Thomas Traynor is a leader in Dayton’s business education scene. Traynor, dean of the Raj Soin College of Business at Wright State University, has been with Wright State since 1988 and was named a professor of economics in 2003. He chaired the university’s department of economics from 1998 to 2001, and again from 2010 to 2016.
Traynor recently spoke with the DBJ regarding the local economy and more.
How would you assess the Dayton-area economy going into 2021?
In a weakened state. The only two industries to have shown growth are: Providers of cleaning and virus protection services; and financial services (banking and other investment services, real estate, and insurance)
What concerns you the most?
I am most excited about the end of the pandemic! That might sound trite, but when the region and nation can return to all economic activities that they wish, the recovery should become quite strong. The primary economic support of a strong recovery should be the healthy financial position of most households together with strong pent-up demand.
In the near-term, the economy will continue as it has over the past several months. Nearly all industries will continue to experience lower demand, and some will continue to experience supply chain problems as the pandemic continues to impact production and logistics. These problems result from Covid-19 illnesses and the precautionary actions taken by people. As in the recent past, when Covid-19 cases, hospitalizations, and deaths rise, economic activity will decline and unemployment will rise.
In the early months of 2021, several forces will influence the regional economy, including: Health experts predict that the spread of Covid-19 through January will expand, which will hurt the regional economy; the federal Covid relief package will help the regional economy; and vaccine distributions, given to the population gradually and by the proscribed priorities, will slowly help the regional economy
The industries that have suffered the largest declines in employment are retail stores, leisure activities, state government and local government. These industries will continue to struggle into the New Year. The industries that have had the strongest years are financial services and business support services that provide Coronavirus protective services.
As mentioned above, a strong recovery will not arrive until the pandemic is behind us enough so the economy can function normally. The disease will still present but enough people have immunity for its transmission to be minimal and not capable of a meaningful growth rate. This is due to the large proportion of households that are in strong financial shape.
It is very important to recognize that a small, but significant, number of households and businesses will continue to struggle financially until the end of the pandemic and beyond. They are dependent on retail, restaurant/leisure, and state and local government activity. Many in these industries are low-wage workers who did not have much savings when the pandemic hit. Moreover, job positions in nearly every industry and the economy overall are down, making the transition to a new industry impossible in aggregate. Many businesses in these industries have accumulated substantial debt that may take significant time before full recovery can occur. Federal Covid relief has provided significant meaningful support for these significantly impacted groups, but they will not be in the same level of economic health as the rest of the economy.
What industries do you expect to see success this year and which ones may be hindered?
Every industry harmed by the pandemic (virtually all industries) should experience significant improvements to performance, but the improvements will not be significant until the pandemic has subsided.
What is the best thing about the Dayton economy?
I do not have anything original to say – the region’s resilience stands out. The pandemic is only the latest of many challenges faced by the region in recent years. How many people in the area remember how glad they felt to put 2019 behind them at this time last year?
The original story is posted at bizjournals.com