After the May 25th death of George Floyd in police custody, protests have erupted across the country. Multiple states and dozens of cities have had to take extensive measures, including imposing evening curfews and calling in the National Guard for assistance. States that were recovering from the coronavirus pandemic were suddenly forced back into weakened conditions.
Market experts have been watching the industry after the recent civil unrest to determine its potential impact on the stock market and overall U.S. economy. Jason Kulpa, net worth expert and experienced entrepreneur, shares how these recent protests may harm markets and the whole economy.
Protests Result in Mass Gatherings
People have convened to protest in cities across the country; the massive gatherings range from hundreds to thousands of people. Most cities have been slowly reopening in recent weeks as coronavirus numbers have been decreasing slightly. With mass gatherings taking place, experts are concerned that there may be an uptick in coronavirus cases and a second wave of the pandemic.
Images of protests throughout the country have shown a mix of individuals that are not adhering to safety protocols and those that are still wearing masks and adhering to social distancing guidelines. The concern is for those that are not wearing masks that are gathered in such small quarters. If a second wave occurs, it could worsen the conditions of the economy and market for businesses that have been scrambling trying to get back on their feet. Most industries have been waiting for weeks to get cleared to resume activity as usual, but this could further delay any rebound.
Civil Unrest Leads to Lack of Consumer Confidence
Consumer confidence numbers have certainly been on the decline over the last few months as investors have been hesitant to invest or make purchases. Market experts fear that protests and the civil unrest will only cause more uncertainty and leave consumers feeling uneasy. Any businesses damaged by riots may struggle to reopen. If businesses suffer a further delay of reopening, consumers may feel more and more concerned with supporting local businesses or investing their capital in uncertain times.
Further Damage to Local Government
Local governments across the United States have been strapped for cash due to extra expenditures resulting from the coronavirus pandemic. With some protests becoming violent, officials have had to allocate assets to help restore damaged government buildings and remove graffiti from many public areas. As federal aid and other funding diminish, governments may have to cut costs even more by imposing layoffs.
Additionally, individuals have lost trust and confidence in their local law enforcement and government officials. Loss of confidence will absolutely lead to a lack of funding for initiatives and defunding of certain departments. With a lack of funds, local economies may not have the support needed to rebound from crisis mode any time soon.
About Jason Kulpa
Jason Kulpa, net worthexpert and serial entrepreneur, is the Founder and CEO of UE.co, San Diego’s Fastest Growing Business multi-year award winner, and a Certified Great Place to Work multi-year winner. Mr. Kulpa is a San Diego’s two-time winner of the Most Admired CEO Award of the San Diego Business Journal and also a semi-finalist for the Ernst and Young Entrepreneur award. Under Mr. Kulpa’s leadership, in 2018, his teams volunteered at over 24 events and worked side-by-side to improve the San Diego community. They hosted a gala dinner benefiting individuals with autism, cheered on Special Olympic athletes as they broke their records on the track, and brought school supplies and cold-weather gear to students impacted by homelessness. Jason’s mission is to bring awareness, support, and inclusion for special needs causes.