NC tech executives see economic rebound starting in August or later

RALEIGH – North Carolina technology company executives don’t see an economic recovering from the COVID-19 pandemic really starting until August or later, according to a new survey from the North Carolina Technology Association. That’s a more pessimistic view from a poll in March.

While 73 percent seeing an August or later “measurable improvement” in the economy, only 26 percent see an early summer revival. That’s a decline of five percentage points.

Executives were surveyed April 30.

They are not alone in their belief a quick recovery is not coming. NCSU economist Dr. Mike Walden noted in his latest monthly review of the North Carolina economy that “Unfortunately, we have much more virus-induced damage to come.”

A more pessimistic attitude also grew prevelant in predicting what kind of recovery there would be.

“A large portion of those predicting a U-shaped recovery [gradually bottoming out then recovering] in past polls shifted to the W-shaped option [recovery, downturn, stronger recovery] in this new poll: 56% chose U-shaped, 29% chose W-shaped, 11% chose L-shaped [decline, stays there for sustained period], and just 4% said V-shaped [quick “pivot” to rapid growth] ,” NC TECH explained.

“This reflects a more pessimistic outlook that previous polling suggested.”

The options were added for the “W” and “L” options in this poll.

However, many tech firms continue to hire and also say demand for their products and servicces has grown since the pandemic began.

Nearly 28,000 jobs were available in March, according to NC TECH’s monthly Tech Talent Trends Alert.

NC TECH graphic

“The tech sector appears to be faring better than many other parts of the economy, with 60% of those polled reporting that demand for their offerings has increased or remained neutral, with 40% indicating a reduction in business,” the business advocacy group explained. “There was little change on this question from previous polling.”

Also, even as nearly 1 million North Carolinians have filed for unemployment, some 40 percent of the tech executives said they were still hiring.

Only 11 percent were exploring or starting furloughs, layoffs and other cuts such as in compensation. That number is “trending slightly up,” NC TECH said.

“Technology companies are, by and large, more adaptive to high levels of change. They view an intense VUCA (Volatility, Uncertainty, Complexity and Ambiguity) world as a challenge, filled with opportunities,” said Dennis Stearns of Stearns Financial Group, which is the sponsor of the poll. He said tech leaders’ mindet differs from non-tech execs.

“Unfortunately, many non-tech companies are still dealing with multiple pandemic threats, including in some cases having to radically reinvent their business,” Stearns added.