As the COVID-19 pandemic moves across the globe, Dow Inc. CEO Jim Fitterling looks to what's happening in China for clues to what is coming in the United States — and when the economy could start picking up again.
He said things could begin returning to normal in the second half of the year, but added that broad U.S. economic growth might not happen until 2021.
Another question: What will be the outlook for far-flung global supply chains when the crisis is over? Right now, economies around the world have effectively shut down, as governments urge people to stay inside and practice social isolation.
"We've seen good economic indicators coming out of China," Fitterling said in response to a question from Plastics News Editor Don Loepp on March 30, the first day of Antec 2020: The Virtual Edition. They sat in front of computers, communicating remotely. Fitterling was a keynote speaker for the virtual Antec, organized by the Society of Plastics Engineers.
"China really started into this in the middle to the end of January, around the Chinese New Year time, and obviously was slow to come back out of that," Fitterling said. Midland, Mich.-based Dow has operations around the world.
Fitterling said production power for Chinese industry is starting to come back after bottoming out at the peak of the crisis. He said the service sector remains relatively weak because people still aren't going out to movies or shopping.
"I think they will stay low for awhile. But you're starting to see traffic pick up in the biggest cities in China as a sign that people are getting back to work," Fitterling said. "And so I think what you can expect to see is typically, it takes two to three weeks in this containment phase, while the number of cases that get diagnosed ramps up. It takes another couple of weeks before you see the number of hospitalization cases kind of peak. And then, probably two to three weeks after that, until you see the number of mortality or death cases, start to peak out. So kind-of 45 to 60 days through this, is starting to come out of it."
Society then will begin returning to normal, as many people leave behind the all-virtual lifestyle. So what does Fitterling foresee for the United States, after work resumes?
"I would say the next phase after that will be hopefully some kind of a return to normal. And then the phase after that will probably be some kind of return to growth," he said.
"My sense is by mid-year, we're returning to work. By the third quarter, hopefully, or the fourth quarter we're starting to return to normal, but my guess is returning to growth is probably something that'll be more of a 2021 time frame."