Predictions of when we might see an economic recovery vary widely, and – of course – the pace of improvement will depend in part on where you live. Sandy Hausman spoke with one expert on Virginia’s economy – a banker who deals with companies of all kinds.
Glenn Rust is President and CEO of Virginia National Bank – headquartered in Charlottesville with branches in Richmond, Roanoke, Winchester and Harrisonburg. Looking at the jobless rate in the Commonwealth, he is not happy.
"It’s bad," he says. "If you look at just the unemployment rate, we were sitting at around 2.9% in February, and that was a better number than the country."
But now he predicts it might climb to 13% – a higher rate than we saw during the Great Recession. He knows companies are planning a comeback.
"You see the airline industry saying, ‘We’re going to not fill the middle seat, and on top of that only fill the plane up to 50-60% capacity. All the flight attendants and the pilots will be masked and gloved, and the air scrubbers on the plane are going to circulate the air from the outside in about every two minutes.'"
But will that persuade customers to fly again? With places like Las Vegas and Disney World shut down, he’s doubtful. The same is true closer to home. It all depends on whether out economic engines can safely re-open.
"Look at all the businesses a mile around UVA," he suggests. "Without students, what does that business look like? I think the university is planning to open in September, but what if they don’t?"
Rust believes an effective vaccine will be a big shot in the arm for Virginia’s economy, and – until then – he hopes the state will impose rules to keep people from catching COVID.
"I think a good trade-off would be: let’s begin to open up sectors of the economy, but the trade-off has to be 80-90% of the folks masked when they go out."
He also argues federal aid will make a big difference – something the nation didn’t have until late in the Great Depression.
"At that time out government was pretty much, ‘No intervention. Let’s just let it play out,’" Rust explains.
And he’s encouraged by assistance provided to small business – something not general available during the Great Recession. For those still employed, he adds, it’s a great time to buy a house, and deals on new cars are spectacular.
"You can lock in a 30-year mortgage at 3.5% -- that’s something to be looked at as well," he says.
As for his own business, he predicts it will emerge stronger, with more customers relying on mobile banking by phone or car.
"Right before the coronavirus, we were thinking, ‘Do we really need drive thrus anymore?’ And the answer to that is we were really lucky that every one of our locations had a drive thru."
