We have not truly hit the point yet when the data will truly show the impacts of COVID-19 on the Grand Forks economy. That is, what we see is just the beginning. With lots of concern turned toward the ways the economy will show these issues and will change going forward it pays to pause and take a look before we get too deep into the weeds.
To that end I created a smoothed out graph of sales tax collections by removing the seasonal component. It makes it a bit easier to see the overall direction of the series without all the different ups and downs.
There is a clear upward movement overall with some possible cyclical fluctuation in the data too. The city reported the value for May as roughly 10% below May of 2019. These collections are typically from two months prior so this reflects March data. Now March is likely not the worst of the data we will see, that is probably reserved for the April data, which we get in June.
There is a bigger issue at play here though. The fact is lower sales are a problem, but the composition of the lower sales is an issue too. What do I mean? Think about spending on food. There was less opportunity to eat from restaurants, but people probably spent some of that money on grocery store food and made more or different foods at home. So at a very real level the decline is less drastic than the actual economic effects we may see.
This applies going forward as well. Distancing rules and capacity restrictions keep various types of stores and retail establishments under pressure right now and going forward. Some of these situations will be pushing the businesses close to a shutdown decision in the near future, if they have not dealt with it already. We will get some of this data soon and can attempt to parse out the various issues but the worst impacts may still be ahead of us.