Q&A

With: Cris deRitis, Deputy Chief Economist for Moody’s Analytics

In December 2019, for [DWM]’s annual outlook, deRitis said he expected a “middle of the road, steady as she goes” performance out of the U.S. economy in 2020. He also spoke of a newfound vigilance in lending practices following the last recession, which he felt provided some protection from another crash in housing. With the COVID-19 crisis, those predictions have since fallen by the wayside. We caught up with deRitis in May to discuss his revised expectations.

It seems relatively clear by now where we’re headed, but what isn’t clear is how long this is expected to last. Do you have any sense?

It’s difficult to forecast right now … I’ve had to become an amateur epidemiologist and … our expectation is, as we get into really June-July, that’s when we’ll start to see much of the country opening up, and we will have people going back to work. It’ll be slow going at first, but we are expecting to see the third quarter accelerate. If so, we’d have a 15% growth rate in the third quarter … but compared to a 25% decline in the second quarter, still not enough to fill the hole. As we get into the fourth quarter, our expectation is that you actually might see a further drop.

After the economy opens back up, what are the main factors working against recovery?

Consumer preferences might have shifted. People may not want to go out to eat at restaurants as often, or may not want to stay locked into their vacations, right? Not that these things go away permanently, but it’s going to take time for people to get comfortable again with the idea of going out and gathering in public places. So, by the fourth quarter you might get that second wave of economic weakness, and then it’s not until really 2021 we start to make some real progress in terms of seeing growth pickup once again. [The] bottom line is we think that 2020 is going to be a little bit bumpy—a sharp, downward shock, some recovery, a step back in fourth quarter, and then you start to recover.

When do you see consumer confidence returning?

Presuming we don’t have another large second wave or massive outbreak here, I think consumers will start to recover some of that confidence as things open up. The stimulus certainly does help. There are households out there that are actually earning more now because of the direct payments and the $600 in extra unemployment insurance that they’re receiving. So, if things are starting to come back online and people can see a light at the end of the tunnel … I would expect to see that third quarter confidence start to increase. It might pull back in the fourth quarter and then really it’s in 2021 when we would have more of a sustained increase in confidence.

Some companies have expressed concern that added unemployment benefits might keep people from coming back to work. What’s your sense there?

I think they’re right. If you look at the unemployment insurance payouts … the extra $600 per week can really make the difference between an incentive to go back to work or to stay at home. A part of that is certainly by design. There’s a virus, [so] we want to incentivize people to stay at home, because we want to try to avoid spread … If everyone’s at home and then everyone goes back to work at the same time, well that sets us up potentially for another wave of infections … that’s part of the reason why I don’t expect to see a very swift quick recovery over the next month or two … That said, I think workers, employees, they’re also mindful that this is a limited time extension, right?

The necessity we thought would drive housing through all but the worst of circumstances—what about this?

I’m still a “housing optimist.” I think housing will not only carry on, but it actually will be the engine of some growth … Sales are way down, permit activity and starts—all that’s going to be just nasty over the next couple of months … However, there are some positives. First of all, just comparing where we are today versus where we were during the great financial crisis, mortgages are on a much stronger footing … And then on top of that there’s still a lot of pent up demand out there. We had talked about housing shortages. That didn’t improve over the last few months, so there’s still a lot of people out there [who] want to purchase homes … I think that will start to build upon itself … Again, slowly, but I think it will be an engine of growth in 2021.

Executives

Deceuninck North America Names Walker VP of Human Resources

According to the company, Christina Walker has more than 22 years of experience, including with companies such as Amazon, and Pepsi Bottling. She oversees strategic direction of Deceuninck’s human resource functions.

Walker holds a master’s degree in human resources management and a doctorate in organizational leadership.

Global

Soft Tech Appoints Huber and Koegler

The company appointed Darryl Huber VP of global customer strategy and Bob Koegler to the position of global operations manager. Huber previously served as Soft Tech’s strategic account manager, North America, and now joins the senior leadership team in charge of a global team of strategic account managers. He’s served in various capacities across the fenestration industry, including developing new channels, engineering, testing, product development and sales and marketing. Huber is also a former AAMA Installation Master, as well as an instructor, and was president of the Northeast Window and Door Association, which merged with the Window and Door Manufacturers Association (WDMA). During his time at Soft Tech, Huber has been tasked with providing business critical fenestration solutions for customers, driving revenue growth and serving as a change agent for the business, officials say.

Koegler has more than 35 years’ experience in commercial construction. He now oversees the company’s support, training and implementation teams based out of India, Europe, Australia, New Zealand and the U.S. Prior to Soft Tech, he served as Southeastern service center manager for Assa Abloy, where he focused on improving operations and enhancing customer satisfaction.

Sales & Marketing

Kikerpill Appointed West Coast Sales Rep for Ensinger

Peete J. Kikerpill was appointed the new West Coast sales representative for Ensinger Building Products North America. Kikerpill succeeds Mike Gainey, who retired.

Kikerpill has more than 15 years of experience in doors, windows and facades, most recently with several leading West Coast manufacturers.

Energi Fenestration Solutions Adds to North American Sales Team

David Kline joined the company as director of U.S. sales, and Grant Muller now serves as a key account manager, working with U.S. northwest and overseas customers.

Officials say the company also retained the services of Lex Winans as an independent sales representative. Winans works with current customers in the Southwestern U.S.

To view the laid-in version of this article in our digital edition, CLICK HERE.