California Economy Affected by COVID; on the Upswing
The Claim
COVID-19 rules did not hurt California’s economy.
News posted on
Emerging story
On June 13, 2021, The Mercury News ran an article that claimed stricter COVID-19 rules did not hurt California’s economy. Many on social media called it fake news.
Misbar’s Analysis
Misbar has discovered that the article and headline in question was based on a report from the UCLA Anderson School of Management and then reported on in an article published by the Mercury News. According to the article, “Among large states, those with strict pandemic rules performed as well and in some cases better than their laissez-faire counterparts. California’s GDP shrunk less than that of Texas and Florida in 2020” which seems to be the basis for the headline.
The GDP is an acronym for Gross Domestic Product, which measures the value of final goods and services produced in a region in a given period of time (California in 2020 for example). The GDP is composed of goods and services produced for sale, so not only items that would be made in a factory, but also things like educational and technology services. Because California is home to a multitude of high tech industries, many which remained relatively untouched by the Coronavirus pandemic, a better comparison of economic health post-pandemic would be to look at multiple factors beyond the GDP.
- California
GDP 2019 to 2020: -2.8 (rank against Texas and Florida: 1)
Unemployment rate in April 2021: 8.3% (rank: 3)
Poverty rate: 13.0% (rank 1)
Closed businesses in 2020: 35.9% (rank 3)
- Texas
GDP 2019 to 2020: -3.5
Unemployment rate in April 2021: 6.7%
Poverty rate: 13.7%
Closed businesses in 2020: 32.6%
- Florida
GDP 2019 to 2020: -2.9
Unemployment rate in April 2021: 4.8%
Poverty rate: 13.1%
Closed businesses in 2020: 32.2%
COVID-19 was devastating to the U.S. economy using multiple measures. When compared with other large states with less stringent COVID-19 restrictions, California did not come out on top on all measures.
