This story originally appeared on SmartAsset.com.
Many economists have theorized about what the shape of the COVID-19 recession — in other words, the possibilities for recovery — will be. Some individuals are still holding out hope for a “V-shaped” recession in which the economy will rebound as quickly as it declined, which would in turn allow many to begin to repair the dents suffered to their financial reserves.
Given the current circumstances, however, the odds that such an optimistic forecast will become reality have decreased. As coronavirus infection rates spike throughout the country, local governments may decide to reimplement business shutdowns and stay-at-home orders.
One way to visualize the recession’s shape thus far is to examine consumer spending. Consumer spending accounts for roughly 68% of U.S. gross domestic product, and thus drastically impacts the length and severity of a recession. In this study, SmartAsset took a closer look at consumer spending in the U.S. during the COVID-19 pandemic.
Data for this report comes from tracktherecovery.org, published by Opportunity Insights. The data comes from private companies, such as credit card processors and payroll firms. Opportunity Insights collected data for 51 cities total, and we considered all of them.
For the purposes of anonymity and privacy, credit/debit card consumer spending data is not reported in terms of gross amounts, but rather as a percentage relative to average spending from Jan. 4, 2020, through Jan. 31, 2020. To find where consumer spending has recovered the most and least, we first ranked each city according to two metrics:
- June 2020 consumer spending. This is consumer spending as of June 30, 2020, relative to average consumer spending between Jan. 4, 2020, and Jan. 31, 2020.
- Percentage point recovery. This is the difference between the lowest point in consumer spending relative to January 2020 and June 2020 consumer spending.
We ranked each city in each metric. Giving an equal weighting to both metrics, we found each city’s average ranking. The city with the highest average ranking received a score of 100, ranking as the place where consumer spending has recovered the most. The city with the lowest average ranking received a score of 0, ranking as the place where consumer spending has recovered the least.