Several Cities are Financially on the Ropes

A number of America’s cities have taken a beating during the Wuhan virus pandemic.

Thanks to lockdowns and other draconian measures that have disrupted daily lives and commerce, many cities have witnessed notable economic downturns. According to WalletHub, Las Vegas is the number one city where people are facing “financial distress” during the pandemic. WalletHub’s rankings used averages in various categories which included credit scores, the average numbers of accounts in distress and changes in the number of bankruptcy filings from June 2019 to June 2020. The 10 cities most in distress are Austin, Chicago, Dallas, Fort Worth, Houston, Las Vegas, Los Angeles, Miami, Phoenix, and San Antonio. On the other hand, cities like Anchorage, Alaska; Madison, Wisconsin; Jersey City, New Jersey; Fremont, California; and Newark, New Jersey have experienced the least financial distress. 

According to the U.S. Bureau of Labor Statistics (BLS), the national unemployment rate stood around 7.9 percent in September. In contrast, the unemployment rate was at 3.6 percent back in January. However, the actual rate of unemployment was probably around 26 percent, according to an Axios report

Hawaii (15.1 percent) and Nevada (12.6 percent) led the nation in terms of unemployment rates, which was largely brought about by lockdown policies in states that are reliant on tourist activity. Las Vegas was one of the prominent urban centers which experienced significant distress in the past few months. However, there has been some positive news lately. Casinos are beginning to gradually re-open and employment in leisure and hospitality sectors  increased by 318,000 people in September. According to numbers from the BLS, 69,000 jobs were added in amusement, gambling and recreation sectors.

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Orlando, Florida was another tourist center which fell in WalletHub’s top 15 rankings for cities experiencing financial distress. However, it has also been gradually bouncing back after the reopening of Walt Disney World Resort. When the pandemic started, the parks furloughed 70,000 workers, which played a significant role in bringing about the leisure and hospitality sector’s alarming 40% unemployment rate back in April.

Lawmakers in D.C. and state legislatures nationwide need to recognize that any kind of lockdown policy would be disastrous for Americans. There are common sense alternatives to handling the pandemic without having to destroy the economy and the livelihoods of millions of people. Hopefully, our leaders come to their senses and recognize that there can be pragmatic compromises that balance public health while still maintaining most economic activity intact. Continuing these lockdowns is the height of insanity and will provoke all sorts of socio-economic instability.

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