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Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times.

Episode 47: Jan. 11, 2021

George O’Brien talks with Andy Yee, president of the Bean Restaurant Group

Andy Yee

BusinessWest Editor George O’Brien talks with Andy Yee, president of the Bean Restaurant Group. The two discuss the ongoing plight of area restaurants as they battle the pandemic, ever-tighter restrictions on their operations, and the onset of winter. They also discuss the various forms of relief restaurants are receiving and whether they will be enough to help them withstand the many challenges they are facing. It’s must listening, so join us on BusinessTalk, a podcast presented by BusinessWest in partnership with Living Local.

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Cover Story Economic Outlook

Question Marks Dominate the Horizon

Entering a new year, there are always question marks about the economy and speculation about the factors that will determine just what kind of year it will be. For 2021, there are far more questions — and fewer definitive answers — and the speculation comes in layers. A great many of them. Much of this speculation involves the pandemic and, with vaccines becoming available to ever-greater numbers of people, whether we are truly seeing light at the end of the tunnel, the beginning of the end (of the pandemic), or any of those other phrases now being used so frequently. But there are other things to speculate about as well, including what the landscape will look like when and if things to return to normal, or a ‘new normal,’ another phrase one hears a lot these days. Will the jobs that have been lost come back? Will people pick up old habits regarding going to restaurants, the movies, the doctor’s office, or sporting events? Will businesses return to their offices? And will their offices be the same size and in the same community? Another phrase you’re hearing — and will read in the stories that follow — is ‘pent-up demand.’ Many businesses, from eateries to colleges and universities to medical practices, are counting on it, but will it actually materialize? These are all good questions, and for some answers, we turned to a panel of experts for a roundtable discussion, without the roundtable. Collectively, they address the question on everyone’s minds: what is the outlook for 2021?

The Big Picture >>

Economist says pent-up demand will be the key to any recovery

Education >>

School presidents project multi-year emergence from pandemic

Banking >>

This CEO says some habits are changing, but are they permanent?

Accounting >>

This CPA is advising clients to keep the seat belt buckled

Healthcare >>

A Q&A with Baystate Health President and CEO Dr. Mark Keroack

Fitness >>

Business owners grapple with an industry battered by restrictions

Restaurants >>

Owner of large, regional group says it’s survival of the fittest

Technology >>

IT expert says it’s time for businesses to move from survival to growth

Retail >>

Big Y’s Charlie D’Amour reflects on 2020 — and the year to come

Opinion

Editorial

The calendar no longer says 2020.

And that’s a really good thing. Over the past 10 months or so, those four numbers became synonymous with pandemic, challenge, uncertainty, and more challenge. Turning the calendar over helps psychologically, but it doesn’t change the equation. Not yet, anyway.

In fact, as the experts interviewed for our Economic Outlook section indicated, while there is indeed a light at the end of the tunnel, there is still quite a bit of tunnel to get through. If this is the beginning of the end (of the pandemic), the end is still a ways off.

And, in some ways, there’s a good chance things will actually get worse before they get better, because, as some experts noted, the relief that many companies received through stimulus initiatives will not be there, or there to the same extent, like they were in 2020. So many businesses will be facing a reality check, and a scary one at that.

But if 2021 looks daunting in many respects, we can look back at 2020, not for painful memories, or only painful memories, but also for inspiration.

Indeed, as we’ve written on several occasions, the best thing about 2020, from our respective, was the manner in which the business community responded to a crisis truly without precedent. Going back to the middle of last March, we wrote about how business owners in this region had been through a lot over the past few decades — recessions, including a ‘great’ one; a tornado; the sudden quiet after 9/11; Springfield’s fiscal meltdown; and so much more. We wrote that this pandemic would be unlike any of those and would test the mettle of this region in ways we could not have imagined.

We were right about that, but we were also right when we said this region was up for the fight. It was, and it is, and a look back at 2020 proves this.

Yes, some businesses have been lost, mostly in the retail and hospitality sectors, and the losses have not been insignificant. Meanwhile, a number of mainstay businesses have been battered and bloodied — MGM Springfield, the Basketball Hall of Fame, the Springfield Symphony, the Thunderbirds, Union Station, UMass Amherst and all the colleges and universities, every restaurant and performance venue in the region … the list goes on.

But they are still standing, and, in the meantime, a large army of small businesses have responded with imagination, perseverance, and the entrepreneurial spirit that has defined the region for more than 250 years.

We’re told many of these stories over the past nine months, and they have been inspirational. Businesses that found themselves struggling, through no fault of their own, discovered ways to pivot, find new revenue streams, and, in some rare cases, actually expand and grow their businesses.

If there was any bright spot to 2020 — and there were not many — watching this collective display of courage and determination was it.

And now that the calendar has turned to 2021, nothing has really changed. The operating environment is as challenging as ever, and even moreso for most hospitality businesses, now that winter has set in.

The next few months may be the most difficult yet, but we are confident that those same qualities that helped businesses ride out 2020 will enable them to continue the ride — until the day when ‘normal’ returns and the predicted pent-up demand will provide a much-needed lift to ventures across all sectors.

As the new year begins, the light at the end of the tunnel is still a ways off. But at least we can see it.

Opinion

Opinion

By Brooke Thomson

Associated Industries of Massachusetts (AIM) has worked tirelessly with elected officials on both the state and federal levels to moderate a potentially disastrous 60% increase in unemployment insurance rates next year and to keep the Unemployment Insurance Trust Fund on sound financial footing.

Last month, Gov. Charlie Baker took a major step toward addressing that issue by filing timely legislation to ensure a two-year schedule freeze and provide the ability to bond the remaining trust-fund deficit and allow it to be rebuilt over time.

Meanwhile, AIM continues to support efforts by the Massachusetts Congressional delegation to persuade Congress to provide additional resources for the state’s Unemployment Insurance Trust Fund. The $900 billion economic stimulus bill recently approved in the U.S. Congress does not provide money for state UI systems, though it does revive the Paycheck Protection Program with $284 billion to cover a second round of PPP grants to especially hard-hit businesses.

Massachusetts businesses now need elected officials to stabilize the state’s unemployment-insurance system by freezing the statutory rate and allowing Massachusetts to authorize bonding.

A day before Baker filed his rate-freeze bill, AIM provided a statement to the entire Massachusetts Legislature calling for a freeze on employer UI tax-rate schedules to shield Massachusetts employers from the upcoming rate spike, which is tied by statute to the overall condition of state UI Trust Fund.

Given the unforeseen economic shutdowns brought on by the COVID-19 pandemic beginning in March, the Massachusetts Department of Unemployment Assistance projects that the fund, primarily financed by direct and reimbursing employer contributions, will be in the red by $5 billion at the end of 2022 and remain insolvent by about $3 billion as far out as 2024.

These initial numbers, left unchecked, would trigger an increase from the current 2020 employer tax rate of Schedule E, or $539 per employee, to Schedule G, about $866 per employee, reflecting an almost 60% increase.

Baker’s bill would freeze the employer tax rate at Schedule E for the next two years, slowing annual employer contribution growth to $635 in 2021 and $665 in 2022.

AIM thanks Gov. Baker for filing this legislation, and we appreciate the speedy action that the House and Senate have taken throughout this pandemic with legislation to stabilize the unemployment-insurance system for employers and employees.

We urge the House and Senate to take urgent action on this proposed legislation to freeze rates and fund the system through bonding, which will ensure that all claims are paid to individuals, that the trust fund is stabilized with a low-interest loan, and the Commonwealth is able to avoid a statutorily triggered unemployment-insurance tax-rate hike in first months of 2021.

 

Brooke Thomson is executive vice president for Government Affairs at Associated Industries of Massachusetts.

Giving Guide Special Coverage

Regional Philanthropic Opportunities

While philanthropy is a year-round activity, this is a time when many of us think about those who are most in need, and how, in general, they can help make Western Mass. a better community for all who call this region home.

To help individuals, groups, and businesses make effective decisions when it comes to philanthropy, BusinessWest and the Healthcare News present the annual Giving Guide, which is especially relevant during this time of a global pandemic, when so many people are in need, and when so many of the nonprofits that work to meet those needs are struggling.

Open the PDF flipbook to view profiles of several area nonprofit organizations, a sampling of the thousands of agencies that provide needed services. These profiles are intended to educate readers about what these groups are doing, and also to inspire them to provide the critical support (which comes in many different forms) that these organizations and so many others desperately need.

Indeed, these profiles list not only giving opportunities — everything from online donations to corporate sponsorships — but also volunteer opportunities. And it is through volunteering, as much as with a cash donation, that individuals can help a nonprofit carry out its important mission within our community.

BusinessWest and HCN launched the Giving Guide in 2011 to essentially harness this region’s incredibly strong track record of philanthropy and support the organizations dedicated to helping those in need. The publication is designed to inform, but also to encourage individuals and organizations to find new and imaginative ways to give back. We are confident that it will succeed with both of these assignments.

George O’Brien, Editor and Associate Publisher

John Gormally, Publisher

Kate Campiti, Sales Manager and Associate Publisher

 


 

 

The Giving Guide is Presented by:

 

 

 

 


 

Construction Special Coverage

Constructing a Picture

In its recently released 2021 Dodge Construction Outlook, Dodge Data & Analytics predicts that total U.S. construction starts will increase 4% in 2021, to $771 billion.

“The COVID-19 pandemic and recession has had a profound impact on the U.S. economy, leading to a deep dropoff in construction starts in the first half of 2020,” said Richard Branch, chief economist for Dodge Data & Analytics. “While the recovery is underway, the road to full recovery will be long and fraught with potential potholes. After losing an estimated 14% in 2020 to $738 billion, total construction starts will regain just 4% in 2021.”

Furthermore, he added, “uncertainty surrounding the next wave of COVID-19 infections in the fall and winter and delayed fiscal stimulus will lead to a slow and jagged recovery in 2021. Business and consumer confidence will improve over the year as further stimulus comes in early 2021 and a vaccine is approved and becomes more widely distributed, but construction markets have been deeply scarred and will take considerable time to fully recover.”

He noted that the dollar value of starts for residential buildings is expected to increase 5% in 2021, non-residential buildings will gain 3%, and non-building construction will improve 7%. “Only the residential sector, however, will exceed its 2019 level of starts thanks to historically low mortgage rates that boost single-family housing.”

The pattern of construction starts for more specific segments is as follows:

• The dollar value of single-family housing starts will be up 7% in 2021, and the number of units will grow 6% to 928,000. Historically low mortgage rates and a preference for less-dense living during the pandemic are clearly overpowering short-term labor-market and economic concerns.

• Multi-family construction, however, will pay the price for the single-family gain. The large overhang of high-end construction in large metro areas combined with declining rents will lead to a further pullback in 2021. Dollar value will drop 1%, while the number of units started falls 2% to 484,000.

• The dollar value of commercial-building starts will increase 5% in 2021. Warehouse construction will be the clear winner as e-commerce giants continue to build out their logistics infrastructure. Office starts will also increase due to rising demand for data centers (included in the office category), as well as renovations to existing space. Retail and hotel activity will languish.

• In 2021, institutional construction starts will increase by a tepid 1% as growing state and local budget deficits impact public-building construction. Education construction is expected to see further declines in 2021, while healthcare starts are predicted to rise as hospitals seek to improve in-patient bed counts.

• The dollar value of manufacturing plant construction will remain flat in 2021. Declining petrochemical construction and weak domestic and global activity will dampen starts, while a small handful of expected project groundbreakings will level out the year.

• Public-works construction starts will see little improvement as 2021 begins due to continued uncertainty surrounding additional federal aid for state and local areas. Additionally, the unfinished appropriations process for fiscal year 2021, which began Oct. 1, raises doubt about the sector’s ability to post a strong gain in 2021. Public-works construction starts will be flat over the year.

• Electric utilities and gas plants will gain 35% in 2021, led by expected groundbreakings for several large natural-gas export facilities and an increasing number of wind farms.

 

Daily News

SPRINGFIELD Bulkley Richardson announced that 14 lawyers from the firm were recently selected by their peers for inclusion in The Best Lawyers in America© 2021. Bulkley Richardson had more honorees than any other law firm in Springfield. These 14 lawyers were recognized in 20 unique areas of practice.

  • Peter Barry — Construction Law
  • Michael Burke – Medical Malpractice Law (defendants), Personal Injury Litigation (defendants)
  • Mark Cress — Banking and Finance Law, Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law, Corporate Law
  • Francis Dibble, Jr. — Bet-the-Company Litigation, Commercial Litigation, Criminal Defense (White-Collar), Litigation (Antitrust), Litigation (Labor and Employment), Litigation (Securities)
  • Daniel Finnegan – Administrative / Regulatory Law, Litigation (Construction)
  • Robert Gelinas — Personal Injury Litigation (defendants)
  • Kevin Maynard — Commercial Litigation, Litigation (Banking and Finance), Litigation (Construction)
  • David Parke — Corporate Law
  • Melinda Phelps — Medical Malpractice Law (defendants), Personal Injury Litigation (defendants)
  • Jeff Poindexter – Commercial Litigation
  • John Pucci – Bet-the-Company Litigation, Criminal Defense (General Practice), Criminal Defense (White-Collar)
  • Elizabeth Sillin – Nonprofit / Charities Law, Trusts and Estates
  • Ronald Weiss – Corporate Law, Mergers and Acquisitions Law, Tax Law