The agency’s reversal of its May 13 decision to relax mask requirements was a reminder that — 16 months after the pandemic first torpedoed the U.S. economy — the crisis is not yet vanquished.
Wall Street economists largely brushed off the dollars-and-cents impact of the CDC’s recommendation and insisted the economy is likely to steam ahead. But with the delta variant quadrupling coronavirus infections in July, corporate chief executives are growing worried about bringing workers back into crowded offices, a move that many employers have scheduled for September.
While the immediate dangers seem manageable, uncertainty over the future course of an unpredictable pathogen is rattling the most confident executives and unsettling many of their employees.
“I sense a lot more anxiety than a month ago,” said one chief executive who spoke this week with several chiefs of large companies and spoke on the condition of anonymity to be candid. “But I’m not sensing panic, and I’m not sensing a change in business plans.”
The CDC recommendation for the vaccinated to resume indoor mask-wearing in areas of “high” or “substantial” coronavirus transmission is catalyzing executives’ worries that additional steps — including mandatory vaccinations — may be needed to ensure a safe return to normal operations.
Likewise, some travel and hospitality companies report wobbly demand, even as overall consumer spending overall remained solid in June. Jonathan de Araujo, owner of the Vacationeer, a travel agency that specializes in Disney vacations, said cancellations have picked up in the past week, with more families expressing concern about the delta variant. Bookings, he said, had just begun to rebound after having fallen by 90 percent in 2020.
“People are rescheduling trips, canceling trips, saying they’re concerned about kids that are not vaccinated,” said de Araujo, in Watertown, Mass. “The majority are still taking a wait-and-see approach, but we can definitely feel things starting to change.”
Wedding planners said couples are moving indoor events outside or paring their guest lists, hoping to “get married now, in case we all have to go back underground again,” said David Wood, president of the Association of Bridal Consultants.
Wood said his daughter and her fiance, who are getting married in August, recently moved their ceremony outdoors and slashed the guest list by more than half. They are also requiring guests to show proof of vaccination.
“We talked about it and decided we don’t want anybody to get sick,” Wood said. “We don’t want to start any sort of superspreader event. We did everything we could think of to keep everybody safe.”
The CDC’s decision to tailor its mask policy to conditions in individual counties means a patchwork of rules will govern the $21 trillion U.S. economy rather than the sort of uniform national standard companies prefer. Uncertainty about the protocol in each elevator, office, conference room and factory will increase friction in the economy and could also impede decisive corporate action.
At Equinox, the chain of high-end gyms, for example, mask requirements apply to members in Southern California, but not in Virginia or Texas. Most other locations, including Boston, Chicago and New York, require that only the unvaccinated wear masks, according to the company’s website.
In Eureka Springs, Ark., where just 36 percent of residents are fully vaccinated, managers at a local boutique this month resumed requiring masks and may temporarily close if coronavirus cases continue rising.
“We’re the only shop in town requiring masks and we’re losing some business because of it,” said a general manager, who spoke on the condition of anonymity to avoid retribution from local residents. “We’ve had people kick our door and drop the f-bomb at us, but I don’t care. The vaccination rates here are pretty scary. It’s just not worth the risk.”
On Tuesday, Ford Motor told employees it was reinstating mask requirements at a facility in Florida and at its plant in Claycomo, Mo., which manufactures the popular F-150 pickup. Earlier in July, General Motors imposed a similar mandate on workers at its Wentzville, Mo., plant, about 200 miles east of Claycomo.
On the CDC’s online national risk map, all but six of Missouri’s 114 counties are colored red for “high” levels of community transmission, as is the entire state of Florida.
The CDC also recommended masking for all students, teachers and school staff for the fall educational calendar, which could complicate back-to-school calculations affecting millions of women who are expected to return to the workforce.
“That would be a pretty major negative. There are a lot of knock-on effects from schools only being partially open,” said Michael Feroli, chief U.S. economist for J.P. Morgan. “I still think we’ll be okay. But [delta] may take a little bit of the shine off the second half.”
Despite C-suite unease, many economists remain sanguine about the outlook. Mobility and consumer spending data remain strong. Sherwin-Williams told analysts on Tuesday its residential paint sales were untouched by the flare-up of the virus, and Stanley Black & Decker said it might even enjoy higher do-it-yourself sales if the runaway virus forced more people to stay home.
The share of American adults who are fully vaccinated continues to creep higher, and hospitalizations remain lower than during the worst days of the winter coronavirus surge. Some economists take solace from the experience of Britain, where the delta variant first spread. Case numbers there rose by a factor of 10 starting in early June, but quickly peaked and in recent days have begun declining.
Steven Blitz, chief U.S. economist for TS Lombard, said the delta outbreak could delay some planned office reopenings until later this year or early next. But masking guidance is unlikely to be followed in states with the lowest vaccination percentages.
“I personally think it’ll end up being not a big deal,” he said. “I’m not sure how much anyone is going to follow it.”
Gema Zamarro recently pulled her two children out of summer camp in Arkansas amid rising coronavirus numbers. Although the camp required masks, her children, ages 8 and 10, were the only ones wearing them, she said.
“We were watching the situation get worse and got scared — nobody has worn masks since May, when the CDC said vaccinated people don’t have to wear them,” said Zamarro, a professor of economics at the University of Arkansas. “But my kids aren’t vaccinated and with cases going up, it just felt too risky.”
Although she is vaccinated, Zamarro says she began taking extra precautions again. She recently canceled a trip for an academic conference in D.C. and is questioning a family trip to Spain for Christmas.
She and her husband, she said, are back to ordering groceries instead of going to the supermarket, and they are limiting family outings to outdoor activities like hiking and swimming.
“It’s been over a year since we’ve had a normal life, and now we’ve stepped back again,” Zamarro said.
The International Monetary Fund on Tuesday released its latest forecast, showing the United States would grow at an annual rate of 7 percent this year, up from an estimated 6.4 percent in April.
But with the federal moratorium on evictions ending July 31 and enhanced unemployment benefits scheduled to expire in early September, there are risks to those cheery forecasts.
Mike Roman, CEO of 3M, acknowledged “heightened concern over the increase in delta variant cases” on an earnings call, while UPS flagged “a lot of uncertainty” about the latest mutation of the coronavirus.
Beth Ann Bovino, chief U.S. economist for S&P Global Ratings, said she saw no sign in the economic data of any delta-related deterioration. But she acknowledged the difficulty in assessing what the next several months will hold.
“I’m nervous. And I’m vaccinated,” she said. “I have some business trips planned. Will they get canceled?”
Jennifer Murray, of Tunnelton, W.Va., who is considered high risk for complications from covid-19 because of chemotherapy for breast cancer, recently canceled plans to attend a family reunion.
The legal transcriptionist stopped going to the grocery store and local restaurants after the CDC lifted mask requirements in May. She is rethinking a vacation to Smoke Hole Caverns in Cabins, W.Va., and the $600 she spent on tickets for a Chris Stapleton concert in September. She’s already twice postponed a Disney World trip and is at a loss for when to reschedule.
“I was so happy when we got vaccinated, thinking, ‘Oh, yeah, we’re going to get to travel and go places again,’ ” said Murray, 47. “But now we’ve realized: No, that isn’t actually the case. We’re wearing our masks in public again, wondering how much worse this is going to get.”
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