Businesses plan amid turbulent economy

March 25, 2020

While politicians disagree on how to address the economic disruption caused by the COVID-19 pandemic, there is universal agreement that there will be disruption on a massive scale.

When Harris County Judge Lina Hidalgo introduced the local version of a stay-at-home order, she named the effort “Stay Home, Work Safe,” a name reflecting the challenge of balancing the protection of public health and the protection of the economic infrastructure that supports the region.

On the day-to-day level she focused on the importance of the businesses that support individuals and families, from grocery stores and restaurants to veterinarians and repair services.

For the broader economy, the declaration specifically mentioned the need to keep the Port of Houston and the Johnson Space Center operating, as well as the energy, chemical and logistics sectors. Also prominently mentioned was the Texas Medical Center, which, in addition to being a treatment center for ill people, is an economic pillar and a nationally critical research center.

Closer to home, the jobs where thousands of Baytonians work every day are critical to some of the largest companies in the nation and even the world.

The Baytown West Chambers County Economic Development Foundation, usually known for its efforts to bring new business to Baytown, is now working to help local business and government leaders navigate uncertain times, minimize current disruption and prepare for recovery.

“Business continues,” said B.J. Simon, associate executive director of the foundation. “People are planning because they know that there will be technological, sociological and psychological interventions that at some point are going to stabilize this.”

In addition to the immediate unemployment and reduced income caused by small businesses closing, dropping oil prices will hurt the energy sector.

The announcement this week of upcoming layoffs at the IPSCO facility in Chambers County is the only such local announcement Simon is aware of, he said, but the energy industry was already suffering from the conflict between Russia and Saudi Arabia even before the pandemic.

“Nobody could have imagined the impact of a novel coronavirus,” he said. “It’s a squeeze.”

The City of Baytown, he said, is looking at the effect the slowdown will have on sales tax revenues, a major source of income to support city services.

He said the stimulus package expected from the federal government is likely to have some spiking effect on the economy.

Also on a hopeful note is the surge in online sales.

“Because of this new change in the interaction in brick-and-mortar stores you’ve got Walmart and Amazon hiring hundreds of thousands of people, so they’re going to try to address demand by getting people filling orders and also delivering them. We may see some of that here,” he said.

Most of the industries that are dominant in the area are covered under the federal list of critical infrastructure sectors, which means that many workers still have jobs.

“I spent most of my day yesterday addressing questions and answers related to that,” he said, “related to the Chambers County shelter-in place announcement and the Harris County shelter-in-place announcement and the Galveston County [announcement].

“These employees are not all here so they have to navigate through all those areas in a way that meets the standards set forth by these counties.

“But the intent, I think, for the people that I fielded questions from yesterday is to maintain operations as fully as they can. That’s the expectation.”

“Most of the folks who can work from home are working from home,” Simon added