Editor's note: Below you'll find the week 4 release of the City Economic Recovery Tracker (CERT), originally published Jan. 8, 2021. Visit the CERT homepage for the latest data.
The economic recovery of the five cities in Investopedia’s City Economic Recovery Tracker (CERT) was mixed during the week of Dec. 26. Houston, Chicago, and Columbus all saw gains in economic activity, while Los Angeles and New York stagnated. The outdoor dining ban in Los Angeles continues to hold back the city’s economic recovery, while the continued spike of COVID-19 cases also presents cause for concern. Meanwhile, restaurant reservations in New York have plummeted following Gov. Andrew Cuomo’s restriction on indoor dining. By contrast, restaurant reservations in Houston and Columbus have rebounded significantly.
Columbus saw the greatest overall weekly change of seven points, joining Houston as the only two cities where the economic recovery is more than halfway back to early March 2020 levels. Meanwhile, New York was the only city that lost traction during the week ending Dec. 26, down one index point, bringing its total score to 41. Los Angeles swapped places with Chicago as the bottom city on the leaderboard with a score of 39.
COVID-19 Case Rates Are Mixed
The COVID-19 case rates among the five cities have been mixed, with cases falling in Columbus, Chicago, and Houston, and rising in Los Angeles and New York. Los Angeles continued to see its case rate grow exponentially and had an average of 137 new cases per 100,000 people during the week of Dec. 26, double the rate of the next-highest city. Los Angeles County reported 872,000 COVID-19 cases and 11,545 deaths as of Jan. 8.
Both Columbus and Chicago’s case rates have declined significantly from earlier highs at 60 and 41 cases per 100,000 people, respectively. Nonetheless, Columbus’ rate is still just below New York’s April peak of 65. Regardless, the speed at which Chicago and Columbus were able to reverse their mounting case rates provides a glimmer of optimism that Los Angeles might be able to do the same in the coming weeks.
Vaccine distribution is well underway and nearly 6 million people in the U.S. have received the Covid-19 vaccine as of Jan. . However, the Trump administration has received criticism for the slow distribution of the vaccine, as a report stated that adequately vaccinating Americans will take 10 years at the current pace
Chicago Still Faces Worst Unemployment Rate
The number of initial unemployment claims is still significantly higher year-over-year and continues to trend upward in every city that we are tracking. Chicago still has the highest unemployment rate among the five cities, with its score for the measure more than four-times that of Houston, the least affected city.
While Houston still has the lowest unemployment score among the five cities, its rate of growth is concerning. Meanwhile, Columbus, New York, and Los Angeles have all flatlined between 2.5- to 3.5-times the normal unemployment rate.
The Bureau of Labor Statistics reported that 140,000 jobs were lost in December as layoffs mounted in the services sector. Cold weather and the unmitigated spread of the coronavirus led to tightening economic restrictions nationwide and caused more restaurants, bars, and hotels to close and lay off workers.
Dining Bans Hurt Restaurants
Los Angeles’ outdoor dining ban continues to keep the city’s restaurant index at zero, revisiting a reality last seen in spring when coronavirus first hit the U.S. and reservations were effectively nonexistent. New York’s indoor dining restriction is also reflected in the city’s average, but it has not brought New York to complete rock bottom as has occurred in Los Angeles.
Chicago, Houston, and Columbus all saw bumps in the number of reservations made week-over-week. Nonetheless, restaurants across the country are trying to power through the winter season as indoor dining restrictions and colder weather deter patrons. The restaurant industry was not included in the latest $900 billion stimulus plan signed by President Trump, which may threaten the survivability of many restaurants.
Transit Numbers Improve
Transit numbers had modest gains week-over-week in every city except New York for the week ending Dec. 26. Columbus and Houston sit at index scores of 67 and 63, respectively, and are doing markedly better than Los Angeles, New York, and Chicago, which are stuck at scores in the low- to mid-50s and are only halfway to recovery.
The federal government does plan to help struggling cities with their transit systems. The latest stimulus package has set aside $14 billion for struggling transit agencies, $2 billion for the private motorcoach, school bus, and ferry industries, and $1 billion for Amtrak.
Small Businesses Remain Bright Spot
The small business index remains the best-performing index for each of the five cities, with growth or maintenance occurring across the board. Houston continues to outperform every city with an index value of 91, which is 11 points higher than the second-best performing city of Columbus. Los Angeles, Chicago, and New York are all trending slightly lower at 78, 72, and 70, respectively.
Data by Amanda Morelli/Adrian Nesta. Additional reporting by Elana Dure.