NC economist: With COVID-19 vaccine in reach, 2021 looks promising
Posted November 27, 2020 12:06 p.m. EST
Updated November 27, 2020 1:30 p.m. EST
As 2020 comes to a close, business experts are making predictions about the state of the economy in 2021. Some believe we're in for a COVID-19 surge due to holiday gatherings, which could weaken the economy. Others are optimistic.
Mike Walden, an economics professor at N.C. State University, believes 2021 will be a good year and that the economy will recover from the pandemic recession.
On the national level, Walden expects a bumpy next few months as many states, including North Carolina, fight high COVID-19 numbers. In the spring, when the coronavirus vaccine is expected be widely distributed to the public, he believes it will trigger a rebound. North Carolina may be particularly well positioned, he said.
"I think people and businesses are going to look at some of the big metro areas where densities are super high and say, maybe we need to go to a more mid-level city," Walden said. "Raleigh, Charlotte, the Triad, Asheville and Wilmington are all great places. So I think the state could actually come out of this with a better image and a better growth rate prior to the pandemic."
When it comes to jobs and hiring, Walden believes it could take two years to return to a 4% level of unemployment. He also expects some low-paid jobs that depend heavily on face-to-face contact could be diminished for good, because they could become a liability if there were to be another pandemic.
Walden predicts such layoffs will be particularly likely in the hotel industry and in meat processing factories, where positions could be replaced with robots, something that is already happening around the world.
"I think many businesses are looking at those workers," Walden said. "They’re replacing maids and other workers with machinery and robots ... I think restaurants are the same way. I don’t think restaurants are going to ever be the same. I think they’re going to try to replace some of their work staff with machinery."
Another stimulus package from the government could help the economy, Walden said, along with re-training for certain jobs.
"I think now we need to focus on those people who are really having trouble, and I think secondly we need to have some work re-training component to that," Walden said. "I think that would get bipartisan support."