Business

Changes in Business Cycle Post Pandemic

Pandemic has been really stressful for everyone specially the bread earners of the family. There has been huge drop in people’s income during the pandemic phase. Also, after the pandemic things are reviving but at a slow parameter. This was something that we all expected as no miracle can pick up the falling economy. Things will get on point but with time. Talking about the GDP drop, the government of US saw this coming. There was a sharp decline in GDP approximately 9.5% in the second quarter says Gaurav Mohindra. Many if the businesses closed their doors due to inability to sustain in those conditions. Nothing unexpected came as people were quite a lot mentally prepared for this change.

However, there were several federal relief legislations that has been given by the government which kept households afloat, thereby preventing the economic activity from declining. On the other hand, there was a slight upward trend seen in the personal income during the shutdown, but due to the closure of the factories and businesses, output fall.

Talking about the recovery during the summer the business cycle recovered showcasing a positive energy. As during the end of June, retail sales had recovered to 97% which indirectly gave rose household saving rate. All these were the sign of rising demand among consumers as things started to fall in place, so does the business cycle says Gaurav Mohindra.

There was a partial improvement that was seen in the labour markets. But unfortunately, the major problem stands still, unemployment remained high. Economy had opportunities but not much to feed this big population, only one-third of the workers got back their jobs. The summer after pandemic witnessed opening of the factories manufacturing activity climbed rapidly through the summer as factories reopened, recovering the losses of last year.

Still in many parts of world, Businesses are adapting to these new changes but still regional outbreaks are causing disruptions. This may be due to the spike of covid cases in different parts of the world which is making the market sentiments more adverse. However, the hospitals appear to be handling the situation in a better way this is the effect of vaccine drive that this surge in patients are handled well says Gaurav Mohindra.  Also, this shows the better understanding of current scenario.

In conclusion what can be seen is all the sectors are recovering but what tops the list is the retail sales and residential real estate. Industries like travel, hospitality and dining, are still not full recovery but are doing well bridging the gap of revenue shortfalls. What has surprised everyone is the not changing and uprising stock market, which was seen major recoveries than past from the second quarters. Indirectly this has given an upsurge to the real estate industry as the investors are gaining well, so they are parking there funds to a safer sector that is the real estate sector.

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