Cliff’s Take: Delta Uncertainty Rattles Confidence in the Economy
For those of you in the Beltway, can you believe we are in early August? It’s unseasonably pleasant right now – feeling more like fall, less like your typical DC summer swamp.
Though this perfection is tempting many to step back into the world again, we are no longer engaged in it with full gusto like a few weeks ago. Trepidation has gained a foothold again. And the Delta variant is the catalyst.
To be clear, not for everyone. Some – specifically the unvaccinated – are still living in alternate realities when it comes to COVID. But overall, the nation’s reemergence is stalling. People, in general, are skittish.
That nervousness is bleeding into our outlook on the strength of the economy. For the past three weeks, consumer confidence has zig-zagged dramatically up and down as people wait to see how Delta will play out.
Below are the key polling data points of the week.
- Mixed signals. Despite a strong July jobs report, we’re seeing a lot of uncertainty around the economy, particularly over the past three weeks. Inflation, new indoor mask mandates, a changing labor market, rising COVID cases, and the Delta variant all equate to a volatile mix. What do we call this? Virus-based uncertainty.
- Tale of two Americas. We are hearing a lot about how businesses simply can’t hire enough and that the lowest-paid workers have more options than ever before. Yet, how is that playing out in practice? According to higher earners, the economy is revving along. For those earning less, not so much. Delta variant? Inflation? Two Americas; two experiences.
- Delta summer. Concern about Delta is ticking up, moving the most among the already vaccinated. But, as the Delta variant continues to make itself known, vaccinations are also rising. “Hard passers”—those who are not at all likely to get the vaccine—are now more worried too. Nothing like a virulent vector to burst the alternate reality bubble.
- The un-nudgeables. Speaking of the hesitant, we took another look with Axios at how to persuade the unvaccinated. As it turns out, little will budge them, much like we found last time. The most influential would be an employer mandate. This is a recalcitrant lot.
- Back to work plans scrapped. Finally, businesses are pivoting yet again in response to the CDC’s latest guidance that even the vaccinated should be wearing masks indoors. Workplaces are pulling back their plans to reopen. Alas, this is our uncertain Delta summer.
Earlier this summer, it was looking like we might smoothly coast to a full reopening. The virus appears to have blunted our hopes for such a soft landing.
With all this, is it any surprise that the unvaccinated have become the target of America’s collective ire? Mandates are here to stay.
Be safe, be sane.
