It might seem odd to examine the economic upheaval wrought by the COVID-19 pandemic and seek some positives, but a few sectors stand out as potential beneficiaries of the ongoing transformation of the economy.
Of course, many industries are in dire straits:
- Small businesses, including retailers, have struggled as states, counties and municipalities implemented shutdowns to quell the spread of the coronavirus.
- Restaurants and hotels have been devastated, with many closing and/or filing bankruptcy.
- Health-care providers have been on the front lines of the pandemic, even as revenue from elective procedures has plummeted. Layoffs, furloughs and pay cuts have been implemented at many providers.
- Commercial real estate — primarily office and retail — is weathering lower occupancies, downward pressure on lease rates and unpaid rents, along with perhaps permanent shifts in demand from office users who have grown comfortable with work-at-home situations for their employees.
- State, county and local governments have furloughed thousands of workers as they struggle under lower tax revenues.
Add in the effects in K-12 education, higher education and other sectors — with concern about how the banking industry will absorb potential future losses — and the situation appears dire indeed, with layoffs, furloughs, bankruptcies and foreclosures becoming more common.
Yet, a few sectors have benefited from the economic forces at work today.
Industrial and warehouse spaces are undergoing a boom, with high demand for distribution centers as physical and online retailers attempt to meet increased demand.
Life-sciences companies have shifted to development of COVID tests and vaccines, with some increasing employment dramatically to meet demand. One local biotech exec told me that his company’s growth was accelerated by at least two years because of the company’s work on COVID testing.
Residential real estate, though hammered in the early months of COVID, appears to have rebounded, although the market seems to be suffering from a lack of supply.
Some manufacturers have shifted to produce personal protective equipment, ventilators or other in-demand equipment and supplies.
Grocery stores have done extremely well during COVID, as consumers focus on in-home dining.
Delivery services — including couriers, logistics companies, food delivery and others — have witnessed heightened demand.
Online-training companies have benefited from an acceleration of the trend toward Internet-based education, as have video-streaming and online-meeting services. Anyone heard of Zoom?
Ditto for companies focused on cybersecurity, broadband and other forms of technology and telecommunications. As employees work from home, a stable high-tech infrastructure becomes essential.
Make no mistake: COVID has been devastating for the local, state, national and global economies. But in the darkest night, it’s comforting to see a little light.
Christopher Wood can be reached at 303-630-1942, 970-232-3133 or firstname.lastname@example.org.