The National Association of Business Economics recently released a survey showing the sentiments of 235 private economists nationwide. The majority believe that the US economy is still in a COVID-induced recession, and almost half expect the economy to not return to pre-pandemic levels until the second half of 2022 or later. An overwhelming majority also expressed at least “somewhat” of a concern that federal public debt will likely surpass 100% of GDP. This information is crucial for Hampton Roads startups and small businesses, as it provides insight on economic expectations and potential policy priorities for the near future, which include combatting COVID-19, promoting economic recovery, and health policy.

National Association of Business Economics Survey Results

The National Association of Business Economics has just released the results of a member survey that provides insights into the sentiments of 235 private economists nationwide. Their findings include the following:

Economic Outlook

  • 65% of those polled believe that the US economy continues to be in a COVID inspired recession, and 49% believe that the economy will not return to pre-pandemic levels until the 2nd half of 2022 or later
  • 80% of respondents indicate there is a 25% chance of a “double-dip” recession
  • 40% of members indicated that Congress’ fiscal response was insufficient, while 37% indicated the response was adequate
  • 75% of members believe that the optimal size for the next fiscal package to be $1 trillion or higher

Policy Priorities

  • The 3 most important policy issues that the next presidential administration should address during its first year should be:
    • Combatting COVID-19 (54%)
    • Promoting economic recovery (47%)
    • Health policy (37%)
  • Overall, respondents feel that fiscal and monetary policies are generally adequate
  • 60% of members stated that Congress should extend both supplemental unemployment insurance and the PPP program should be extended

Concerns and Expectations

  • 88% responded that they were at least “somewhat” concerned that federal public debt will likely surpass 100% of GDP
  • 41% of members expect nonfarm payrolls to retain their February 2020 level sometime in 2022, 34% expect that will not occur until 2023 and 18% expect it to occur in 2021
  • Respondents indicated that 40% of all business closures would be permanent
  • 85% of members expect flat to declining global economic activity in 2020
  • 41% stated that the global economy would not return to pre-COVID levels until at least 2022, while 30% believed it will occur in 2021
  • 57% of members believe that China will recover first, followed by the Eurozone (12%), then the US (10%)

Compliments of Mike Austin, Hampton Roads Small Business Development Center

Question & Answer

1. What do the majority of private economists believe about the current state of the US economy?

65% of those polled believe that the US economy continues to be in a COVID inspired recession, and 49% believe that the economy will not return to pre-pandemic levels until the 2nd half of 2022 or later.

2. What are the top 3 policy priorities identified by the surveyed economists for the next presidential administration?

The top 3 policy issues that the next presidential administration should address during its first year are combatting COVID-19 (54%), promoting economic recovery (47%), and health policy (37%).

3. What is the general sentiment among respondents regarding fiscal and monetary policies?

Overall, respondents feel that fiscal and monetary policies are generally adequate, with 40% of members stating that Congress should extend both supplemental unemployment insurance and the PPP program.