The U.S. economy has experienced an unprecedented year. The economic rollercoaster was filled with unexpected declines, sharp rebounds and unparalleled stimulus that created a heart-pounding, white-knuckled thrill ride for businesses across the nation. Many business leaders were left wondering what’s ahead as the nation emerges from the most radical economic incident in recent history.

Western Alliance sought out leading national economist Dr. Christopher Thornberg, founding partner of Beacon Economics, a prominent independent economic research and consulting firm, to provide in-depth analysis of how the COVID-impacted economy will fare and what can be expected in the coming months and years.

Recovery was significantly sharper between this two-month recession compared to previous downturns. Some data of note from the report:

  • By the end of 2020, the U.S. economy had regained 70% of the activity it had lost in the two-month recession.
  • Consumers were taking the demand from inaccessible opportunities, including travel and amusement, and redirecting it to goods such as homes, automobiles and other commodities, leading to a surge in corporate profits across the board. Such spending has led to a housing market that is experiencing record price increases and incredibly low inventories.
  • Retail sales continued to climb; compared to the same time last year, sales were 10% higher in Feb. 2021.
  • Manufacturing and industrial production matched peaks seen over the past 30 years.
  • The Federal stimulus allowed Americans to double their savings relative to 2019, from $ 1.23 trillion to $2.85 trillion.
  • Conversely, the massive increase in money supply due to stimulus spending has created an inflation risk unlike any seen since the 1970s.

To learn more about Dr. Thornberg’s in-depth analysis of the impact of the pandemic on the national economy, download Western Alliance Bank’s June 2021 National Economic Intelligence Report here.