The U.S. Bureau of Economic Analysis said today that the Gross Domestic Product fell 4.8 percent in South Carolina in the first quarter of 2020. In fact, it fell in every state and for the national as a whole, GDP fell 5%.
The largest drop was in New York: 8.2 percent. The smallest drop was in Nebraska: 1.3 percent.
By industry, construction fell by just .8 percent, and real estate and rental and leasing fell by just 1.1 percent. But GDP also showed some interesting results as a result of a pandemic, and large government spending in response:
- Accommodation and food services fell 26.8 percent, the leading contributor to negative GDP in 29 states.
- Arts, entertainment, and recreation fell by 34.7 percent, a contributor to GDP drop in every state.
- Healthcare and social assistance fell 7.8 percent, largely the result of suspension of profitable discretionary procedures.
- Agriculture, forestry, fishing, and hunting increased 15.5 percent, which moderated GDP decreases in 17 states.
The Federal government’s contribution to GDP rose by 2.2 percent, a function of $6 trillion in stimulus spending. But state and local government’s contribution to GDP fell by 4.9 percent.
Our take? High unemployment, coupled with the inherent conflict of social distancing and dining out or attending a ball game is a major factor in a struggling economy. However, with likely home buyers among the least impacted by the rise in unemployment, construction, especially residential construction, and real estate are bright spots. And if you have the time, and the means, why not go fishing?
As part of the CARES Act money received by the State of South Carolina, SCDSS is offering child care assistance for parents who work in businesses that have been deemed essential based on Governor McMaster’s Executive Orders. Your Home Builders Association has been in contact with DSS staff and construction is deemed essential even though it isn’t listed in the documents linked below.
The deadline to apply is Friday!
In order to qualify, you must be currently working at an essential business (construction is essential), you must need child care so you may continue to work, and you must complete a child care application by Friday, May 8. You do not have to meet any income guidelines for this limited program.
If you or any member of your team would like to apply and believe you meet the criteria, please email Christi Jeffcoat
. In the email, you will need to provide your first and last name, the best phone number to reach you, and your occupation and the business where you work. In the subject line, please put “Essential Employee Child Care Request”. Upon receipt of your email, DSS staff will coordinate with you by sending you the child care application and any other information that may help you find child care.
CARES Act Documents for Childcare Vouchers
As a part of Governor Henry McMaster’s accelerateSC initiative to get South Carolina working again, SC Department of Employment and Workforce has launched a Recall Task Force to help employers bring their teams back to work. Most of our members have not needed to furlough employees. In fact, Home Building has been the one bright spot in the economy in the Upstate. However, if you have furloughed employees and need help recalling them, download this letter from SCDEW, which has instructions for recalling employees and resources available for doing so.
Did you know that professional trade association’s like your Home Builders Association were among the few groups not eligible for stimulus funding? And like nearly all nonprofit organizations, ours has been impacted by the economic shutdown.
That is why your HBA signed onto a letter from the US Chamber of Commerce calling on Congress to provide stimulus funding to association’s like the HBA and the Chamber. We were one of more than 1,000 that signed the letter, and the only HBA in South Carolina to sign it. You can read the letter here.
Your HBA’s Board of Directors will be asking your to help the association that is helping your business remain essential. Watch for that request soon.
By Vee Daniel, President and CEO, Better Business Bureau of the Upstate
Better Business Bureau of the Upstate is warning and providing tips for the top six coronavirus scams. As the COVID-19 pandemic spreads, so does uncertainty and fear: two elements that con artists thrive on. During these stressful times, Vee Daniel, BBB President and CEO, recommends that consumers be especially alert to avoid falling for a scam.
1. Phony Cures and Fake Masks
BBB Scam Tracker has received numerous reports of people receiving emails and messages claiming that, for a price, they can buy products the government is supposedly keeping secret—ways to prevent or cure coronavirus. Medical experts are working hard to find a coronavirus vaccine, but none currently exists.
For more information on coronavirus cure scams, see the article BBB Scam Alert: Afraid of Getting Sick? Don’t Fall for a Coronavirus Con.
2. Economic Impact Payment (Stimulus Check) Scams
As soon as stimulus packages are announced and approved, scammers quickly get to work sending out fake economic impact checks and asking consumers to pay fees to get their money earlier than what the IRS has promised. These claims are false and open consumers to the risk of identity theft and outright theft of the funds in their bank account.
To learn more about economic impact check scams, see the article, Scam Alert: Government Relief Checks Trigger Latest Coronavirus Scam.
To learn more about the COVID-19 Economic Response Plan in Canada, please see the article, BBB Tip: Canada provides support to businesses, employees; for consumers, please refer to the Canadian Government’s website.
3. Phishing Scams
Several people are now working from home and con artists have stepped up their phishing scams. They may claim to be from an official department of the employer to offer IT support or claim the company issued computer has a virus. They may use scare tactics, stating the computer will crash if you don’t act immediately, all in an attempt to gain access to your computer remotely, or to your personal or company’s information.
For more information on coronavirus phishing scams, see the articles BBB Scam Alert: Working from home? Beware of scams targeting at-home workers and BBB Tips: 10 Tips to Stay Cyber Secure When Working Remotely.
4. Government Impersonation
Another common phishing scam brought on by the coronavirus pandemic is fake emails and text messages claiming the government agency needs you to take an “online coronavirus test” by clicking a link they provide. No such test currently exists, but if you click on the link, scammers can download malware onto your computer and gain access to your sensitive personal information.
For more information on coronavirus phishing scams, see the article BBB Scam Alert: “Mandatory” COVID-19 Test Texts are a Scam.
5. Employment Scams
Many people are looking for work online in the wake of coronavirus shutdowns. Fraudsters find ways to take advantage of this by posting phony work-from-home jobs promising remote work with good pay and no interview required. These cons often use real company names and can be very convincing.
After you are “hired,” the company may charge you upfront for “training.” You may need to provide your personal and banking information to run a credit check or set up direct deposit. You may be “accidentally” overpaid with a fake check and asked to deposit the check and wire back the difference. Or, you are asked to buy expensive equipment and supplies to work at home.
To protect yourself from employment scams, see the article Scam Alert: Coronavirus Creates “Perfect Storm” for Scammers.
6. Shortage Scams (Price Gouging)
Supplies such as hand sanitizer, face masks, and toilet paper are selling out in stores across the U.S. and Canada. Scammers take advantage of this situation and stockpile items in high demand. Then, they seek out potential clients, online and in person, and sell the products at extremely high prices. Price gouging is illegal, and high demand for products can lead to con artists selling products that are used, defective, or otherwise mishandled. In some cases, scammers will con people out of their money by accepting payments for products that don’t exist.
This has been an issue with face masks. Masks are sold out in most local stores and major online sellers. Instead, consumers are turning to unfamiliar online shops. Unfortunately, phony sellers abound. These scam online retailers take shoppers’ money—as well as personal information—and never deliver the masks.
For more information on mask scams, see the article BBB Scam Alert: Preparing for Coronavirus? That Face Mask Could be a Con. To learn more about coronavirus price gouging schemes, see the article BBB Alert: Coronavirus price gouging is up; consumers should report inflated prices.
How to Avoid Coronavirus Scams
These scams will evolve as the pandemic crisis continues, sometimes mimicking one scam for another. Being prepared to spot and report scams is more critical than ever.
Report price gouging. Anyone who suspects price gouging during a declared state of emergency can file a complaint with SC Attorney General Office or bbb.org.
Think twice before you click. If you receive an unsolicited text or email from someone you don’t know asking you to click on a link, don’t do it. In a reported recent scam, consumers received SMS messages saying a mandatory online coronavirus test was necessary, one they could complete by clicking a link. Scammers are using links and attachments like these that will download malware onto your electronic devices and steal personal information.
Do your homework. Even if a call or message seems to come from an official source, research it before handing over sensitive information, such as your name, address, or banking information. Scammers often try to earn consumers’ trust by impersonating reputable, official institutions.
Don’t accept calls from strangers. Con artists may call your home claiming to work for the government or healthcare system. Remember, neither the government, nor any healthcare-related agencies make unsolicited calls to individuals.
Avoid any “miracle” cures. Some scammers have been advertising miraculous cures and secret government vaccines. The claims are false, as there are no U.S. Food and Drug Administration-approved vaccines or drugs to prevent coronavirus, and no approved vaccines, drugs, or products specifically for curing coronavirus available for purchase online or in stores.
Watch out for employment and unemployment scams. If you are looking for work and find an online job offer that sounds too good to be true, beware. Con artists use job offers to steal your identity or banking information, or complete complex tasks for free as a trial. In addition, if you find yourself unemployed, only apply for unemployment benefits through official channels; otherwise, your personal information will be at risk.
Research before you donate. If you feel compelled to support a coronavirus-related cause with a financial donation, make sure the charity is legitimate. Check with give.org to verify the trustworthiness of the soliciting charity.
Be alert to stimulus payment scams. According to official sources, payments are expected to be issued automatically, with no action required from most people. No one will call, email or text you from the government about your check, and you should never pay any fees to receive your stimulus payment—nor should you receive a message on how to find out the status of your stimulus payment. To get the latest updates on economic impact payments, check the official IRS website regularly.
By: Joseph Von Nessen, Ph.D.
April 13, 2020
For many South Carolinians, the last few weeks have brought with them a level of uncertainty not seen in a long time. As the COVID-19 pandemic has spread across the United States and social distancing has become the new normal, many sectors of our economy have either been severely disrupted or completely stopped. Many workers have been laid off from their jobs and many more face the possibility of being laid off in the weeks ahead. And the stock market, which was at an all-time high just a few weeks ago, has seen a substantial contraction and is now highly volatile. Given this whirlwind of change, how can we begin to evaluate the state of our economy and the prospects for South Carolina’s recovery in the months ahead?
It is important to first recognize that this current economic shock is very different from those we have typically seen before. Most economic contractions are caused by fundamental problems in specific areas of the economy that lead to steady declines in economic activity that can last for many months or even years. By contrast, right now we are experiencing an intentional pause on an otherwise strong economy as part of a proactive effort to mitigate the spread of COVID-19. In this way, our current situation is more akin to a temporary statewide shutdown in response to a major winter storm than it is to a typical economic contraction. This is one reason why unemployment has been spiking so quickly. This also implies that if the pandemic abates in a relatively short period of time, we could see our economy recover faster than we might otherwise expect.
At this point, of course, we do not know how long the pandemic will last nor how long the guidelines on social distancing will remain in effect. We do know, however, that there are at least two likely paths to economic recovery for South Carolina in the months ahead after the pandemic is mitigated.
If the COVID-19 pandemic abates before the summer begins, South Carolina’s economy would likely follow what economists call a V-shaped recovery pattern – that is – a steep drop followed by a steep rise. In many sectors, a pent-up demand is already being created for the goods and services not currently being purchased. Once we begin to move back towards normal social interactions, there is likely to be a surge in consumer demand that will offset some of the losses we are currently experiencing. This could set the stage for a relatively fast recovery during the second half of the year. The federal stimulus, which includes direct payments to South Carolina households and cash-flow assistance to businesses, will also help to preserve consumer spending and minimize business losses in the meantime.
If, however, the pandemic extends into the summer months, many of South Carolina’s businesses that are temporarily closed right now would be increasingly likely to go bankrupt. This could lead to a second wave of layoffs as well as to disruptions in financial markets that would set the stage for further economic decline in the second half of 2020 and a much slower recovery period that could extend into 2021. Economists call this second path a U-shaped recovery pattern – that is – a steep drop followed by a slower rise. In the weeks ahead, it will be important to be on the lookout for any significant increase in the rate of bankruptcies among businesses, as this could indicate that a U-shaped recovery path is becoming more likely.
One other critical factor for South Carolina’s economic recovery will be the revival of consumer confidence. Even after social distancing guidelines are relaxed and businesses are reopened, consumer spending will not likely return to pre-pandemic levels if individuals are still uncomfortable going out in public. Health officials will be able to help to minimize this “hangover effect” as widespread screenings and effective treatments are put in place.
All industries are being affected by the COVID-19 pandemic and the housing industry is no exception. The single biggest predictor of housing demand is job growth, and the recent layoffs suggest that South Carolina has lost about six months of job growth in just the last three weeks alone. That’s the bad news. The good news is that a majority of these layoffs have been reported as temporary, suggesting that these workers will be hired back once the pandemic is over. Further, the long-run outlook for South Carolina’s economy remains strong. Over the past decade, South Carolina has consistently experienced both job growth rates and population growth rates that have been higher than the national average. In addition, the competitive advantages that South Carolina maintains – including strong natural amenities, a low cost of living, and a business-friendly environment – continue to make South Carolina an attractive choice for both companies and individuals. While we do not know how long this pandemic will last, we do know that South Carolina is well positioned for the years ahead.