Cautious Optimism About the Future, Despite the Uncertainty Ahead

More than a year into the COVID-19 pandemic that has wreaked havoc on a national, statewide and local scale, some economic forecasters say there is a light at the end of the tunnel.

Speaking at the 9^th annual Economic Forecast sponsored by the North Central Massachusetts Chamber of Commerce, Dr. Bo Zhao, a senior economist with the Federal Reserve Bank of Boston, said he is hopeful that continued public health measures, and a robust vaccine rollout will help spur an economic revitalization.

“Despite high uncertainty ahead, there are several reasons for cautious optimism about the medium-term economic outlook, including effective vaccines, favorable financial conditions, rising asset prices and a resilient housing market,’’ Zhao said.

Simon Anderson, an international futurist speaker, highlighted segments of the economy that he thinks will see significant growth post-pandemic, including local experiences and products like outdoor recreation, farms, restaurants, and breweries, all of which could be a boon for North Central Massachusetts.

“People are going to want to go to the apple orchards, get some freshly made cider, pick some apples, go to a craft brewery, just be with some friends in person, go to a restaurant, shop at a local store in their neighborhood,’’ Anderson said. “I think this is going to drive up demand for local experience, which is going to be just great for small businesses.’’

That demand cannot come soon enough for local business hit hardest by the pandemic. Zhao said in Greater Worcester, only trade/transportation/utilities maintained a similar level of employment during the pandemic.

Leisure and hospitality, which includes restaurants, movies and hotels, had the largest one-year drop in job loss among all sectors at 24.5 percent. He said those types of jobs cannot be done remotely and were most impacted by government restrictions.

But there are positive signs, Anderson said, such as the number of applications for new restaurants.

According to the National Restaurant Association, COVID forced the closure of 110,000 eateries, representing 1 in 6 establishments in the United States. But in just the first two months of 2021, 50,000 new applications for food establishments were submitted for new restaurants, Anderson said.

“Those new businesses will be so much more adaptive and ready for challenges because of what they’ve seen and been through,’’ Anderson said.

This year’s Economic Forecast, held virtually due to the ongoing pandemic, is held annually to give the community and business leaders a look into the economic future of the region. Video of the webinar is available for replay on the chamber’s website.

Chamber President and Chief Executive Officer Roy Nascimento welcomed attendees to the webinar, which he said is traditionally one of the signature business events of the year.

As March 2021 marked the one-year point of the pandemic, Nascimento said it remains critically important for the business community to stay informed and connected.

Since the start of the pandemic, the chamber has held over 100 online programs designed to inform, educate and connect members.

Friday’s webinar was intended to provide insight into the economy and what post-COVID life will look like. Lauren Howe, principal and owner of empHowered PR LLC in Leominster, served as master of ceremonies, introducing the speakers and reading questions from attendees submitted online.

Anderson highlighted segments of the economy that could see significant growth post-pandemic. One of his key “Emerging Opportunities’’ focused on how businesses could capitalize on the shift to remote to build their business and benefit consumers.

Telehealth, Anderson said, has been a true success story for patients and doctors alike.

“You have a lot of people now that can access their health care via zoom, via Facetime or online,’’ he said. “That’s a really incredibly positive trend because a lot of people have transportation challenges and mobility challenges and miss appointments for their doctor because they can’t get there.’’

Anderson said the shift to telehealth and also remote education would have taken a lot longer if it wasn’t forced.

“It was very difficult in the beginning, but I think we will see a lot of positive outcomes going forward,’’ he said.

Anderson said e-commerce has been another bright spot that will continue to grow. In 2020, there was a 45 percent increase in e-commerce compared to the traditional 15 percent spike.

Retailers have adapted through curbside and delivery, allowing them to expand their customer base.

“Even though we were hit so hard with this pandemic with a lot of small businesses especially, I truly believe we are going to come back a lot stronger,’’ Anderson said.

And with more people working from home and traveling less, there will be more demand for local experiences and products, Anderson said. Another benefit of people working from home is that local businesses will be able to cast a wider net for employees who may not want to commute or move to the region.

Other emerging opportunities, according to Anderson, are the electrification of transportation; advancements in automation; and blockchain tech and digital currency.

According to Zhao, another positive has been the housing market.

He said historically low interest rates, a strong stock market and low supply created an upward pressure in the market.

The Chamber will be holding its annual Real Estate Summit on May 18 this year. This event, a collaboration between the Chamber and the North Central Massachusetts Association of Realtors, will provide an in-depth look at the real estate market in the region.

All in all, after a decline in 2020, the U.S. economy is expected to have a strong recovery in 2021, Zhao said. Unemployment projections also show positive trends, he said, however they could still remain higher than pre-pandemic levels.

He is also hopeful that the recovery from this crisis will be faster than previous downturns because it has been driven by a public health crisis and not economic triggers.

“People should feel cautiously optimistic, but we have to keep in mind that this is a brand-new virus and there is still a lot of uncertainty,’’ Zhao said.

To learn more about the North Central Massachusetts Chamber of Commerce, please visit www.NorthCentralMass.com or contact the Chamber at 978.353.7600.