But now even people in the most pro- Republican areas appear to be getting skittish, too. In the week before Thanksgiving attendance at South Dakotan recreationand- retail was 8% lower than normal. The continued increase in coronavirus cases may partially explain this, but a rise in death rates may be more significant. Research by Austan Goolsbee and Chad Syverson, both of the University of Chicago, finds that local deaths from coronavirus have a big impact on a local economy, perhaps because they bring home the seriousness of the situation. Deaths lag behind cases, and the share of American counties with at least one death from coronavirus in the previous week is soaring. Surveys suggest that a growing share of people worry about catching the virus.
The economy will rise again once a vaccine becomes available. Roughly 40% of the country should be vaccinated by March, suggests a recent paper by Goldman Sachs, a bank, putting America behind only Britain in terms of the speed of the rollout. And the vaccine-induced boost could be bigger than many expect. So far the pandemic has left surprisingly few scars on America’s economy. Business bankruptcies and the number of people in long-term unemployment remain lower than during the financial crisis of 2007 to 09.
Until then there will be further drags on the economy. Two further provisions related to UI, one which expanded eligibility to include the self-employed and gig workers, and one which provided extra weeks of benefits for recipients, are due to expire at the end of the year. A number of emergency lending programmes are also likely to end at that time. And the pandemic remains out of control. America, and especially its poorest folk, face a tough winter.