Fewer jobs, more wine: California’s deadly COVID year in 9 charts
On March 19, 2020 Gov. Gavin Newsom announced a statewide shelter-in-place order. In response to an unprecedented public health threat, it was an equally unprecedented shuttering of day-to-day life. “This is not a permanent state,” Newsom assured us at the time. “This is a moment in time. And we will meet this moment together.”
On Friday, that moment will have stretched — and stretched and stretched — into a year.
The changes that have racked Californians are big and small, obvious and subtle. We can mark them by the daily toll of this terrible virus, the days spent out of work or out of school. But also in the pictures of empty beaches and baseball fields, the collection of face masks hanging on front-door knobs, the time we didn’t spend sitting in traffic, the odd hobbies we took up and the friends we miss.
All of these changes have left a data trail. In highway crash statistics, unemployment claims, anti-Newsom lawsuits and florist sales, the numbers present a “before” and “after” picture of these last surreal, lonely, heartrending, life-ending and life-altering 365 days.
The booms and (mostly) busts of the COVID economy
No beers to buy after work. No decor to buy for weddings canceled. No need for new shoes when you spend 18 hours a day shuffling around the house in your slippers.
The last year has seen a radical change in consumer behavior — your behavior. California’s tax collectors break down the state’s sales tax haul by business type, revealing who has lost out and the few lucky winners.
For white collar Californians who have kept their jobs — and who, for lack of anything else to do, have actually been able to save money — 2020 has been the year of home improvement. This is the year they rushed to outfit their living rooms-turned-offices with standing desks, surged to Home Depot and took up gardening.
Among the losers: Canceled and pared down weddings, birthdays, quinceaneras and bar mitzvahs have all summoned fewer floral arrangements. The work-from-home year has also been a dismal one for shoe sales. There’s the obvious lower bar tab because the bars all closed.
But lest you think that means we’re all living healthier lives, the tax revenue may suggest otherwise: Beer, wine and liquor stores have been raking it in. We’re all just drinking from home now.
The jobless rate alone can’t capture the scale of economic crisis
At the same time that businesses shuttered and hospitals filled, millions of California workers lost their jobs. Many have spent much of their time ever since trying to get jobless benefits from the state Employment Development Department and its vendor Bank of America, sometimes making calls that went unanswered, only to finally exhaust all of their allotted benefits and left to hunker down through a brutal winter.
Now both claims and fraud reports are sky high and the situation is dire, even compared to the Great Recession. There are more people unemployed today, the state’s insurance fund is tens of billions of dollars in the red, and at least 2.5 million people were denied further financial assistance since March of 2020. Meanwhile, the state’s unemployment department has made millions from fees on debit cards it issued as jobless benefits. Help is on the way for some as the passage of the $1.9 trillion American Rescue Plan Act provides more money for unemployment insurance, though the exact amount will depend on the specifics of their case.
One of these recessions is not like the others
In the winter of 2001, the Silicon Valley dot-com bubble burst, eviscerating a raft of promising online ventures like Pets.com, but also dragging California’s tax revenues down with it.
Seven years later came another crash — a big one. The credit-fueled housing bubble popped and Wall Street, which had spent years raking in paper profits off of the IOUs, went to pieces. Once again California’s state finances, dependent as they are on the good fortunes of the investor class, went to pieces along it.
But this economic catastrophe is different. The collapse of the service sector has devastated low-wage workers and many small businesses. But record-low interest rates, a raft of stimulus checks and a surging do-everything-from-home tech economy has been great news for the stock market on the whole. And that’s meant a surprisingly good tax haul for the state of California.
The chart above tells the story. The two prior recessions are easy enough to see: vertiginous drops in state revenue off the sale of stocks and other investments. But in 2020, the good times just never let up on Wall Street. Nor at the state tax collector’s office, which derives the lion’s share of its takings from the One Percent.