The Phoenix Economy

The COVID-19 recession was part of a “great acceleration” of economic timetables.

The economic downturn that hit the US economy in mid-March of 2020 was so dramatic that it clearly qualified as a recession. But economists traditionally define a recession as back-to-back quarters of declining economic output; the COVID-19 recession lasted just two months. The speed of the downturn and recovery shortened timelines of all sorts. For instance, the US Bureau of Labor Statistics’ jobs numbers for March 2020 could scarcely hope to capture the reality that the labor market was strong for the first half of the month but then fell off a cliff in the second half.

Zoom and Slack, two technology companies that went public in 2019, became household words almost as soon as the pandemic started. But just as quickly as Zoom shares benefited from the COVID-19 boom, they fell back down to Earth. While Zoom was hot for a few months, it didn’t take long for Microsoft to respond. Perhaps if Zoom had grown more gradually and quietly, Microsoft wouldn’t have noticed the upstart. But Microsoft promptly responded by upgrading Teams. From there, it didn’t take long ...