As Michigan Gov. Gretchen Whitmer advised residents and businesses to “Stay Home, Stay Safe,” Metro Detroit companies of all sizes and industries are working collectively to combat the economic recession that seems likely in the weeks and months to come.
Bedrock on Monday announced it will waive all rent, expenses and parking fees for restaurants and retail tenants that qualify as “small businesses” for the months of April, May and June in order to help these businesses weather this time of uncertainty and allow them to use their resources to pay other bills and meet payroll commitments.
Bedrock officials said they recognized that many of its small restaurant and retail tenants are experiencing an especially hard economic hit.
“As with all of our tenants, entrepreneurs and small businesses play an incredibly important role in our local economy, which has been central to Dan Gilbert’s vision over the last 10 years of his investments in Detroit and Cleveland,” Bedrock CEO Matt Cullen said in a statement.
“It is going to take the entire community to mitigate the effects of this pandemic on the region, and we are happy to do our part to help our portfolio’s most vulnerable businesses weather the storm. We are staying in close contact with each of our tenants and stakeholders every day to understand their needs and concerns, and how we can help,” Cullen said.
Bedrock tenant Kacee Must, who operates Citizen Yoga Detroit, said she received a call about the changes in rent, expenses and parking fees this weekend.
“I cried (a lot). I did not realize how much stress I had been holding for the past two weeks until that moment,” said Must, who opened Citizen Yoga Detroit more than five years ago with the support of the Bedrock Team.
“They promised that they would help build a yoga community with me,” Must said. “They did! In such an uncertain moment, we are all so grateful to have our Landlord/friends at Bedrock and QL watching out for us. Thank you from all of us for making this very stressful time a little less stressful.”
Making more masks
Fiat Chrysler Automobiles told the local media that it has plans to take one of its Chinese plants and begin manufacturing face masks intended for first responders and health-care workers.
According to The Detroit News, Fiat Chrysler CEO Mike Manley told employees in a letter that the conversion in one of the automaker’s plants to mask making would start Monday.
“We are working through the protocols to start production in the coming weeks and ultimately produce over a million face masks per month to donate to first responders and health care providers,” he wrote, according to news reports.
In a statement spokeswoman Shawn Morgan said the China plant made sense because “the fastest way we could get relief to U.S. first responders and health care workers was to use one of our operational plants.”
Stifel Chief Economist Lindsey Piegza said the economic impact of Coronavirus fears and U.S. recession are justified. In part, she says, “At this point, the most optimistic outcome for the domestic economy appears to be a temporary dip into negative growth (previously our base-case) akin to the contraction of 2001 with the worst case being a prolonged depression-like scenario similar to that experienced in 1929.”
Richard Curtin, director of the University of Michigan’s Surveys of Consumers, said consumer behavior due to COVID-19 is to be expected. In a statement, he said: “The latest data from the University of Michigan’s consumer sentiment surveys indicate that the coronavirus has reduced consumer optimism and, more importantly, it will continue to do so as the virus spreads in the weeks and months ahead. The panic atmosphere that has developed, however, is quite unlike anything that today’s consumers have ever experienced. It is now primarily based on fears about personal health rather than personal finances…In stark comparison, there is little evidence that the panic is due to the escalating downturn in business activity and mounting job losses.”
Ball State University experts gave a more dire outlook. Extreme social distancing occurring in the United States is more than sufficient to create a recession as mass layoffs cause unemployment to exceed 10.5 percent nationally, says a new report from Ball State University. And, within 90 days, the economic downturn caused by governmental efforts to mitigate the novel coronavirus will cause unemployment to rise to 14.6 percent nationally. This could cost the U.S. economy about $7 trillion, said Michael Hicks, a Ball State economist and co-author of the study.
Recession job searches
Experts say people who have experienced a layoff may need to work hard to get noticed in the weeks and months to come by employers. “For job-seekers, finding work during a recession is difficult because your application is likely sitting in a very large pile joined by hundreds of others who are recently out of a job,” said Bob Funk Sr., head of Express Employment Professionals, an employment agency company that is headquartered in Oklahoma City. Funk says working with a firm that can match your skills to current openings will cut down on time spent unemployed.
Zoom council meetings
City governments are adapting to these new times with different forms of communication. Effective this week, the city of Huntington Woods will host all essential city board and commission meetings remotely via Zoom video chat until further notice. The first virtual meeting will take place Wednesday night, where the city commission will discuss declaring a State of Emergency.
Exercise and related businesses are getting creative with online offerings. In an effort to help students stay connected during this time, as well as offering opportunities for physical activity and to practice dancing at home, Fred Astaire Dance Studios Michigan now offers an online dance lesson platform, which launched Monday. In collaboration with the Fred Astaire Dance Studios national franchise, there are a total of 38 free dance lessons online, and an additional 36 fee-based lessons for people to access. From a business standpoint, the fee-based dance lessons are a way to keep business going, while ensuring that instructors who teach those lessons have an income stream, officials said.
Some small-business owners are asking community members to contact their elected officials to advocate for these employers, who are considered the backbones of their local economy. Others are continuing to do “GoFundMe” sites to raise money for their staff, who may have had to be laid off because of the economic impact from COVID-19.
Even Free Little Libraries and Little Pantries are reacting to the impact. Some are taking the doors off of the front of their boxes so that people do not have to touch a common handle, possibly spreading the virus. In Oak Park, for example, organizers started a new Facebook page to update people on needed donations. “Let’s keep our spirts high during this time of need,” page organizers said.
“Family and employee health anxiety is too high to have students return to school prematurely. Opening too early will lead to numerous challenges, mainly extreme levels of student and employee absences that will undermine the expected learning experience in schools,” Detroit district superintendent Nikolai Vitti wrote Monday in an open letter to Gov. Gretchen Whitmer, state Superintendent Michael Rice, and the state Board of Education.