This article is part of an ongoing collaboration between the Colorado School of Public Health, the Denver Museum of Nature & Science, and the Institute for Science & Policy. Find all of our previous COVID-19 webinars and recaps here.
It would be nearly impossible to overstate COVID-19's disruptive effects on the economy. As the virus took hold in early 2020, lockdowns and restrictions brought some businesses to a screeching halt, many of which have still not fully recovered. Frontline employees in sectors like hospitality, retail, the arts, and more found themselves out of work indefinitely. Policymakers have faced difficult decisions - and no shortage of criticism - over how and when to reopen while balancing public health with fiscal health. The state of the economy encapsulates all of the challenges and tradeoffs inherent in navigating a once-in-a-generation pandemic. So where do we go from here?
We chatted with Michael Hancock, Mayor of Denver; Deborah Jordy, Executive Director of the Scientific & Cultural Facilities District; and Ed Sealover, Senior Reporter at the Denver Business Journal, about trends across different sectors and the outlook on what the near future will look like for cities and communities.
This transcript has been lightly edited for length and clarity. Watch the full recording here.
MICHAEL HANCOCK: Thank you for having me here. I'm really excited to spend some time with you this morning. To my friends Deborah and Ed, good morning to both of you as well.
When I first started college, I took a course called “Politics of the ‘60s.” The professor started the very first class in this manner. He said you can sum up the ‘60s in these terms: assassination, assassination, assassination, assassination. Kennedy, Kennedy, Malcolm X, King. War, resignation, and then rebuild. We have just faced the most unprecedented year and so I started thinking about 2020 through March of 2021, and we can begin to sum it up simply in this manner: pandemic, shutdown, mass demonstration, protests, presidential election, insurrections, all in a matter of 12 months. To say 2020 and the first part of 2021 were unprecedented is to really, I think, understate what we as a society, as Americans, have just gone through.
Today, in Denver we wake up with 529 less souls than we did at beginning of 2020. 63,000 people in this city alone infected with the COVID virus. 128 million people worldwide. The reality is, simply, we have been changed, not just by COVID, but the reckoning on social justice that we saw happening around the world. Many of us witnessed that terrible video of the murder of George Floyd in Minneapolis last May. In 2020, as Mayor, I was faced with the toughest decisions I've ever had to make. It was a question of how we balance saving lives and livelihoods. And at some points, I had to make decisions that it's about lives. We can rebuild livelihoods, even knowing that the decisions would devastate people and hurt families and disrupt or destabilize families all over the city.
Today though, we have a light at the end of the tunnel. We began the process of moving from rescue to recovery. We're still in the phase of trying to get needles into as many arms as we possibly can in the city of Denver, building the infrastructure so folks can access this very important vaccine so we can begin the process of recovering, not only economically, but socially, culturally and psychologically.
So the goal today is to continue to try to get people vaccinated, and hopefully in a few more weeks, we'll be able to say we could turn the switch to recovery, putting people back to work, helping people to begin to stabilize their lives, bringing people back to the centers of our city. This is one of the most vibrant economies in the country.
And I'll close simply by saying this: Cultural and arts institutions and organizations will lead the way. People are so excited and have such pent-up plans and energy to get back out, see live music, live performances, to walk through some galleries...just to touch, to laugh and to enjoy leisure that we have in Denver and throughout Colorado. I'm excited to be here today because I know that the Denver Museum of Nature and Science plays such a critical role in that. And all of you, as patrons of all of our cultural and arts facilities: you play a role in driving our economy, but you'll be the leading blockers downfield as we try to rebuild this economy brick by brick and begin to restabilize folks in our city. So, again, Kristan, thank you for having me. I look forward to the conversation.
KRISTAN UHLENBROCK: Thank you, Mayor, for that really nice hopeful message. I'm seeing comments in the chat that people really appreciate your leadership and your joining us this morning.
I want to pick up on something you said, which comes down to really tough decisions that you've had to make. The idea is that there were tradeoffs that had to be made between people's lives and livelihoods, and people have criticized government leaders for decisions that they had to make. What are some of those tradeoffs between proactive versus reactive policies that you had to make where you think we did a good job, and maybe where we didn't do such a good job?
MH: Great question. Denver was the first city in the state to implement a stay at home mandate and a mask mandate. Those were proactive realities. We knew this virus was here, that we were fighting something we couldn't see, smell or touch. And that's scary. But we also didn't realize how long and how extensive the impact of this virus would be. We knew people were dying. We knew people being infected.
And so I'll never forget the day that I sat with the staff and the public health directors, and we made the decision to shut the city down. It was in mid-March of last year. Interestingly enough, just five minutes earlier, we had devised a strategy to encourage people to social distance, wash their hands, but continue to patronize our restaurants. That's what we were going to push. But as the staff walked out, and we started getting more and more alerts in about five minutes about the spread of the virus and about deaths occurring, everyone walked back in my office and said Mayor, we need to do something different, and the public health directors began to advise me and strongly recommend that we take more decisive action. It was at that moment that I decided to shut the city down. We had been in conversations with the Governor, we knew it was one of the options. We knew it would be a tough call, but also the right call to stabilize. I believe that early decision, along with our mask mandate, saved lives in our city.
KU: In the time of the pandemic, we also have seen transformation happening, new ways of doing things. From your perspective, what are some of these transformational changes that you think are here to stay?
MH: We're going to have a new culture with how people report to work, if they report physically to work. I didn't know about Zoom before the pandemic. I mean, how many of you all heard about Zoom and [Microsoft] Teams before? I know none of this stuff. But we've found that we can actually communicate, get business done, and be productive through Zoom and this virtual reality that we have.
So I think you're going to see companies institute rotational remote working culture. I think it's still important for folks to be in person when appropriate. The ability to cross collaborate on issues and opportunities, the culture of getting to know your co-workers and building that spirit are still extremely important. But I do believe you're going to find people are not in in such demand for space, as they reduce the footprint of their companies. And I think that's going to make a difference. You're gonna find what we call “condominium cubicles,” where two, maybe three employees are sharing a cubicle based on that rotational strategy. We're going to do it in the city of Denver, we're looking at it now. I think it's gonna make a difference. We saw our employees be more productive, and that was a phenomenal finding.
KU: One question that we love to ask: the idea of trust government, trust in our institutions trust in science. How do we maintain trust and how do we really rebuild trust when it has been lost?
MH: This is a longer dissertation that needs to occur on this issue of trust, particularly when it comes to government institutions. I think we saw that there's nothing like chaos and controversy to show the true character of an individual or an institution. And I think that, you know, we all were exposed at some point or another, no matter what level of federal, state or local government.
But I believe that what you saw, particularly in the state and local governments for the most part, is that governors and mayors showed up and demonstrated leadership for their people. On the federal level, I think many of us are bewildered and disappointed in what we saw and what we experienced. Partisanship does have its limits and I think that when we are facing major challenges as a society, the last thing we want to hear about is red, blue, Republican and Democrat, Independent. We want to know what's in the best interest of the American people. Unfortunately, the federal government ran too far and too long with partisan politics, and people got turned off.
And so, a lot of pressure and a lot of focus was put on the local and state level. To some extent on the state level, they continue to play partisan politics and it affected the trust. I might be partisan, a bit biased, but I saw mayors step up, do things that were completely out of our box at times and say, this is not in the best interest of our people. I saw it in Atlanta, Georgia. I saw it in other cities. And it was tough because some of us were threatened with being arrested or fined heavily by the state. But in the best interest of the city are its people. At the end of day, it's not about me. It's about what's in the best interests of folks that I represent. You got to make those tough calls.
So when you talk about rebuilding the trust, I believe that when you have missteps -- in my career I've had them as well -- you put your head down, you work hard, and you do what's in the best interest of the job that you've been called to do. People recognize that more than anything else. Don't overreact. Don't overcorrect. Put your head down, go to work, work hard and show the ethics of hard work and labor and hopefully we'll see that on all levels of government very soon.
KU: Thank you, Mayor. I think that's a great way to wrap up a little bit of your time this morning. Thank you very much for your leadership. Thank you for joining us today. It's been a great pleasure talking with you.
MH: Thank you, Kristan. Enjoy your day, and let's run toward that light at the end of the tunnel. [Editor’s note: Mayor Hancock departed for another meeting.]
KU: Absolutely. Hi Deborah, hi Ed. let's bring you into this conversation. Deborah I want to start with you: can you reflect a little bit on something the Mayor said about how we are currently doing in our business and culture here in the state of Colorado? What’s on your mind this morning?
DEBORAH JORDY: The Mayor’s message was hopeful, so I'll talk about that, but what's on my mind this morning is that this was such a devastating year for all the cultural organizations and the creative workforce. That's artists and individual musicians, independent venues. It's been such a devastating year. What keeps me up is how many organizations we could lose in a slow recovery. You know, we've been really lucky that we've only aware of one of the SCFD organizations that was part of another organization that has closed. So it's remarkable that in this year, we haven't seen more closures of organizations.
But with the slow recovery in America, I see it as kind of a windy path, and there's such optimism, but there's also concern right now. We've got to keep thinking about how organizations can get there. So much is predicated on health orders. There’s concern about performing arts, because that will be the last discipline that would be able to completely recover. And the gig economy workers -- they've got a double hit because they're both bartenders and waitresses and actors and musicians and artists. So you know that they've been hit doubly in terms of lost employment.
There's so many more questions we have than answers. But the other piece is really funding and we can talk more about that as we as we go through this conversation. I'm always thinking about optimism, but we've got a lot of work to do this year.
ED SEALOVER: From my perspective, I'm still coming out of this year of ‘what have we lost’ and trying to reorient to ‘where do we go.’ Just for those who don't know me, I cover industries including tourism, restaurants, hotels, breweries, distilleries, some of the worst hit industries. So I've been buried for the past year in how bad this has gotten.
The number that I keep seeing is that 375,000 jobs were lost in Colorado in March and April of last year. We've done a noble job of recovering but there are still 160,000 jobs that haven't been recovered from that period. We're going to open up more, we're going to see many of our institutions be able to welcome more guests. We're going to see people going back out to events, to restaurants, to places like that.
But the question is: how much have we changed going forward? There’s 160,000 jobs we're still looking to get back, but not all of them are coming back. I'd love to tell you that the 94,000 restaurant workers that that lost their jobs in the course of 2020 will go back to that industry. They won't. We've changed our habits as a society. We have changed in a couple of ways and we've adapted to be more on our own and less together, whether that’s ordering meals in or watching our movies at home. And I think there are still questions about how much we go back to where we were and how quickly we do.
But I think one of the bigger more important questions, and the Mayor touched on this, is this idea of how efficient we can be working from home, which is great. But that's going to change our cities in a fundamental way for decades to come. If we don't go back to filling the downtown office buildings like the one I'm now sitting in -- literally alone in my office -- that's going to affect the restaurants, the retail, even the cultural centers that have made downtowns a place of gathering. At that point, where do those jobs go? How do we retrain the people who may not get jobs back in retail, in restaurants, in hotels, in other industries where you previously had to be present, but now don't have to be so much because now people are going to learn to take things in from home.
And beyond that, the bigger picture of how does that affect culture. I'm more of an expert on how business works, how our economy works. But I mean, the question is, if we separate ourselves more so than we did before, how do we get back together, how do we have those conversations, those face to face interactions that were really what brought us together? So that was covering a lot of ground, but I guess I'm still thinking through: Now that we are through the worst of it -- hopefully, we are through the worst of it -- how do we get back to where we're going and what parts of it never come back.
DJ: You know, I agree with you on so many things, especially with how do we revitalize our downtowns again. And whether it's downtown Arvada or Boulder or Denver, it's going to be businesses coming back to produce that ripple effect for restaurants, for our cultural organizations and people being together, which is what so much of what culture is about. Performing arts is sharing an armrest with people. There's an interaction, an energy in a theater or in a concert hall that you won’t get watching a virtual performance.
Now, that said, some of the changes we've seen, I think, are going to be in hybrid and virtual performances and classes. I know our culturals are working on it.
KU: Ed, the idea of this hybrid workforce: how does that play into retail and some of these businesses that rely on filling offices like you mentioned? What are you seeing in that realm?
ES: I there's going to be hybrids and I think a lot of employers are going to look into letting employees work a day or two from home, or at least have a more flexible schedule. And again, that's great. But it shifts our economic focus and our activity focus. These are numbers that the Downtown Denver Partnership put out that were stunning to me: before the pandemic, we averaged 250,000 people a day in downtown Denver. In November, there were 50,000 people a day in downtown Denver. We can't support a lively downtown existence with that kind of drop off, quite frankly.
Now, there have been changes covering the restaurant industry. I'll tell you, it's been interesting to hear from some of the Colorado based chains, places like Noodles or even a smaller chain like Mici, that say, you know, they've literally shut downtown locations because there's not a business model that they see going forward in what are still high rent districts with very low foot traffic. And yet, they're having record years in many of their suburban locations. We are now shifting to consuming food, consuming retail, consuming culture in the places that are closer to home, which is going to have effects on transportation and other areas too.
But again I don't think we can stress enough: if we don't get back to some semblance of gatherings or bringing people together in a downtown area, that's a long-term economic ramification that we can't just shift back to the suburbs and the small towns or other places.
DJ: You know, you talk about gathering and of course I go to performances. There been national studies showing that 83% say they're watching live stream performances, but only 14% say it's frequent, and 53% want to go back to in-person. And that is in January. So again, it just reinforces how there are these unanswered questions of where we are now and where we're going to be in the fall and a year from now with people's behavior. But I agree with you in terms of getting people back out.
ES: I'm often accused by some of my readers of being too negative on this, but there have been some wonderful things that we've seen with this hybrid change. I think of something like the Denver Film Festival, which brought in people from areas of the state that never came to it because it went fully online this year. So you're going to see organizations adapt to that. Major events, major conventions, major festivals will probably forever have some sort of an online component. That's going to be wonderful because it's going to bring in people who can't just get in their cars or get on trains and get to downtowns where these things typically happen and be a part of it. There are bigger picture ramifications, but I think there are some really good things coming out of hybrid life, if you want to term it that way as well.
DJ: It's about assets, it's about giving the opportunity for residents to attend the film festival for the first time, to have access to events they didn't before. So that's a plus.
KU: Any good examples of what you've seen from some of the cultural institutions that you work with?
DJ: On the virtual programming, culturals are nimble and they're creative and they think outside the box all the time. So when things hit, there were three areas organizations went to. Many of our smaller organizations just went into hibernation. A bunch of the mid sized and larger ones started immediately figuring out how to do online virtual programming. So you've seen everything from, you know, one of my favorites is taking a ukulele class with Swallow Hill, or a virtual tour or a free dance class at Wonderbound. Especially for kids. We're at home, so for parents it’s a way for their kids to blow off steam and have a creative outlet. So those are just a few examples of the ways we’ve seen virtual programming be successful.
The hard part is in monetizing it. We did a survey last September and 75% of the organizations said that they were trying it, but they were not successful at monetizing it. So we'll see how that evolves, because it's also about engagement and accessibility, but also in reality, can the organizations make this work from a financial perspective. But they’re trying all kinds of things, and other organizations were really reaching out to the community. Like at Cherry Arts, there was an arts festival last summer and they have all sorts of kits and supplies that were going unused that they gave to local schools. So again, it's about partnership and collaboration with with the culturals.
KU: Ed, please fact check me on this because I heard this from someone, that there was the largest number of new business applications ever in Colorado last year in 2020, which maybe speaks to both businesses struggling and going under and then people coming up with new ideas and being creative and adapting to the situation.
ES: I will semi fact check you on that, since I’m not sure about the highest number ever of new businesses. But I know that in the heart of the recession last year we saw an increase in the rate of filings for new business entities. Now, this is actually not unusual. This is something we even saw back during the Great Recession, that when people are laid off from their jobs, they're going to turn around and they're going to try something new. So a lot of people who had been working for years for a company, particularly in an industry like hospitality or healthcare that that saw a significant number of layoffs, went out and decided, okay I'm going to try doing this on my own.
I can think of one particular business that I've covered called Breakaway Meetings where it was two former hotel sector event planners that decided, well, we lost our jobs, here's what we're going to do: we're going to supply food and beverages for Zoom meetings so people can feel like they were actually at the regular meeting. But the question is, how sustainable are things like that? People have been incredibly adaptive and trying to come up with new ways and for the most part -- I think it's safe to use the phrase -- a lot of people have “gotten through” the last year. They've made it through between federal help and stimulus spending.
These good new ideas -- restaurants delivering drinks with their food, cultural organizations going online -- people have found a way to reach out. But you can't paper over the fact that revenues are down still, and without revenues, you can't run a business. So there's got to be some way that companies are going to have to merge that idea of, okay, how do I reach out more to people and to answer that demand for more service where I am, where I want it, rather than, hey, here's what time I'll show up to the show and see it.
And that's still the unknown: how much will people continue to order out versus order in. I'll say this, even during the summertime, restaurants are making 75% of their revenues from people dining in. According to one of the data dumps that I saw, that means even when they were operating at 50% max, they were still getting most of their money from people coming in. People don't naturally just shift their habits and say okay, everything that I spent before in a store, at a restaurant, at a cultural event, I'm now going to spend that same amount at home. We do a little bit, but not as much so. There's got to be some merging of these two lifestyles going forward in terms of business innovation.
There's only thing I really wanted to bring up here because I think this is an important thing to remember about why we talk so much about the need to bring people back downtown and bring people back into some of these jobs. The number I have on my screen that the CU Leeds School of Business provided to me that I think is shocking is unemployment by wage group. And what it shows is that never did the unemployment for high income earners (those above $75,000) dip below about a 4% drop during this last recession. For the middle income earners (those between $50,000-75,000), it dipped to about a 7.5% percent drop in the worst of things in April, but it's now back around 5%. Those numbers are still down, and the state’s still at about a 6.2% unemployment rate, so they're doing just a little bit better.
But for low-income earners (those who make $50,000 a year or less), there was a 30% drop in employment in April and even now, they are still about 11% less employed than they were this time a year ago. These are the jobs we've got to figure out how to get back. You can't take a retail store clerk and tell them to work from home. And if you can't do that, how do we talk about retraining people? I mean, maybe moving away from some of these service jobs that were so in person before the pandemic may not be as in person going forward. What can we do to help people find the new skills that we need in more of a spaced out world to be able to get back to earning?
KU: And there are disproportionate impacts, this widening gap. We're also seeing gender based gaps, racial gaps, these very disproportionate impacts of those who've lost jobs and those who've been impacted by COVID-19 themselves.
DJ: In our survey last fall of more than 300 organizations, we saw that about a third of the jobs had been furloughed or laid off. That was major. We'll be doing another survey coming up soon. Anecdotally, there's an uptick on our job board of hiring. Yesterday, I looked and there were 50 jobs in the art sector, from the zoo to the museum to lots of organizations. So that's a positive sign thinking about recovery for summer.
What worries me again is back to the gig economy, where we have so many lower paid wage earners in the creative sector that are also waiters and bartenders that we’ve got to figure out, making sure that those people can get back to work. And then just the gender gap and we've seen so many women that have gone home, that are taking care of families, and the time it's going to take for them to get back into the workforce.
There's also a concern that we haven't seen much, which is great, of people leaving the creative sector. They've lost their job, they say, I can't do this anymore, I'm getting out. And we've seen a few examples of people leaving the state to do retraining or real estate and other industries, but that has not been significant, which I'm really happy about.
One thing that's really helped organizations was PPP and the funding from the community. I've got to say that funders really stepped up for relief funding. And one really silver lining in all this is that SCFD, thanks to the residents, brought in $64 million, and distributed over $63 million, got that out to all 300 organizations. So the health of this economy, as dire as it was, we still were able to put $63 million into stabilizing some of these organizations. So there's a long way of saying, you have a long ways to go and we need to get the jobs back and we need to get things open.
ES: I think the stimulus funding is fascinating, because if you look at even last April, while unemployment went through the floor, personal income actually went up because we had some stimulus. But what we've seen is a very interesting breakdown and I apologize, I don't remember the exact number right now, but I think it was somewhere around $46,000 a year. If you made more than that, you saved your stimulus check. If you made less than that, you spent your stimulus check. The idea of the stimulus is clearly to get money into people's hands so they can spend it right now to help those people out
I mean, I think there needs to be more of an emphasis that what the government is giving should be spent right now. That's the thing that folks are going to need to get through. And the truth is, the next six months are going to be very important, even as restaurants and cultural institutions and others reopen. If people are reluctant to go out and spend, whether that be because of coronavirus, fears of economic downturns, or just changes in habit, we're gonna see a lot more businesses closing now that PPP and some of these loan programs are going away.
The idea of urging people to spend now is something that kind of runs counter to many previous exhortations, especially to lower income folks saying, please save your money, have that rainy day cushion. Now, I think the government needs to get out and say look, if we're giving you money, go out and spend it, because that's what's going to be key to these businesses that have been hanging on, hoping for a huge summer. And if they don't get that huge summer, I think by the fall, we could see another mass round of closings if we don't see a huge economic boom.
DJ: I think summer is key to seeing success for all sorts of industries, whether it's for outdoor festivals or performances, but also restaurants, shopping, retail, getting out. I agree with you that we're going to really have to watch and see what happens by the fall. I'm always encouraging culturals to not just think of stimulus money but to think of loan programs as a great way to build credit. Normally, nonprofits are always thinking about grants that don't need to be paid back, but if it's a good way to just build a credit, that's just a small piece of thinking about the economic health of a nonprofit.
KU: Is there a particular metric you’re watching closely? Like, you’ll be really excited when x happens, or if I see y, I'm going to get really worried.
ES: I was about to say tax revenues, but I don't think that's a good one, because tax revenues doesn't tell us whether or not we are leaving our home to purchase things and I think as we've mentioned, we need to leave our home to purchase things. I think those studies that are done that show personal movement are going to be key. If you remember, you know, back in March and April last year during the shutdown orders, you know, we saw 70% less personal movement from people tracking cell phones to see where they're out about. People need to get out and about this summer. People need to be able to return to near pre-pandemic levels of travel, whether that be to other parts of the state or even just within our communities. I think if we don't see that, I think that will show a hesitancy to return to a pre pandemic normal, and in that case, a need to really accelerate our thinking about what a more dispersed society is going to mean economically for jobs. I like to think of small businesses not as jobs, but as people's dreams. So if we don't see people moving about, we're going to need to do some hard looking and say how do we move forward to the future?
DJ: I totally agree. But for me, it's all predicated on public health orders, and not opening too soon because it all trickles down from there. In terms of what sectors are going to be able to do what in terms of opening up, rebuilding the trust and the consumer confidence...that's kind of the big one looming out there for me.
KU: Ed, this idea of potentially tracking people's movement and behavior -- is there good data for people who are interested in following that?
ES: That’s not an easily accessible point of data, those are usually studies that are done by companies that pass them along to governments or to other companies to understand how people are moving about, I think it'll be interesting to watch some transportation factors. Roads, for example, are back to about 90% of their pre pandemic levels. Transit is still at 40% of its pre pandemic levels, at least for RTD. I think, you know, once people feel the confidence to get back on to shared vehicles and into transit, that will also be a sign that we're going back. And if that doesn't happen, we also need to reimagine our transportation system, as well as our economic society if people decide, I'm not going back to the days of sharing vehicles and moving about groups.
KU: Any closing reflections?
DJ: I can say for me, it does go back to the ability for creative people, organizations, artists, painters, musicians, to see the world with a different lens, to deal with issues like the death of George Floyd, or the environment or the pandemic, to be able to see the world differently and to share that with the public. I know it sounds sort of basic, but that's what creative sector does, and it is about self interest. And thinking of the future.
ES: I'd say for businesses, it's follow the lead of your customers. I think too often, we get into this debate about capacity or to mask or not to mask. I think over the next couple months, we're gonna see how comfortable people are. I think you always default to the safest possible atmosphere if you're a business. If your employees don't feel comfortable coming back, find a way to have them scattered. If your customers want you to be masked and limited, go with that. But also follow what people are doing and see what they're looking for. I mean, maybe some of these cleaning procedures that we've seen in businesses shouldn't go away. That's not a pandemic time thing. Maybe we should be a little safer society and just see where the general public feels like it wants to go from here. I think that will help us not just trust more in institutions, but start to trust in each other a little bit more, too.
The Institute for Science & Policy is committed to publishing diverse perspectives in order to advance civil discourse and productive dialogue. Views expressed by contributors do not necessarily reflect those of the Institute, the Denver Museum of Nature & Science, or its affiliates.