Eight weeks ago, we still didn’t fully understand what was coming with COVID-19 and the economic implications of the shutdown. Today, I think it’s become obvious that a one size fits all approach is not going to work- not across the country and not in Colorado either. Every community will be affected differently depending on preparation, planning, economy, population density, and history. I throw history in there because as a community that has suffered through numerous boom and bust cycles, we’re better prepared than many of our neighbors across the state. We’ve climbed out of past recessions and we’ll climb out of this one too.
The response across the state has been very different. In early April, the City of Boulder announced the furlough of over 700 employees in response to COVID. Vail- with an economy almost entirely based on tourism- is feeling optimistic that revenues were only down 47% in March- one of their busiest months of the year.
By contrast, the City of Grand Junction is planning for a 25% loss of revenue this year and expects to manage that without layoffs at this point. That equates to a $16M budget shortfall. They were quickly able to find around $7M in savings through budget cuts and then will draw around $9M from the reserve fund to make up the difference. That, along with the city’s stimulus programs for restaurants, non-profits and small businesses, will draw the $29M reserve fund down to $20M, which is still higher than it was in 2016 when they began to build up the reserve fund in anticipation of an economic downturn. I’m sure they never imagined that downturn would come due to a pandemic, but nevertheless, they were preparing. That preparation, along with a stronger start to 2020 than anticipated, puts the city in a stable position to handle this crisis.
Watching unemployment numbers has also been telling. For the first time in Grand Junction’s history, we’re not reeling from the loss of energy jobs, but instead from the loss of hospitality and tourism. It won’t get much better this summer as our robust event schedule is cancelled and tourists stick close to home. It does, once again, raise the importance of diversification and we’ll be in much better shape overall than our neighboring resort communities that are fully dependent on tourism. Unemployment claims peaked during the last week in March and have declined every week since. The PPP loan helped and our slow reopening should help as well. Today we’re sitting at around 6% unemployment, far below the peaks we hit after the 2008 recession, but double what we were coming into 2020.
As far as the actual virus goes, Mesa County is faring better than most communities. I interviewed an epidemiologist from the Mesa County Health department earlier this week for a radio show on COVID Business Resources and was surprised to learn that we have the ability to test 50 people a day, but that only around 20 a day are showing up to be tested. In other words, very few people have symptoms. In a county of 153,000 people, we’ve tested over 2,000 people. Of those 2,000, 53 have tested positive, 8 have been hospitalized, 7 released and 0 have died. With the first phase of reopening, the health department expected to see a spike in COVID numbers, but have yet to see any increase.
Armed with that knowledge, I took a few steps towards normal this past week. I got my hair cut, ventured into a retail store previously closed for some retail therapy and then went out to dinner with my husband. At my hair salon, the owner fretted over whether they were doing all the right things and from what I could tell, she was. Everybody was wearing a mask, customers were asked to wait outside and chairs were wiped down between each client. The retail store was busy with a long line of customers properly spaced apart spending money. And the restaurant we went to quickly hit 30% capacity and began turning customers away. Everywhere we went, people were friendly and chatty, happy to out and about again with a sense of optimism and strength.
The next year will be hard. I’m not trying to sugarcoat the economic impact of this virus. The total impact is still just a guess, but we know significantly more today than we did eight weeks ago and by fall, we’ll know so much more than we do today. As I often write, our isolation in western Colorado is both a blessing and a curse. During these strange times, it most certainly is a blessing. As of today, we’re better prepared, better diversified, and more resilient than most. I have no doubt that we’ll come back stronger as well.
This column was originally published in The Daily Sentinel on May 17. GJEP’s monthly economic snapshot of the Grand Valley ran alongside the article, updated to include data focused on the coronavirus-induced crisis – see it here.