Head of U.S. Economics
BofA Global Research
Consumer activity on the rise despite an uptick in COVID cases
Virus cases and hospitalizations are increasing again as colder weather in the Northeast and Midwest are shifting more activities indoors. Daily cases rose by 9.7% to 77.3k in the week ending November 12.1 Meanwhile, new hospital admissions are also on the rise, increasing by 7.8% in the week ending November 15.2 The good news is that more than 70% of the adult population has been fully vaccinated.2
Consumer activity benefited from the timing of the Veterans Day holiday. Air traffic increased 4.1% from the prior week but still remains down 16.7% relative to 2019.3 Seated diners were also up 2.3% relative to 2019 in the week ending November 15.4 In addition, Eternals, the latest Marvel movie, was released and resulted in a sharp increase in box office receipts for the week ending November 11.
In the labor market, hiring activity cooled in November, according to data from Homebase, but labor demand remains strong as job openings on Indeed were up 52.4% as of November 12 from February 1, 2020.5 Meanwhile, high propensity business applications are up 36% year-to-date from the same period in 2019, further supporting labor demand as businesses begin building out their staff and operations.6 In addition, initial jobless claims continued to decline, falling to 267k marking the 5th consecutive week of claims below 300k.7
While COVID cases are rising, there is hope that the economic headwinds from another wave would be more modest than prior waves in part due to higher vaccination rates and natural immunity. Consumer activity data benefited from the timing of Veterans Day but also indicate an ongoing gradual recovery. The labor market continues to show a strong recovery with the decline of initial jobless claims and a surge in labor demand.
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- TSA, Data through November 8, 2021
- OpenTable, Haver Analytics Data through November 8, 2021
- Indeed, BLS, Data through October 29, 2021
- BEA, Data through October 30, 2021
- Department of Labor, November 6, 2021