Hopes for a quiet start to 2021 were quickly dashed amid unrest in the nation’s capital, progress toward substantial stimulus, a surprising 50-50 Senate outcome, and a mix of excitement and frustration over COVID-19 vaccine availability. While we hope this year will be less volatile than 2020 was, January was anything but relaxing.

We start the year without much economic momentum. Indicators on hiring and retail sales show a slowdown. But real growth is likely to accelerate as the year progresses. Additional stimulus will help to move consumers and businesses past this difficult interval, and additional inoculations will help consumers return to their old spending habits. A robust recovery in demand across all sectors will support ongoing employment gains during the balance of 2021.

In the cold and dark months of winter, it is helpful to envision better days to come. At the moment, we continue to ride out the effects of the pandemic patiently.

USEO - Chart 1 - 02/08/21