The Gristle

Economic Snapshots

Wednesday, June 24, 2020

ECONOMIC SNAPSHOTS: Whatcom wobbles in the twilight zone between Phase 2 and Phase 3 of reopening, but the early indications are its vital workforce economy may take a long time recovering from the body blows dealt by COVID-19. The county’s steady march to Phase 3 appeared in jeopardy last week after health officials announced an uptick in reported coronavirus cases in rural parts of the county.

Nearly 50 new cases were discovered over a period of three days, Health Director Erika Lautenbach reported, most in Lynden, Ferndale, and Blaine. Social gatherings where people were not wearing face coverings or masks are to blame, she said, but there are other factors at play as well.

While the usual suspects of folly and hardheadedness are indicated in the outbreak, a recent analysis by the Washington State Dept. of Health indicates a socioeconomic dimension to the pandemic—with vulnerable people of color and of lower incomes suffering at higher rates than the general population. For a county heavily dependent on agriculture and healthy agricultural workers, the concern is particularly acute.

“If the virus causing COVID-19 affected people equally regardless of race, we would think that 68 percent of the people diagnosed with COVID-19 would be white,” state health officials noted. “But only 37 percent of the people diagnosed with COVID-19 are white.”

No doubt cruel federal initiatives that force farmworkers to choose between their health, their employer directives or workplace conditions, and the potential loss of access to services or residency drive both the pandemic and the difficulty in collecting accurate data about the impacts of pandemic. A community continually under threat of arrest or deportation is unlikely to readily cooperate with data collection efforts.

Lower incomes are returning to work not necessarily because they want to (although many do), but because they have to.

A report released last week by the Regional Economic Partnership at the Port of Bellingham focuses on the issue of workforce impacts from a different vantage point—the impacts of coronavirus on the commercial fishing industry, which powerfully undergirds the local economy. The survey was developed in coordination with Lummi fisheries and the Working Waterfront Coalition of Whatcom County.

Among several important findings, the report survey forecasts sustained downturn in many parts of Whatcom County’s local economy throughout 2020. “Indeed, the Lummi Nation, tribal fishers, and fishers throughout the Salish Sea and Alaska began to report economic impacts of COVID-19 starting as early as January 2020 due to decreased demand from seafood markets, first in China, then throughout Asia, and globally by mid-March 2020,” report authors noted.

Crew safety is proving to be particularly difficult waters to navigate. Three American Seafoods fishing boats that had more than 100 crew members tested positive for the virus after docking at Bellingham Cold Storage in late May and early June.

One of the most significant bellwethers of the local economy is cross-border traffic with British Columbia, an indicator of relative trade strength of the dollar and the service and retail sectors of the economy. There the picture is particularly grim.

On March 21, the border between Canada and the United States closed to all “nonessential” passenger travel, marking the beginning of an unprecedented disruption to the flow of people (but not goods) between the two countries. Since restrictions were put in place, traffic volumes have declined by 98 percent, researchers from Western Washington University’s Border Policy Research Institute reported at a teleconference last week. One of the busiest crossings on the northern border of the United States, the Peace Arch entry greeted more than two million Canadian visitors in 2018.

A significant portion of Whatcom’s retail and service business is fueled by visitors from Canada, so even as stores and restaurants reopen, they’re witnessing a peculiar and painful recession.

The border situation is not likely to improve soon.

Canadian news organizations reported an agreement has again been reached between Canada and the United States to keep the border closed to all nonessential or “discretionary” travel for another month. The extension of the existing agreement means that the border restrictions will stay in place until July 21, even as both countries continue to reopen their economies. This marks the third time the agreement has been extended, news organizations reported.

Caution has paid off for Canada, logging a fraction of coronavirus cases compared to the United States. The entire province of British Columbia confirmed 18 cases in the same week Washington confirmed 408 new cases. As long as that imbalance continues, Canada will continue to favor restrictions at the border, researchers predicted.

Fewer than one Canadian in five (19 percent) said the border should open when the current deadline expires, according to a recent Angus Reid Institute poll. Most (42 percent) said September would be a good target to reopen the border to nonessential traffic, while more than a quarter of those polled said the countries should wait until 2021.

Border crossings, once strongly in sync with the exchange rate and comparative strength of the Canadian dollar, were thrown out of phase after the terrorist attacks of Sept. 11, 2001—an indicator of just how long external events can influence cross-border traffic. This correlation has again been disrupted with the COVID-19 health crisis.

Even with help, the local economy will suffer for a long time. But there is no sign of more federal help on the way. Our economic snapshots are overexposed.

Past Columns
False Flags

June 10, 2020

Napoleons In Exile

May 27, 2020

Alcoa Unmade

April 29, 2020

Sideshow

March 25, 2020

Protecting the Vulnerable

March 18, 2020

An Evolving Crisis

March 18, 2020

Pandemic Pandemonium

March 11, 2020

A New Hope

March 4, 2020

Managing Expectations

February 26, 2020

A Mad Triad

February 19, 2020

Another Jail Fail?

February 12, 2020

Wacko Whatcom

February 5, 2020

Shelter From the Storm

January 29, 2020

Priorities

January 22, 2020

‘I Have A Dream’

January 15, 2020

Olympia Olympics

January 8, 2020

What Dreams May Come

January 1, 2020