’s being bolstered by a new round of stimulus payments. Consumer spending during Q2 and Q3 2021 is likely to be the strongest such period in at least 70 years, according to economists at financial services firm Wells Fargo.
  • The University of Michigan’s consumer sentiment index, a measure of consumer confidence, decreased to 82.9 in May from a 13-month high of 88.3 in April. Analysts say that the decline in consumer sentiment was triggered by sudden worries about inflation. Consumer prices have surged this year and jumped more than 4% in the past 12 months, a 13-year high. The Federal Reserve, the nation’s inflation watchdog, maintains that prices will come back down once the economy has mostly recovered from the coronavirus pandemic and pent-up demand is satisfied.
  • Employment in the home furnishings store industry increased 99% from the  pandemic-related low of April 2020 but was down 8.4% from the pre-pandemic month of April 2019.

July 5, 2021

  • Four federal lawmakers are seeking answers from multinational investor-owned healthcare services company Tenet Healthcare about its use of federal taxpayer funds, including grants and loans from the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The lawmakers questioned whether Dallas-based Tenet used the funds "to enrich its executives and shareholders rather than meet the needs of its healthcare providers and patients during the COVID-19 pandemic," in a letter to the system's Executive Chair and CEO, Ronald Rittenmeyer. Tenet has received more than $936 million in grants from the Provider Relief Fund and some $1.5 billion more in relief from Medicare Advance Payments and payroll tax match deferrals, according to the lawmakers. They also noted that despite the pandemic, Tenet reported annual earnings of more than $3.1 billion and available credit of $2.9 billion in 2020.
  • Pandemic-related payments to the largest hospital chains may have accelerated their acquisition plans by enabling them to purchase weakened competitors. CommonSpirit Health, a Catholic nonprofit system that is one of the biggest hospital networks , received well over $1 billion in federal aid to counter any financial losses caused by the shutdowns of lucrative elective surgeries and higher COVID-related costs. One of its divisions merged with Virginia Mason health system in Seattle in a move that strengthened CommonSpirit’s sway in Washington state. It also acquired a small hospital network in Arizona and helped start a company to analyze patient data across 40 states. Congress provided capital to hospitals that did not need it, according to Zack Cooper, a Yale health economist. “Regulators should really be looking at the transactions occurring,” he said.
  • The US Department of Health and Human Services (HHS) announced the availability of nearly $1 billion to strengthen COVID-19 response efforts and increase vaccinations in rural communities. The Health Resources and Services Administration, a part of HHS, will increase the number of vaccines sent to rural communities, expand testing and other COVID-19 prevention services, and work to increase vaccine confidence by empowering trusted local voices with additional funding for outreach efforts in underserved communities.
  • Employment at hospitals increased 1.2% year over year in June but was down 0.9% compared to June 2019, according to the US Bureau of Labor Statistics.
  • Hospitals will be stretched to the limit by the oncoming surge of rescheduled surgeries, according to Johns Hopkins University researchers. "Even if patient demand was diminished by 50 percent, which is a tremendous number, then there's still going to be a backlog of almost 400,000 cases in orthopedics" alone, said Dr. Amit Jain, a spinal surgeon at Hopkins. New COVID-19 safety protocols are also likely to over-extend hospitals, the researchers said. Waiting rooms will have to be kept at a lower capacity to ensure social distancing.

June 25, 2021

  • More than 2 million people passed through US airport security checkpoints on June 11, according to the federal Transportation Security Administration (TSA). It was the first time since early March 2020 that that level was reached. Checkpoint traffic was 74% of the volume compared to the same day in 2019, but the 2.03 million figure was 1.5 million more travelers than the same day in 2020, according to the TSA.
  • Accommodation industry revenue increased 5.8% in Q1 from the prior quarter but decreased 24.2% year over year.
  • The California legislature passed a bill which requires reopening hospitality companies to offer jobs first to employees who had their jobs at least six months prior to and were laid off because of the COVID-19 pandemic. The bill requires all hospitality companies to inform former employees as to when their jobs or positions will be available after the economic crisis. The bill now advances to Governor Gavin Newsom's office.
  • Advertising and search engine firm Google has introduced a new policy on its travel platform Google Travel in which hotels and travel companies can now appear for free in booking links, and won't have to pay the search engine for the transactions carried out by travelers. Analysts say that the move is intended to boost the tourism industry when the pandemic begins to wane.
  • Employment in the hotels and motels industry increased 30% year over year in April but was down 26.7% compared to the pre-pandemic month of April 2019.

July 5, 2021

  • Strong appliance sales growth may be weakening along with the pandemic. Sales at electronics and appliance stores decreased 3.4% in value month over month in May, according to the US Census Bureau. Sales had increased 26.1% in value year over year during the first four months of 2021.
  • Demand for more hygienic appliances may decline now that the Centers for Disease Control and Prevention (CDC) has acknowledged that the risk of catching the coronavirus from surfaces is low. Researchers reported early during the pandemic that the virus could survive for days on plastic or stainless steel, and the CDC advised that if someone touched one of these contaminated surfaces and then touched their eyes, nose or mouth, they could become infected. Health experts say that revised CDC guidance reflects evolving data on transmission throughout the pandemic.
  • Appliance manufacturers have been putting more focus on hygiene since the beginning of the coronavirus pandemic. Manufacturers including LG Electronics Whirlpool claim that some of their products actively remove germs and allergens from their surfaces. Some of LG’s new refrigerators, for example, come with sterilizing ultraviolet lights fitted inside them. Whirlpool has launched a new line of washing machines that come with built-in heating units that are designed to kill germs in laundry, according to The Wall Street Journal. “All of our product development now is being done through the lens of hygiene,” Mark Choe, a senior vice president at Samsung’s digital appliances business division, told The Wall Street Journal.
  • United Microelectronics Corporation (UMC), the world’s fourth-largest contract chipmaker, is expanding its capacity to produce "mature technology" chips like those used in many household appliances. A pandemic-related shortage of semiconductors has slowed production of auto parts, leading to shortages. UMC said it would add capacity for manufacturing 20,000 wafers a month at 28 nanometers, one of the process technology nodes worst-hit by the global chip shortage, at an existing fabrication plant.
  • About 55% of consumers who have purchased an appliance during the pandemic did so online, according to the Association of Home Appliance Manufacturers. It was the first online appliance purchase for 70% of those consumers.
  • Household appliance manufacturing is among the many industries suffering from pandemic-related input shortages. Manufacturers cut back production when the pandemic started in March 2020, according to Scott Paul, president of the Alliance for American Manufacturing. They also cut raw material purchases in anticipation of declining consumer demand. Demand for goods did plunge in April 2020 but rebounded steadily, fed by households that have held up well during the pandemic. Manufacturers are now scrambling to restock raw materials in response to unexpectedly high demand. Experts warn, however, that demand could shift back to services in the summer as more Americans get vaccinated. Manufacturing could slow as a result.
  • The federal Equal Employment Opportunity Commission said that employees may be barred from the workplace if they refuse the COVID-19 vaccine. "Requiring a vaccine is a health and safety work rule, and employers can do that," said Dorit Reiss, a professor at the University of California Hastings College of Law. There are, however, some exceptions to a blanket requirement. A collective bargaining agreement may require negotiating with a union before mandating a vaccine. The Americans with Disabilities Act allows workers who don't want to be vaccinated for medical reasons to request an exemption.
  • New single-family home sales decreased 5.9% month over month but in