The Reopening: Anxiety, Excitement, Uncertainty

August 1, 2021

Ray Hair  -  AFM International President

It’s been 17 months since the COVID pandemic brought live entertainment to a screeching halt around the world. Emergency government regulations, mask mandates, and social distancing regimens are being relaxed in the US, but conditions are still in flux. Canada is only now beginning to ease lockdown restrictions. One of the longest indoor-dining bans in the world was imposed in Toronto—lasting over a year.

Enough data is in to suggest that America is in its early stages of recovery from the pandemic. Canada is in its very early stages. The live entertainment industry is beginning to emerge from lockdown and from the unprecedented job loss suffered by professional musicians.

The effects are still weighing on us. The struggle to return to some semblance of where we were before will continue for years to come. Still, nearly a year and a half into the pandemic, despite the lifting of COVID restrictions across the US, the World Health Organization continues to recommend wearing masks indoors, and new variants are spreading.

There is no playbook for ending the pandemic and eliminating all risk in the reopening of performance venues, so that we can reconnect with live audiences, and just as importantly, with each other. There are no quick and easy solutions to the enormous problems the pandemic has created.

Going forward, you’ll see a worldwide effort to write that playbook in real time. The Federation is part of that effort, working with our colleagues from other arts and entertainment unions. We will also work hard to ease restrictions on cross-border immigration for our Canadian members. We are working with the entire US labor movement to lobby for progressive changes in labor laws. We will certainly need better labor law protection as pandemic-induced employer attitudes drive increased automation and job elimination.

The pandemic has left 7 million people unemployed, and lots of kinks in our economic system—like the appearance of a labor shortage where there shouldn’t be. We have unemployment and labor shortages at the same time. The economy is trying to restart after experiencing the deepest recession in generations. Parts of the economy are severely broken.

There are major shortages in semi-conductors that are idling auto manufacturing (down 17%). There are unbelievable difficulties in the parts supply chain. Tesla had over 10,000 cars on hold at its Fremont, California, plant that couldn’t be delivered to customers due to parts shortages.

There are supply crunches in raw materials. The explosion in demand for building materials, which is now beginning to ease, sent prices for lumber up 340% from a year ago and steel prices up 300%. The cost of packaging materials, like plastics and paper, have been driven up 50% since the start of the pandemic. Less retail, less wastepaper, together with more e-commerce, has tightened supply and increased demand for paper. Plastic material costs are at multi-year highs. Logistical problems include shipping container bottlenecks and a lack of shipping containers, creating an astronomical rise in freight costs.

There are three important points to make here:

• As the economy tries to restart, we face major shortages in everything—raw materials, parts and components, and labor shortages (at a time of high unemployment).
• Scarcities and supply line disruptions are preventing the economy from rebounding to its full potential, and will affect the speed at which the economy recovers.
• There is worry that high demand for scarce materials may result in an inflationary spike that could depress wages.

In response to the crisis, governments of the US, Canada, and around the world adopted monetary policies in phases. First, they have lowered interest rates to near zero to stabilize financial markets and ensure the flow of credit. Second, fiscal measures in the form of supplemental unemployment benefits and business subsidies entailed the printing of trillions of dollars of new money, distributed to sustain the economy against the background of governmental quarantines and social distancing measures. Third, policies were implemented to develop and distribute vaccines.

Due to the enormous and unprecedented amounts of monetary stimulus pumped into the economy last year, financial markets recovered from the losses experienced in March and April 2020, launching an economic recovery that is booming, bouncing along, and struggling to gain equilibrium.

And with the acceleration of vaccine development and distribution, a way out of this health crisis looks more and more visible. The risk level has come down, and many folks are looking to get back out this summer and fall to kick it out. And there is a huge supply of stimulus money to help light that fire.

It looks like the public is evolving back to a degree of openness, but there is conflict in that. We have lots of folks who are still worried, whose behavior hasn’t shifted, and who haven’t changed their precautions since January. We are making progress, but there is still a lot of confusion.

You can feel the vibe that we are not out of the woods yet. And the regulations and health guidance change every day. As people process that, we see hesitation and inconsistent behavior. This will affect the consumption of live entertainment and subsequent employment.

I think we are confronting a lot of the same uncertainty we felt at the beginning of this crisis. We are experiencing the end. It will take longer than we think, probably be messy, and continue to produce worry. It will also be exciting, as we head back to work.

For more than a year, the public has been starved for live entertainment and live music. As in other industries, the pandemic effect has created a shortage. And like other parts of the economy, there exists pent up demand. There is a thirst to hear and be entertained by great live musical performances. We are about to quench that thirst.

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