Worcester Business Journal

BY GRANT WELKER Worcester Business Journal News Editor With the global economy shutting down, a recession is almost certain, although Central Mass. may be spared from the worst of the downturn F O C U S H E A L T H C A R E F or more than a decade, the regional, national and global economies grew despite trade wars, rising home prices, growing college debt and a feeling a recession was bound to come. Now, due to the coronavirus pandemic, a recession appears near. Greater Worcester may be better insulated than many other regions. It isn't heavily dependent on tourism or conventions, and it has relatively few hotel rooms. It isn't home to any casinos and doesn't host headquarters for any major airlines, energy companies, automakers or cruise lines, among others who have been hardest hit. But no region is safe from economic harm, particularly with countless small businesses having to close for the foreseeable future to help contain the spread of coronavirus. "We're not immune from any recession whatsoever, but I don't think we're going to get the worst of what's coming," said Robert Baumann, an economics professor at College of the Holy Cross in Worcester. Prominent financial firms aren't mincing words about how bad they expect the coming months to be economically. J.P. Morgan of New York has predicted a 14% contraction in the U.S. economy in the second quarter, and Goldman Sachs of New York is expecting a 24% drop – revising that forecast from 5% days earlier. Wells Fargo Investment Institute, part of the San Francisco-based bank, forecasted what it called a short but deep recession based on the pandemic, as well as a sharp drop in worldwide oil prices. Federal Reserve Bank of St. Louis President James Bullard was less optimistic. He told financial media outlet Bloomberg he expects the U.S. unemployment rate may hit 30% in the second quarter, along with a 50% drop in gross domestic product. How Greater Worcester fares How Worcester is affected can't be illustrated by the same startling scenes as an empty Times Square or vacant Las Vegas casinos. But the city and Central Massachusetts are lined with small businesses economists say are facing a brutal period of time. "It's hard to tell at this point with all the uncertainty," said Luis Rosero, an associate business professor at Framingham State University. Traditional manufacturing – more concentrated in the Worcester metropolitan area than most – could be harder hit, he said. Unlike most office jobs, manufacturing work typically can't be done from home, and Gov. Charlie Baker's ban effective March 24 on non-essential employment and travel could greatly hamper those businesses, although a number of manufacturing firms were labeled as essential, including critical, military and chemical manufacturing. e coronavirus recession 10 Worcester Business Journal | March 30, 2020 | wbjournal.com The coronavirus pandemic has temporarily closed the Sole Proprietor restaurant in Worcester, kept away many workers at AbbVie, one of the city's largest employers, and caused a run on toilet paper and paper towels at Stop & Shop and other grocery stores. PHOTOS/GRANT WELKER

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