West Virginia Executive Spring/Summer 2020 | Page 24

[ economy ]
Economic Outlook
Coronavirus in West Virginia
Today, we find ourselves in the midst of
the most unusual economic situation we
have experienced in our lifetimes because
of the coronavirus pandemic. Our state and
national economies suffered a severe blow
over the course of March and April, and
the speed at which the economy declined
was unprecedented in every way. We have
already begun to see signs of economic
improvement that provide some optimism,
but we continue to face tremendous uncertainty
as we look for signs of lasting
economic damage. Furthermore, trends
in virus caseloads and hospitalizations
remain an important factor of the outlook
as concerns of a potential second wave of
infections later this year linger.
The key driver of the uniqueness of this
recession is that it did not have an economic
cause. Consider our last recession in 2008-
2009. The causes of that recession were
rooted in a variety of economic problems
that preceded the recession by a decade or
more. By contrast, the U.S. economy was
in good shape at the beginning of 2020:
output growth was strong, unemployment
was at historic lows and inflation was
20
18
16
14
12
10
8
6
4
% of Labor Force
1976
1978
Feb-83, 18.8
Mar-92, 11.5
low and steady. This recession was driven
by a virus, and our path forward largely
depends on public health, making it quite
difficult to forecast what the recovery
will look like.
While all economic data comes with
a lag and a complete picture of the pandemic’s
damage to the economy cannot
be painted at this time, there are several
JOHN DESKINS
West Virginia’s Measured Unemployment Rate
*Unemployment rate data reflect middle of reference month
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
Oct-10, 8.8
Apr-20, 15.9
May-20, 12.9
Feb-20, 4.9
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
Source: Bureau of Business & Economic Research
key economic indicators that are available
to help us understand West Virginia’s
coronavirus economy.
Overall, West Virginia lost around
94,000 jobs between mid-February and
mid-April. This represents around 13
percent of all the jobs in the state. It is
unimaginable to think of losing this many
jobs over such a short period of time.
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WEST VIRGINIA EXECUTIVE