Category: Economy

Alabama Bankers Association CEO Says Banks Are Secure During Pandemic

The COVID-19 pandemic has many people wondering about their economic future and the safety of their money. Banks report experiencing more cash withdrawals in the last few weeks. In fact, demand was so high at one Manhattan bank that it temporarily ran out of $100 bills.  Experts say hoarding cash can be risky, both financially and to your health.  Scott Latham is President and CEO of the Alabama Bankers Association. He says banks across the state have been preparing for a crisis of this magnitude for years with help from the Alabama Recovery Coalition. Read more.

Falling Tax Revenue Looms for State, Counties, Cities

Late April will bring financial pain for state and local governments as businesses in Alabama begin submitting lower taxes because of the coronavirus.
With most restaurants, hotels and retail businesses either shut down or seeing little customer traffic, government officials expect a sharp decrease April 20 when they receive March sales and lodging taxes. The notable exceptions are sales taxes from grocery stores and online merchants.
The situation has become so dire that the Alabama Department of Revenue is offering relief to hotels that are unable to make timely payments on their February, March and April lodging taxes. The department will waive late fees through June 1. The state is giving similar help for sales taxes on a case-by-case basis for merchants whose sales are affected by the virus.
Read more.

Layoffs, Job Losses — COVID-19 Impact Expected to Play Out Over Months

You don’t have to get infected by the coronavirus to see it have a painful impact on your life, as many workers – or former workers – have discovered.
Christine Prichard, a freelance photographer based in Birmingham, has seen the impact of COVID 19 in a couple of ways. First, her teenage son is in the Dominican Republic and she’s eager to get him back home, even though that would mean two weeks of quarantine with him.

But like many others, Prichard is seeing her business affected by the pandemic, as well.

She frequently shoots photos of corporate events, and late last month, at an annual celebratory event for a trade group, she saw an early sign that the pandemic was going to have an economic downside for her work.

“It was their annual meeting to kind of celebrate their sales. And at that meeting every year they would announce where they would book their annual trip for the top sales people of this product. And there was a guy that had to announce that they were not going to book the trip, pending what’s going on with coronavirus,” she recalled. “He said, ‘It’s just too iffy. We don’t want to lose deposits. We’re being super-careful.’”

That, Prichard said, was “kind of the first little wind I got that, ‘Oh. This could really be an issue.’” Since then, she said, “I haven’t done an event in a couple of weeks.”

From gig workers, to teachers to even health care workers and others, many are finding that the pandemic has reached into their pockets.

The pandemic has economic forecasters talking about recession in the wake of massive jobs losses. The headlines are about plants closing, unemployment claims rising, the government working on details of stimulus relief to American workers – and failing to come to terms. An NPR/PBS Newshour/Marist poll said that by last Wednesday, “nearly 20% of U.S. households have experienced either a layoff or a reduction in work hours because of the coronavirus.”

Unemployment filings are rising significantly. Preliminary Alabama Department of Labor numbers show that more than 17,000 people filed for unemployment on Sunday and Monday, the Associated Press reported. In the week that ended March 13, that number was 1,434. Read more.

Birmingham City Council Approves Final Piece of Funding for a Small Business Loan Program

The Birmingham City Council on Wednesday approved spending $1 million from its General Fund on a small business loan program designed to help small businesses struggling with the impact of COVID-19. The money is in addition to $200,000 put in the program fund Tuesday from the city’s innovation and economic opportunity fund. Read more.

Crisis Highlights Digital Divide in Alabama

As the state grapples with education, government and industry closures in response to the coronavirus, the digital divide across the state is probably the most apparent it’s ever been. Much of rural Alabama doesn’t have the infrastructure to take broadband Internet into homes.

“You have one-fifth of the state population that doesn’t have access,” Sen. Clay Scofield, R-Guntersville, said.

The chasm is perhaps most evident in schools, where administrators are faced with decisions when some of the students can partake in online learning and some cannot. Read more.

Pandemic Upends Alabama Tourism Industry

Facing canceled events, closed venues, mounting revenue losses and growing layoffs, Alabama’s tourism and travel industry is digging in for what could become an extended battle with the coronavirus pandemic.

As in every segment of global society, the state’s hospitality industry is struggling with the uncertainties of how severely and how long the crisis will affect everyday life.

The stakes are obvious in a state that depends on the travel and tourism for 7.3 percent of its gross domestic product. The industry brought $15.5 billion to Alabama in 2018 and created an estimated 198,891 direct jobs, according to the Alabama Tourism Department’s latest annual report. Taxes paid by tourists saved each Alabama family $507. Read more.

Major Events Affected by Coronavirus.

Signs of the Times

Bandit Patisserie and Steel City Pops in Homewood are two businesses trying to make it through the COVID-19 pandemic. One will bring you pastry to the door, the other invites you in – though you still have to take your treats away. For a comprehensive view of BirminghamWatch’s COVID-19 coverage, go to the coronavirus tag above.

Virus Impact: Revenue Delays Tax Liabilities, Lawmaker Looks to Protect Business From COVID-19 Lawsuits

As more businesses are ordered shut and workers laid off, state leaders say they’re looking to help establishments that lost customers because of the new coronavirus and protection for those still operating.

Sen. Arthur Orr, R-Decatur, said that when lawmakers return to Montgomery, he’ll file a bill offering civil immunity from coronavirus-related lawsuits. Orr said national and Alabama economies are being crushed by COVID-19 and businesses are closing to the public out of fear, concern or government mandate. Read more.