The Texas economy is often viewed as uniquely resilient, but many economists are predicting that its businesses could be in shambles after the COVID-19 pandemic. A 10% drop in employment between February and April is one indication of this. That drop was more than twice the rate of jobs lost during the Great Recession a decade ago.
But economist Julia Coronado, president and founder of MacroPolicy Perspectives, and a professor at UT-Austin, still believes Texas is well-equipped to bounce back.
“Texas has a couple of advantages that will serve it well,” Coronado told Texas Standard host David Brown.
The main advantage is that some parts of the economy – like technology, health care, finance, manufacturing and construction – will still be able to thrive. Texas is not completely dominated by the energy sector, which was hit hard by the pandemic.
“That diversification of the economy will bode well during the recovery phase,” Coronado said.
She said Texas’ car culture also protects Texans’ health during the pandemic because many people don’t rely on public transportation to get to work, which means less exposure to others and the virus. That means people can, generally, get to and from work safely, which keeps the economy going.
But there are challenges, especially for those with lower incomes.
“The distributional impact has been terrible,” Coronado said. “The people losing the most jobs are lower income, hourly workers who do also tend to lack employer-based health insurance.”
Coronado warned that if Texas does not slow the spread of the virus, it cannot expect to fully restore its economy. She said wearing masks and practicing social distancing are things everyone can do to help.
“If we do follow these simple rules and guidelines, we can go about our business,” she said. “That will mean more jobs and more revenues for the economy, and we can restore some of what we lost.”
Coronado said it’s too early to say for sure how Texas will fare after COVID-19.
Web story by Sarah Gabrielli.