Each week the GREATER MSP Intelligence Team will share with you our latest insights on the economic impact of COVID-19 on the Greater MSP region. We’re listening, monitoring, and tracking data and insights from a global, national, and regional lens.
This week we’re focused on what expert economists are reporting on the macro impacts of COVID-19 and translating what that means for the Greater MSP region. Here’s what we know from monitoring Moody’s Analytics, the Brookings Institute, and others.
The coronavirus is causing an unprecedented shock to the global economy.
The shock will be felt most intensely in the first half of this year but will lead to contraction for the remainder of 2020 before picking up in 2021. Economic output forecasts for the U.S. economy are being downgraded significantly for Q2 2020, due in large to: (1) the reduction in services consumption resulting from stay-at-home and shelter-in-place mandates, (2) reduced building activity, and (3) reduced manufacturing production due to reduced demands for goods, supply chain disruptions, and temporary plant shutdowns. The impact to economic output is difficult to forecast at this point and experts are quick to caveat that we do not yet know the full extent of the impact and the expected length of the recovery.
Some regions will be hit harder than others.
While COVID-19 is now in every state in the U.S., some regions have higher exposure and vulnerabilities than others. Regions that have a high dependency on leisure and hospitality industries, like Las Vegas, will feel the economic shock of stay-at-home mandates more acutely than more diversified economies. Local and state policies to limit the spread of COVID-19 and to provide support to workers and businesses are also influencing variability of regional disruptions.
Large metros will be hit the hardest.
Large metros, particularly those with high population density and globally connected, have higher rates of the spread of COVID-19 and are implementing stricter stay-at-home policies. High-density regions with significant global connectivity are primarily coastal metros like New York, San Francisco, and Miami.
What does this mean for the Greater MSP region?
Our diverse economy will limit the regional economic impact, but we won’t go unscathed.
The Greater MSP region’s diverse mix of industries helps protect us from the short-term disruptions to hard-hit industries. In coordination with Moody’s Analytics, the Brookings Institute ranked regions by vulnerability measuring regional dependency on high-risk industries, including mining, transportation, employment services, travel arrangements, and leisure & hospitality.
Our research finds that there are 300,000 jobs in high-risk industries in the Greater MSP region, accounting for 14.2% of total metro employment. This share of jobs in high-risk industries places the Greater MSP region below the national share (16.5%) and below nearly all of our peer regions.
Click to view the full list of high-Risk jobs
About GREATER MSP
GREATER MSP is the economic development partnership for the 15-county Minneapolis Saint Paul region. Over 300 leading businesses, universities, cities, counties, philanthropies, and others are working together to accelerate the competitiveness of the regional economy and drive inclusive economic growth through job creation, capital investment and the execution of strategic initiatives.