Detroit November 2020 – Key Takeaways

• Despite the ongoing pandemic, all Members report that they remain busy; are so busy that they are working 6 to 7 days a week. 
• Litigation work is picking up pace as legal consequences from the disruption in business is finally coming to light.
• Phil Seaver reported that a study on the productivity of at-home work versus in-office work reveals that at-home work is only 60% to 64% as productive as in-office work.
• Banks and other lenders are more on the sidelines only offering loans to businesses that they have relationships with.
• Tom Barrett, our banker from Flint indicated, ”We are trying to close out the year and doing strategic planning where we can.  I have been actively engaged in PPP forgiveness, sending files to the SBA for forgiveness review.  Loans that were above $2 million will get more scrutiny.  Everyone has to request forgiveness in order to get it.  There is an “easy” form many qualify for.”
• The U.S. economy has come back stronger than expected. The GDP is only a 3.5% below end of 2019.  The Fed is looking for 4% economic growth over the next year, unless parts of the economy are shut down.
• Holidays:  consumer spending is up 1% to 2%.  Expect to see a 5% to 6% increase in durable goods over the holidays.  Demand is still high for furniture, cars and food, etc.  Apparel, health care, hospitality and travel are still constrained due to the pandemic.
• Unemployment is at 6.9% now.  Labor force participation is 2% below the pre-pandemic mark.
• Retail is surprisingly pretty good now.  Places like PetSmart, Burlington Coat Factory, BJ’s, and First Watch are doing well.  There have been an influx of seafood and crab restaurants.
• Rents have not gone down, but construction is very costly now.