WEBVTT - It's a K-Shaped Recovery: Some Are Getting Back to Normal While Others Being Left Behind

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<v Speaker 1>It's Tuesday, October six. I'm Oscar Romeiras from the Daily

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<v Speaker 1>Dive podcast in Los Angeles, and this is Reopening America.

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<v Speaker 1>The economic recovery of the US has been uneven, as

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<v Speaker 1>some workers and companies are showing signs of coming out fine,

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<v Speaker 1>while others face an uncertain path. The pandemic has been

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<v Speaker 1>kind to those that can work from home and the

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<v Speaker 1>businesses that cater to them, but lower wage workers and

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<v Speaker 1>those typed to tourism and public gatherings have suffered. Tao

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<v Speaker 1>Francis business reporter at the Wall Street Journal who joins

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<v Speaker 1>us for the K shaped recovery. Thanks for joining us, Teo,

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<v Speaker 1>good to be here. I wanted to talk about the

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<v Speaker 1>economic recovery of the country right now as we continue

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<v Speaker 1>to go through the pandemic. A lot of people were

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<v Speaker 1>hoping for some type of V shaped recovery, you shaped recovery.

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<v Speaker 1>That's when you know it obviously drops down very sharply

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<v Speaker 1>but recovers very quickly, or in the case of a U,

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<v Speaker 1>it kind of takes a little longer to come back,

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<v Speaker 1>but it comes back still nonetheless. But what we're seeing

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<v Speaker 1>out there is a little bit more of a K

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<v Speaker 1>shaped recovery, so really a kind of a divide between people.

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<v Speaker 1>People on an upper arm are recovering much more quickly

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<v Speaker 1>and and getting back to normal levels of people on

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<v Speaker 1>the lower arm are not so. TEO, tell us a

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<v Speaker 1>little bit about how the country is recovering so far economically.

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<v Speaker 1>I mean, if you look at the overall numbers, were

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<v Speaker 1>clearly coming back from a deep round of economic crisis.

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<v Speaker 1>But for some people that recovery is almost done. You

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<v Speaker 1>have essentially white collar workers, people who can do their

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<v Speaker 1>jobs from home. You have companies that either employee white

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<v Speaker 1>collar workers primarily or provide services that can be done

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<v Speaker 1>at the distance. You have highly educated people for them.

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<v Speaker 1>This recovery is well on its way, and in fact,

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<v Speaker 1>at some companies really there's been kind of a boom

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<v Speaker 1>and demand for things like cloud services or grocery stores.

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<v Speaker 1>There's been a rise in shopping for necessities. For companies

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<v Speaker 1>like Amazon, things are actually better than they work. Home

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<v Speaker 1>depot catering to people who are sort of adding onto

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<v Speaker 1>their house or improving their house and yard. But the

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<v Speaker 1>other half, the or the other part of the population

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<v Speaker 1>is on that lower arm of the k. These are

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<v Speaker 1>people whose jobs depend on face to face contact and

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<v Speaker 1>yet don't benefit from this demand for you know, home

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<v Speaker 1>building supplies and that kind of thing. These are people

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<v Speaker 1>who are in many cases on the lower end of

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<v Speaker 1>the educational spectrum, people who are in the lower end

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<v Speaker 1>of the wage spectrum, and then places that are really

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<v Speaker 1>heavily dependent on tourism and travel, which of course our

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<v Speaker 1>industries that have been really hard hit. So let's break

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<v Speaker 1>it down a little bit as far as how it

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<v Speaker 1>goes for workers. It really does seem to be that

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<v Speaker 1>people and the industries and all that they were able

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<v Speaker 1>to send their employees home to work from home really

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<v Speaker 1>are doing the best. And then the businesses that are

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<v Speaker 1>catering to them. So you know, you talk about like

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<v Speaker 1>Amazon doing really great because people are just ordering stuff

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<v Speaker 1>from home, they're sending things there, So those industries have

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<v Speaker 1>also been doing good. So this kind of work from

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<v Speaker 1>home thing really seems to be a major turning point

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<v Speaker 1>in how well people are doing if you think about it.

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<v Speaker 1>The economic crisis was brought about because of the shutdowns

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<v Speaker 1>that were done in response to a virus, right, and

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<v Speaker 1>a virus transmits you know, it's contagious among people when

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<v Speaker 1>they're in relatively close proximity to each other. So the

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<v Speaker 1>shutdowns were aimed to stop that. And so what did

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<v Speaker 1>you do? You you really send people home and if

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<v Speaker 1>you could keep working, like I can keep working, I

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<v Speaker 1>can do my job from home, a lot of white

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<v Speaker 1>collar workers can and they did, and their companies adapted,

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<v Speaker 1>and that took little effort and probably a little bit

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<v Speaker 1>of expense, like more zoom meetings and and maybe some

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<v Speaker 1>people got allowances for a desk chair or something at

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<v Speaker 1>home and that actually prompted some spending. But a lot

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<v Speaker 1>of people can't do that. There are some jobs that

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<v Speaker 1>it's just very difficult to do at home. Some of

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<v Speaker 1>those have been coming back, as you know, the auto

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<v Speaker 1>garageestive reopen and that sort of thing in places where

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<v Speaker 1>maybe people aren't face to face with their customers or

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<v Speaker 1>one another quite so much, or you can adapt the

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<v Speaker 1>business model to that, but their businesses where that's not

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<v Speaker 1>the case. Think about a movie theater, think about live sports,

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<v Speaker 1>think about theaters and concert venues. I mean, these are

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<v Speaker 1>all places where people go to be together to see

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<v Speaker 1>something live and in person, and that's really hard to

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<v Speaker 1>fix in a pandemic. And those people that work on

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<v Speaker 1>those industries, you know, a lot of them saw furloughs

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<v Speaker 1>for the first few months. A lot of those furloms

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<v Speaker 1>are becoming permanent. Now you mentioned movie theaters. Regal Cinemas

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<v Speaker 1>is closing, basically suspending all operations in the United States.

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<v Speaker 1>Disney announced twenty eight thousand layoffs last week. You know,

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<v Speaker 1>these furloughs are becoming permanent, and so they're really feeling

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<v Speaker 1>the pain of it, and that's just kind of prolonging

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<v Speaker 1>how long their return will be. In a real sense,

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<v Speaker 1>what you're seeing is the cautious optimism of the first

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<v Speaker 1>part of the pandemic really turn into pessimism for a

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<v Speaker 1>lot of people. And one thing they ask is is

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<v Speaker 1>they ask people whether they think they are layoffs or

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<v Speaker 1>temporary or permanent. And just as the summer has worn

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<v Speaker 1>on and now we're in the fall, you really saw

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<v Speaker 1>a fewer and fewer people saying that they thought there layoffs,

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<v Speaker 1>we're just going to be temporary. In other words, there's

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<v Speaker 1>this realization that at least for certain segments of the

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<v Speaker 1>economy and places in the country, this is not going

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<v Speaker 1>to be a temporary thing. This is going to drag on.

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<v Speaker 1>The economic return is kind of uneven all over the place.

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<v Speaker 1>You know, I suggest everybody go and read the article

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<v Speaker 1>because you laid out really well. But you know, there's

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<v Speaker 1>the workers, there's the industries, and there's the regions. Also,

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<v Speaker 1>you mentioned tourism. All these states and cities that dealt

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<v Speaker 1>heavily with tourism, they're seeing an uneven return. Hawaii because

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<v Speaker 1>their travel restrictions in place, has seen a big downturn.

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<v Speaker 1>Las Vegas the same way, Los Angeles, New York. All

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<v Speaker 1>these big hubs where people would go all the time,

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<v Speaker 1>you know they're not going or it's harder for them

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<v Speaker 1>to return as well, and their workers as well. You

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<v Speaker 1>look at two places right next to each other, like

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<v Speaker 1>Nevada and Utah states are literally next story to each other.

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<v Speaker 1>Nevada has been hit very hard and Utah is among

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<v Speaker 1>the less hard hit states, and a big part of

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<v Speaker 1>that is this dependence on face to face in this case,

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<v Speaker 1>tourism related activity. Yeah, I mean it's tough, and the recovery,

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<v Speaker 1>as I mentioned, is is kind of uneven all over

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<v Speaker 1>the place. But hopefully things start getting back into motion

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<v Speaker 1>and we can see some of these gains back in

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<v Speaker 1>these places that really needed. Tao Francis, Business reporter at

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<v Speaker 1>the Wall Street Journal. Thank you very much for joining us.

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<v Speaker 1>Thank you. I'm Austar Ramirez and this has been reopening America.

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<v Speaker 1>Don't forget that. For today's big news stories, you can

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<v Speaker 1>check me out on the Daily Dive podcast every Monday

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