It's time to bet on Florida’s economy
Bottom Line: One of my frustrations during the pandemic has been the rhetorical homage paid to the guidance of science and health experts by many public officials, but not actually using it. Though politics should never play a role in policy making during a pandemic, we know it has, especially in South Florida. It’s my hope that moving past Tuesday’s elections will help facilitate more pragmatism in policy making rather than political decisions. As we’ve discussed literally every top health and education official at the state and federal level has been supportive of allowing for classroom education and a responsible reopening of the economy. Yet we know Broward, Miami-Dade and Palm Beach Counties have all ignored the experts holding parents and students hostage to delayed online only options for schools with our economies mired in phase one reopening. The toll is significant. Approximately 30% of South Florida families have already missed a rent or mortgage payment or are at risk of doing so within a month. Also, in a recent conversation with the CEO of Florida’s Restaurant and Lodging Association, approximately 70% of related businesses that are currently open are still losing money because of the limitations currently forced on them by local officials. This is all discouraging news surrounding our current state of affairs. It’s all the more frustrating given more Floridian’s are out and about daily than at any point prior to the lockdowns and yet case counts and positivity rates with COVID-19 are at their lowest levels since June. But as bad as this has been and may be, this too shall pass and when it does – look out. There’s a lot to look forward to.
Our story in Florida is much different that of say New York. New York’s recovery will be challenged due to population loss, especially among its highest taxpayers, who often happen to be top job producers as well. As we know, the top earners and job producers leaving New York are most commonly coming here. It’s literally a case of their loss being our gain. This was recently punctuated by Carl Icahn’s decision to relocate his $13 billion company, Ichan Enterprises, and many of its 28,000 jobs to South Florida. It’s evidence that regardless of the unnecessarily harm being caused to our economy right now, we’ll likely bounce back strong once the lockdowns are gone. This is further evidenced in the economic forecasting by the University of Central Florida’s Institute for Economic Forecasting. First, they show Florida’s economy faring better than most, with a decline of 6% in total this year. It’s bad for sure, but it’s not worse than what we lived through in Florida during the Great Recession. Most importantly for a year which begins in fewer than five months – the bounce back is expected to wipe out this year’s losses and then some.
According to UCF’s forecasting, Florida’s economy is expected to grow by 7.6% next year. In other words, about a year from now our economy should be better than it’s ever been. That might be hard to envision right now but consider the stock market. After setting record highs in February, stocks sold off in a record setting way leading to declines of about 40% for the S&P 500 in mid-March. Back then it was probably hard to envision that five months later the index would reach new record highs...but here we are. You’re likely familiar with the expression that it’s darkest before the dawn. In Florida right now, it’s about to be dawn and there’s a lot to feel better about going forward. Especially if we make good decisions in the voting booth.