ZANESVILLE - As schools and businesses close and many are sheltering in place, the global health crisis is becoming a global economic crisis. But how will it affect the residents of Muskingum County?
Local economic professors Daniel Amspaugh and Joseph Nowakowski shared their perspective on the emotional and economic impact of COVID-19.
"Our local community around Zanesville and Muskingum County is just now really starting to feel the impact on our economy from the coronavirus," said Amspaugh, assistant professor and business program director at Zane State College. "Many local businesses are now being told to close to help prevent the spread of the virus. Business owners now will start to see profits disappear for a number of weeks that could very well turn into months. Many small businesses may not survive without a steady income and cash flow for several months."
Most small business owners cannot afford to cover overhead expenses such as rent, utility bills, insurance and costs of running a business without steady customers. The first expense a business must usually cut is labor costs – which means people lose their jobs. And as people lose their jobs, they have no money to spend on other business and the downward cycle begins.
"This coronavirus has been especially difficult for consumers as it is something we can not see," Amspaugh said. "We have had other disasters in our community – floods, blizzards, power outages – but these are things we can see and usually have a somewhat known duration, usually hours or maybe days."
That uncertainty is causing panic among consumers, according to Dr. Nowakowski, professor of economics at Muskingum University.
"We would have a much better handle on the situation if there wasn't so much uncertanty," Nowakowski said.
Locally, it's hard to say how the coronavirus will effect the economy, he said. But, there is certain to be some ripple effect from the global economy.
Moving forward, demand for certain things will go down and that could have an impact of factories.
"This is a phenomenon we really haven't seen since the 1970s," Nowakowski said. "I think there is a good chance we will weather this storm locally. The economy is fundamentally strong and our community is more of a service community."
Nowakowski said the important thing for people to do now is take care of themselves and limit the spread.
"Wash your hands, social distance, don't let the kids go to grandpa and grandma's," Nowakowski said. "This is going to end and as soon as it does there will be a tremendous bounce back."
Even on a normal basis, Nowakowski said families should have enough in their savings to cover three months of their bills.
"Most people don't, but everyone should just in case a crisis happens," he said.
Small businesses help, buy local
Despite the impact locally, there is potential assistance available for small businesses, said Dana Matz, president for the Zanesville-Muskingum County Chamber of Commerce.
He has been in touch with several area business owners in an effort to apply for the Small Business Administration (SBA) Economic Injury Disaster Loans.
This federal program enables small businesses and non-profits throughout Ohio impacted by the outbreak of COVID-19 to apply for low-interest loans up to $2 million in assistance that can provide vital economic support to help overcome the temporary loss of revenue they are experiencing.
The loans can be used by small business owners and non-profits to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.
Matz said the chamber, which represents more than 700 businesses, is also collecting hours and menus from area restaurants and hopes to post to its Facebook page and website.
He also noted Adrian Adornetto, who owns three area restaurants, is on the Board of Directors for the Ohio Restaurant Association. The ORA is working with legislators to help write bills to provide assistance.
"We need to have a certain amount of businesses who need to loan before we can apply and be declared a county with economic disaster," Matz said. "There are a lot of businesses, especially ones who sell products or services, getting prepared for this and are waiting on the impact. We will continue to help in any way we can."
Matt Abbott, executive director of the Port Authority, has been in communications with businesses throughout the county, especially warehouses and factories with more than 1,000 employees.
He noted companies have told personnel who can work from home to do so and several have staggered lunch times so break rooms are not crowded.
Abbott said his office and the chamber are working together to do what they can, as programs are still being formulated that will be able to assist local programs.
"Many area businesses rely on each other for goods and services, and we haven't seen the depths of that impact," he said. "We continue to stress the importance of buying local. We have companies who have faced adversity, stayed resilient and come out stronger than before those situations. We're hopeful after this situation that area businesses will again be able to bounce back."
In the past week the President and Gov. Mike DeWine have provided the nation with a lot more information about the virus but, Amspaugh said, the information is sometimes causing more concern and uncertainty.
"I think we all believe this will pass and our economy nationally and locally will rebound. But, it is uncertain when this emotional and economic pain, a once in a lifetime event that we are all suffering through together, will end," Amspaugh said.
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March 22, 2020 at 08:14PM
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Navigating the uncertain economic impact of COVID-19 - Zanesville Times Recorder
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