By Kathryn Palmer, Wyoming Tribune Eagle via Wyoming News Exchange
CHEYENNE — Shuttered schools, closed businesses and work-from-home mandates are the new normal in Cheyenne as people try to limit social interaction to prevent the spread of COVID-19, which has already killed more than 2,000 Americans. Extended closures of public spaces are creating sudden and large-scale job and revenue losses. But local economists say social distancing is necessary to avoid prolonged financial hardship.
“Given that this is a pandemic, you’re going to have loud voices on both sides,” said Linda Thunstrom, an economist at the University of Wyoming who co-authored a new report that weighed the costs and benefits of shutting down the economy to curb the spread of COVID-19.
“It’s fair to say that social distancing is worth it,” Thunstrom said of the findings.
Keeping public spaces open during the pandemic would exponentially increase the number of cases, and, in turn, medical costs.
An overwhelmed health care system, Thunstrom said, is “what we’re trying to avoid.”
But COVID-19-related precautions have suddenly left droves of Cheyenne and Wyoming residents without work, unsure how they’ll pay their bills next month.
At the end of the third week in March, days after the first case of the virus was confirmed in Wyoming, 2,339 people across the state had filed initial unemployment claims, up from 510 the week before, according to data recently compiled by the Wyoming Department of Workforce Services.
“Wyoming’s economy was already starting to slow down,” said Jim Robinson, principal economist for the Wyoming Department of Administration and Information’s Economic Analysis Division.
At the close of 2019, personal income indicators had fallen and oil prices were down, among other slowdowns. Now, travel restrictions brought on by COVID-19 have further reduced the demand for oil. The hospitality, transit and customer service industries have also been hard hit.
“Now we’re looking at a pretty serious economic contraction – not just in Wyoming, but across the country,” Robinson said.
He anticipates that it will take a minimum of six months for the economy to look close to normal, but “it will take a while to unwind all these shutdowns and slowdowns.”
Thunstrom predicts it will take at least five years to fully recover from the unexpected recession created by COVID-19.
In the meantime, President Donald Trump last week signed a federal relief package that will soon put cash into the hands of millions of low- and middle-income Americans.
Some critics, including conservative Wyoming philanthropist Foster Friess, have endorsed reopening businesses to give people a place to spend the money.
“Will people spend their $1,200 checks if they see businesses shuttered and ‘no toilet paper?’” Friess, wrote in a news release praising Wyoming Gov. Mark Gordon for suggesting – not ordering, like other states have – Wyomingites stay home.
“In addition to the two primary goals of saving lives and avoiding hospital crush, we must also avoid destroying the economy,” Friess said.
But that interpretation fundamentally misses the point, said UW economist Robert Godby.
“The point of this relief act is to give people more money in their pockets to make ends meet during these tough times,” Godby said.
“We’ve gotten to the point in this pandemic where we need to stop the spread of the virus. … If we lose control that way, the death toll will be higher, and it will just take that much longer before the economy can get back up and running again.”
Godby said that although there are fewer than 100 cases in Wyoming, acting early is necessary if the state wants to avoid unnecessary loss of life and prolonged economic anguish.
“What’s manageable today in the medical system might be completely unmanageable a week from now,” Godby said. “When we can expect the economy to rebound depends on our success of stopping the virus from spreading now.”