New research out of Cal State Bakersfield shows the pandemic has had lopsided economic impacts in Kern, boosting some industries and devastating others, for a net loss of $1.7 billion in wages across the county.
Data presented at Saturday's Kern County Economic Summit showed jobs in general-merchandise sales jumped 20 percent between February and December of last year. Construction and real estate-related employment also experienced gains.
But more than one in four jobs in leisure and hospitality disappeared during the past year, CSUB economist Richard Gearhart reported. He noted employment in local oil production and ambulatory health care also sustained substantial losses.
Though the summit contained few major surprises, it provided a close look at how the COVID-19 crisis has disrupted day-to-day business. A key point of disagreement was how long it will take for the economy to recover.
Gearhart, focusing his economic analysis on wages and employment, presented a pessimistic view of the road ahead. He noted wages of those still employed rose a total of 2 percent and that, unlike during the great recession, even those in high-income careers saw their pay increase less than 1 percent.
"This recession is something absolutely new. It's something we have not seen in over a century," he said. "It's uniformly affected the income distribution except for the ultra-wealthy."
But a speaker at the summit who concentrated more on the national picture, Beacon Economics founder Christopher Thornberg, asserted jobs like those in restaurants and bars are likely to return soon as consumers flush with stimulus money head out to spend.
CSUB's Nyakundi Michieka, one of three economists speaking at the abbreviated event broadcasted by KGET-TV 17, pointed out that the biggest drops in Kern employment took place in May, August and September.
Local agriculture shed more than 20,000 jobs during each of those months, he noted. Similarly, the employment classification of health care and social assistance took its biggest hit in April with 5,300 layoffs, followed by job losses in the 3,000 to 4,000 range a few months later.
Oil and gas also saw sustained losses during the past year, he reported. Layoffs averaged about 2,000 per month for most of the year, with the worst hitting between September and December.
Thornberg said Kern has fared better than California overall, largely because of its lack of exposure to the tourism industry but also because business operating restrictions were more lax in the county than they were in much of the rest of the state.
His prediction was that the local economy will bounce back strong. That was in line with his view that the nation's fiscal and monetary response to the pandemic was excessive, evident in huge growth in bank deposits during the past year.
"We're expecting the economy to absolutely take off in the second half of 2021 as a result of this," he said.
Initially there was an unprecedented decline in economic activity, Thornberg said. But by May things started to pick up, and by January there was suggestion this could be the deepest but shortest recession in the nation's history.
The big winner was online retail sales, he said. Agriculture also did well overall and now the ports are trying to catch up with demand for food exports, he said.
Looking forward, he said there is a risk of inflation tied to the amount of money the government has made available to help the economy recover. But with so much money circulating in the economy now, he said another "Roaring '20s" may be around the corner.