The big will get bigger as mom-and-pops perish and shopping goes virtual.
In the short term, our cities will become more boring. In the long term, they might just become interesting again.
Many Americans are pondering: Who will emerge intact from the pandemic purgatory, and who will not?
We are entering a new evolutionary stage of retail. Big companies will get bigger, many mom-and-pop dreams will burst, chains will change the character of many neighborhoods, e-commerce will increase, and restaurants will undergo a transformation unlike anything the industry has experienced since Prohibition.
This is a dire forecast with a glimmer of hope. If cities become less desirable, they will also become cheaper to live in, attracting more interesting people, ideas, and companies. This may be the cyclical legacy of the coronavirus: suffering, tragedy, and then rebirth creating a more resilient American city for the 21st century.
The U.S. Commerce Department reported that retail spending in March collapsed by the largest number on record. Travel spending—including on airlines, hotels, and cruises—is down more than 100 percent, if you include refunds.
Department stores and clothing stores are facing an extinction-level event after having experienced years of decline.
Pockets strength include grocery stores and liquor stores, which in March had their best month of growth on record. Home-improvement spending is up as well.
American retailers had a long way to fall as we moved toward online shopping. In 2017, and again in 2019, physical-store closures reached an all-time high.
The year 2020 may bring the death of the department store, marking the end of that 200-year-old retail innovation after decades of decline.
The most resilient companies include blue-chip retailers like Amazon, Walmart, Costco, and Home Depot, all of whose stock prices are at or near record highs.
One survey of several thousand small businesses found that just 30 percent of them expect to survive a lockdown that lasts four months.
The growth of online shopping and big business will be hard to ignore for many city residents. It will make cities feel more desolate for the next year or longer.
Restaurant spending has fallen by about 60 percent, with the sharpest declines in fine-dining, lunch, and late-night food.
Online shopping has gone from a regular habit to a crucial part of America’s infrastructure. One-third of Americans bought groceries online in the past month, and tens of millions of them did it for the first time.
The COVID-19 pandemic will leave two legacies. The virus will reduce to rubble many thousands of cherished local stores. Chains will surge, restaurants will feel desolate, and the life force of cities will be ruinously arrested by the disease.
But the near death of the American city will also be its rebirth. From the ashes, something new will grow, and something better, too, if we build it right.