Premise COVID-19 Snapshot: U.S. Economic Impact – A Story of Two Approaches, Part 2

Premise COVID-19 Snapshot: U.S. Economic Impact – A Story of Two Approaches, Part 2


By Theo Reuter and Saleel Huprikar | Geospatial Data Scientist, Data Scientist Intern

The COVID-19 pandemic has continued its relentless, lethal spread across the globe, with over 2 million people infected and over 130,000 deaths to date. Some countries that were hit hardest and earliest like China, Spain and Italy, have managed to bend the curve of infections and deaths, while other countries are just starting to see increases in the number of infections and deaths. 

The situation has continued to deteriorate in the United States in recent weeks with cases in the U.S. in excess of 750,000, and over 42,000 deaths. Some states that took earlier more aggressive mitigation measures are starting to see positive signs, with California now experiencing a slow rate of increase in COVID-19 cases. The primary, necessary responses to the outbreak in the United States—instituting social distancing and shelter-in-place orders—have resulted in an unprecedented impact on the economy. Over 17 million people have filed unemployment claims in the past month. Over six million filed claims in the first week of April alone, doubling the record of three million set two weeks before, which as seen above, had itself shattered the previous record.

Study Overview 

This post is a follow up to a previous post written two weeks ago, which can be found here. To better understand the impact COVID-19 is having across the nation, Premise has had a survey in the field since March 2, asking our Contributors key questions about the economic impact they are witnessing from COVID-19. To date, this survey has collected over 31,000 responses on a range of topics such as supply shortages and people’s impressions of the economy. We will focus on the same questions as last time: 1) “What is your level of agreement with the statement: ‘The economy will get worse before it gets better,” and 2) “Are you aware of any product/supply shortages in your area?” For both questions, we used a simple three-day moving average to determine the percentage of our Contributors who answered ‘agree’ or ‘strongly agree’ for question 1, and ‘yes’ for question 2. The national distribution of responses is displayed below.

Figure 1: Number of Responses to Premise Survey: Economic Impact of COVID-19 (U.S.) 3/1 – 4/13

A Tale of Two Regions – Revisited 

The COVID-19 outbreak in the United States has been characterized by a range of responses and experiences in different regions of the country. New York, the hardest hit, has over 200,000 cases and 13,000 deaths while Utah to date has about 2,400 cases and 18 deaths. To study these differences, we will again examine two regions that have different experiences and taken different approaches to date – the West Coast (California, Oregon and Washington) and a group of Southern states (Florida, Georgia and Alabama).  

In the previous post, we found that both regions experienced a significant increase in concern about the immediate future of the economy. We also noticed that both regions saw a significant increase in the percentage of people who observed supply shortages. However, on both counts, the three Southern states collectively tended to lag behind the West Coast, though the two regions ended March in similar places for both questions. We suspected this delay was due to two main factors: 1) the West Coast getting hit by COVID-19 before the South, and 2) the West Coast taking a more aggressive approach to the crisis (with all three West Coast states having shelter-in-place orders established by March 23), while the governmental responses occurred later for the South. Here, we will continue to explore these trends.  

 

 

 

 


GIFS representing respondents who either ‘agree’ or ‘strongly agree’ with the statement “Do you think the economy will get worse before it gets better.”

COVID-19 Cases in both Regions at a Glance

Figure 2

With an additional two weeks of data collected by our Contributors, Premise can shed further light on how people around the country are being impacted by COVID-19. An examination of the difference in COVID-19 cases is a helpful place to begin our analysis. As seen in the plot above showing cumulative COVID-19 cases (data is from Johns Hopkins CSSE), we can see that the West Coast was struck by COVID-19 before the South, possibly explaining the delay seen in concern for the economy and supply shortages in the South, and also accounting for the earlier imposition of shelter-in-place orders on the West Coast. With minimal cases in the South, we might expect that people would be less concerned about the economic impacts of COVID-19 as seen in our previous blog post.  However, we can see that the relationship between the infection trends of the two regions has recently passed a key point—on April 11, the Southern states in question for the first time recorded more cases than the West Coast, despite seeing their first confirmed case of COVID-19 a full 40 days after the first confirmed case on the West Coast. (The first confirmed case in the United States was January 22, 2020 in Washington State.) In fact, the number of cases on the West Coast is beginning to show initial signs of leveling off with a reduced rate of increase in infections, while cases in the South show no signs of slowing down yet.

Updated Survey Results: Economic Concern

Figure 3

Looking at the results of the economic question, we can see here that people on the West Coast have consistently been more concerned about the future of the economy than citizens in the Southeast, which is a trend that has continued in the last two weeks. However, it seems that the West Coast has hit a ceiling in terms of economic concern, which might be due to recent news that the curve is starting to flatten on the West Coast, indicating possible signs of improvement. Considering that the West Coast was one of the first places to order citizens to shelter-in-place, it would be expected that they would be some of the first places to finally gain a foothold against the virus and begin to turn the tide.

As of April 4, a week and a half after the West Coast the three Southern states all had shelter-in-place orders in effect, which could have contributed to the higher proportion of positive views of the economy from respondents in the Southeast. Interestingly, since we last wrote—when both regions had the same level of concern—the Southern states’ concern level appears to have actually dropped, despite the aforementioned spike in unemployment claims, continued spread of the virus, and passing the West Coast in total COVID-19 cases.

Updated Survey Results: Supply Shortages

Figure 4

Similar to our previous post, people on the West Coast consistently reported a higher percentage of observed supply shortages than their counterparts in the Southeast, but these numbers again diverged the past two weeks. It is unclear if the volatility in the three Southern states’ numbers is due to varying response rates or an actual drop in the amount of shortages.  Premise will continue to evaluate these trends as the data comes in. Interestingly, as in the previous graph, the news of massive numbers of unemployment did not seem to have any significant impact on the West Coast, and any impact on the Southern states is unclear.

Putting It Together

Juxtaposing the coronavirus infection data with Premise’s data reveals fundamental differences regarding how people in these two regions in the United States feel about the COVID-19 pandemic. The Southern states did not experience their first confirmed case until 40 days after the first West Coast case, and waited a full week and a half after the entire West Coast was sheltering in place to issue similar stay-at-home orders. And yet, despite having recently passed the West Coast in number of confirmed infections and suffering similarly from the unprecedented economic slowdown, Contributors in the South remain more confident about the economy and have seen fewer supply shortages than Contributors on the West Coast. In fact, the Contributors in the South have become even more confident and reported fewer shortages the past two weeks than when we last wrote, with a lower percentage of respondents saying they believed the economy would get worse before it got better! Perhaps our Contributors feel that with their states on lockdown, it cannot get worse.

When looking for causes, the West Coast’s responses could be due to their political leaders sounding the alarm much earlier and implementing shelter-in-place (and restricted movement) orders, which might have prompted citizens to stock up on major supplies earlier than citizens in the Southern states. The reasons for the South’s economic confidence despite an unprecedented slowdown are not clear and we will continue to explore these. One possibility may be that political leadership at the highest levels in these states has consistently been more optimistic about the possible course of the virus than leaders on the West Coast. 

Conclusion and Next Steps

As we have just laid out, there is a measurable and widening difference in sentiment between these two regions, which have taken different approaches to combating the pandemic. With the South recently overtaking the West Coast in total number of COVID-19 cases (a position it will likely maintain for the foreseeable future and a gap that could unfortunately widen), it will be interesting to see if the patterns of sentiment demonstrated here change or continue to diverge in the coming weeks. It will also be interesting to see if the West Coast’s initial signs of improvement continue or if the number of cases and resulting concerns begin to rise again. The West Coast states just formally announced a pact regarding how and when they will lift quarantine measures, raising the question of whether the Southern states will pursue a similarly unified agenda.

Premise will continue to gather information on these (and other) economic impacts tied to COVID-19, tracking the attitudes toward the state of the economy and governmental responses, to see what effect they have on our Contributors’ sentiments and behaviors.

You can visit www.premise.com/COVID-19 to learn more about the data we are collecting about this global pandemic.  

About Theo Reuter and Saleel Huprikar

Theo Reuter is a Geospatial Data Scientist who is passionate about data and how it can be used to tell stories. Recently graduated from the University of Maryland College Park with an MS in GIS, he has been hard at work at Premise since January 2020 providing mapping, scripting and spatial data analysis, leveraging the spatial nature of the data Premise collects.

Saleel Huprikar is a Data Scientist intern, who joined Premise Data in February of this year. He recently graduated from the University of Pennsylvania, where he studied Economics, Mathematics and Statistics. Saleel is very passionate about the intersection of statistics and social sciences; he recently published a research paper in the Berkeley Economic Review that analyzes how state-level and local-level economic conditions (e.g. cost of living) affect people’s attitudes towards a federal minimum wage increase using a statistical regression framework. At Premise, Saleel has been involved in developing and implementing statistical methodologies in order to help Premise understand the data that it has collected and establish an analytical strategy for future data collection.