The coronavirus-driven economic downturn will deal a significant blow to the Austin area’s population and job growth in 2020 and 2021, according to a local economist.
Angelos Angelou, founder and CEO of Austin-based economic development and site selection firm AngelouEconomics, anticipates the Austin area adding only 35,000 residents this year and 45,000 next year, compared with roughly 55,000 to 65,000 a year in the 2016-19 period.
Angelou says his projection of lower-than-usual population growth stems from the tendency of people to stay put and not risk a move during difficult economic times.
“But, rest assured, if the economy is going to start improving, Austin and Texas are typically significant beneficiaries of a new influx of immigration from other parts of the country because this is probably the best place to find a job when the economy recovers,” Angelou said during an April 21 webinar sponsored by TiE Austin, a nonprofit group that promotes entrepreneurship.
However, fewer jobs will be available in the Austin area in 2020 and 2021 than in the recent past, Angelou predicts.
Angelou forecasts the Austin area will lose 45,000 jobs in 2020 and add just 29,000 jobs in 2021. From 2016 through 2019, the Austin area posted annual job gains ranging from 32,000 to 37,500, he says.
In 2020 and 2021, the hospitality, leisure, and retail sectors will bear the brunt of the region’s job losses or weak job growth, he says. Angelou expects many “marginal” small restaurants in the Austin area to go out of business.
“Retail is going to be gruesome. A lot of retail businesses are going to fail,” Angelou says.
The hospitality, leisure, and retail sectors represent 22 percent of the area’s workforce and 11 percent of the area’s income, he says.
“It’s going to be a slow recovery,” Angelou says. “Some sectors will recover faster; other sectors will recover slower.”
“If we open up [the economy] too soon and somehow we have a spike in new cases of coronavirus,” he adds, “we’re going to have to shut down the economy again, and that will be devastating.”