What happened with that recession economists predicted?
Remember how a few months ago, many economists were certain that a recession was coming in 2023? Well, here it is August, and a recession still hasn't shown up. That's got many people, including Tony Mecia of the Charlotte Ledger Business Newsletter, asking what happened. He joins us now for our segment BizWorthy.
Marshall Terry: Tony, The Ledger dove into the case of the missing recession this week and found there are multiple reasons it hasn't happened. So what are they?
Tony Mecia: Marshall, there are a few things. We had Hannah Lang, who's a very talented economics writer, look into this. (She) called several North Carolina economists that she had talked to over the last few years, and said well, ‘Where is this recession that you've been speaking of?’ and they gave her a few explanations.
They said, you know, one — the labor market has really stayed more resilient. Typically, when the Fed raises interest rates, as it has, that cools the economy down. Companies don't hire as many people, but hiring has really stayed strong, certainly in North Carolina and around the country. That was one.
And then the other thing that they mentioned to her was the lingering effect of COVID stimulus money. You know, we had a huge outflow of money from Washington to prop up businesses and individuals, and really that is still going strong. Although that money has started to dwindle coming out of Washington, we're still seeing the effects of that. You still see a lot of consumer spending. If you've been on an airplane, or out to eat, or been to a hotel — (the) travel and hospitality sector is really going like gangbusters now, really unexpected to a lot of the economists.
I was at a meeting of the Charlotte Regional Visitors Authority, and some of them were saying they don't see really any signs of a recession. Hotel bookings are still strong in Charlotte. So, as one of the economists told the reporter for The Ledger: ‘Really, the economy is totally off-script at this point.’
Terry: Well, how do economists feel now about the economy moving forward? And should we trust them? I mean, since it looks like they whiffed on the recession prediction, at least so far.
Mecia: In their defense, it is hard to predict the future a lot of times, right? I mean, they're looking at past historical patterns and things like that, so they're sort of our best hope maybe for predicting the future. They tend to say they do believe a recession is still coming, maybe toward the end of this year (or the) beginning of 2024. But as of right now, things are not looking as though they're going to be as severe as they had previously forecast.
Terry: All right. Well, I want to move on to another topic now, and I would like to repeat a question that The Ledger put forth this week. On the eve of its demolition, is the Uptown Cabaret building historic? Now, I didn't realize that was a question folks were asking, Tony.
Mecia: Well, a lot of people probably are not asking that, Marshall. But Jeremy Markovich — he writes a newsletter called North Carolina Rabbit Hole that looks at sort of odd and quirky things in North Carolina — actually looked into it. You know, he saw that the Uptown Cabaret is about to be demolished to make way for a couple of towers there on Morehead Street, started asking some questions, and he found that actually, to his surprise — and to the surprise, probably of a lot of people — the Uptown Cabaret building on Morehead Street was built around 1930. It was an antique shop for many decades. It was an office building into the 1980s. And then it became the strip club in 1995. Now, he also talked to historian Tom Hanchett and a planning commissioner here locally who said just because the building is 90 years old doesn't mean that it is historical or qualifies for historic designation. So I don't know that anybody is really protesting too loudly that Charlotte is once again demolishing its history.
Terry: All right. Well over to another building now, Quail Hollow Club. You report a tournament is coming to the club next month, but it's not golf. So what's going on?
Mecia: Yeah, Quail Hollow Club, most people know it as the home of the pro golf tournament The Wells Fargo Championship. But next month, there's actually going to be a different kind of tournament, a pickleball tournament. A local charity called InReach, which supports people with intellectual and developmental disabilities, is having a pickleball tournament there called InReach Smash. They hope to raise $50,000. Quail Hollow has four pickleball courts that they've made available to this local charity. And the head of InReach tells us that people just love pickleball.
Terry: Finally, you report Discovery Place Nature museum is closing soon. Now this has been in the works for a while. So what's finally going to happen there?
Mecia: Marshall, you might recall a few years ago in 2019-2020, there was a lot of debate among neighbors near Freedom Park, where Discovery Place Nature is, about the expansion and renovation of the museum. The museum has been there since 1947. It's getting a little bit dated. Discovery Place wants to update it. They finally worked things out with the neighbors. The construction has been pushed back a little bit. They were hoping to get a little bit sooner. But, the latest is the nature museum is expected to close by the end of this year. Construction starts beginning of 2024, and they're just going to make it into a more modern version of what it has now. You know, wildlife and plant exhibits, school children coming to visit, and make it a little more up to date.
Support for WFAE's BizWorthy comes from UNC Charlotte's Belk College of Business, Sharon View Federal Credit Union and our listeners.