Dear Business Partners,
Illinois businesses took the most meaningful steps toward recovery when it entered into
. Physically, mentally and psychologically the recovery efforts began in earnest. Less than a month removed from entering what is deemed the recovery phase, many of us continue to ask what will recovery look like? Here we will attempt to provide a framework for understanding the shape of recovery and what it means. Economist have developed a shape model to help articulate the nature of recovery.
recovery: is identified by the economy bounces back quickly to its baseline before the crisis, without noticeable signs. Growth resumes at the same rate as before. This is the most optimistic recovery pattern. It implies the downturn did not cause any lasting damage to the economy.
recovery: economic damage lasts for a longer period before returning to the baseline level of growth again. The economy bounces back, but the impact at or near the bottom lingers for a period of time.
pattern is also referred to as a
, the economy moves beyond a recession into a period of recovery before faltering and returning to recession. Eventually, the economy returns to the baseline of previous growth.
this pattern is characterized by a steep drop and a gradual recovery, it takes much longer to return to pre-crisis growth levels than it took to fall into recession.
this is the most pessimistic view. The economy recovers to a certain level from a steep drop, but growth never reaches pre-crisis levels for years if at all. A period of economic stagnation.
The timing and the shape of the recovery is not a certainty, but it will be high on the agenda for executives. Post pandemic planning is in full swing
. What economic scenario is your company currently operating under?
The answer to this question is likely driven by the economics of your industry, your community and your customers. In our upcoming issues we will explore what each means for you and your business.
Let us know what scenario you are planning for as the primary recovery. Do you have a plan B scenario? You can find more business resources at
. Also please contact us at 309-494-8640 or
for any questions or assistance. We look forward to rebuilding Peoria together.
Kevin S. Evans
Senior Economic Engagement Specialist