MEMPHIS, Tenn. — More businesses have reopened as Shelby County moves into its second week of Phase Two in the back-to-business plan.
Memphis economist Dr. John Gnuschke said the key to the community’s economic recovery will be a customer’s comfort level to revisit businesses again.
“Memphis has a very low instances of coronavirus but it’s not zero,” said Dr. Gnuschke. “The risk is not zero so people who are apprehensive about the coronavirus and particularly sensitive to it are not going to participant in this recovery.”
But he said the city is facing other hurdles in the process.
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According to Dr. Gnuschke, one in four people were already living in poverty before the pandemic started in March.
He said the combination of high poverty and now high unemployment will slow down the recovery rate.
“You can see where the poverty problem is going to get bigger not smaller, and it’s going to continue to be big until we get the economy back in full swing and that can’t happen until we have a coronavirus solution,” said Gnuschke, Director of the Sparks Bureau of Business & Economic Research.
Gnuschke is confident the economy will eventually bounce back but it will take a long time.
He said the best way to think about the recovery process is to compare it to a boxing match and at the moment the coronavirus has the upper hand.
“Coronavirus is going to win this next round because the recovery and the opening of the economy is only part of the solution,” Gnuschke said. “Until we find a solution for the coronavirus, the economy can’t fully recover.”
There’s also been some concern of a second surge of the coronavirus later this year.
If that happens, economists said any economic progress from this summer or fall could be wiped away.
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