It seems that big investment management groups live to create proprietary indices for just about everything, so why not an index to measure the impact of the pandemic's impact on everyday life in the U.S.?

The Covid virus will probably never be totally eradicated, according to scientists, and it's unclear how long the pandemic will be a pervasive global threat. But according to the Return to Normal Index launched at the beginning of the year by Columbia Threadneedle Investments, as of Oct. 1 we’re running just 17% below “normal” across a range of indicators and may be just weeks away from hitting a normal range.

The Return to Normal Index was devised by the firm’s data scientists and fundamental analysts in an attempt to measure human activity relative to pre-pandemic levels. The expectation was that by selecting key categories and then adding data points throughout the recovery, a line graph would emerge, and therefore a prediction, that could be used to help evaluate companies in which Columbia Threadneedle was considering investment.

“It’s a roadmap for what normal activity might look like after Covid and how long it will take to get there,” said Paul DiGiacomo, head of equity research, in a statement. “The information allows us to test a company’s own assumptions and make adjustments in our views, as needed.”

The activities tracked by the index have included things like travel, returning to work or school, brick-and-mortar shopping, getting haircuts and eating out at restaurants. Economic indicators, like GDP growth or employment rates, were excluded in favor of a broad set of activities people engage in outside their home.

“We looked at a variety of components with [public and private] data sources, and then used a machine-learning algorithm to come up with weights for the index,” Chris Vandergrift, a senior analyst in global research, said in an interview. He added that the index excluded sectors of the economy that either benefited from the pandemic or suffered very little after the initial shutdown in the spring of 2020. “We really tried to map against the 20% of the economy that was most affected.” According to the index, Americans were at 58% normal activity in February, 76% in June and hit a high of 86% in August. September and October saw a regression to about 83% due to the rise of the Delta variant.

While 100% equals pre-pandemic normal, Columbia Threadneedle is considering “return to normal” to be a range represented by 90% to 100% of pre-pandemic levels. Unknown permanent shifts in behavior, such as exactly how many people will return to working in office buildings, make a range a more reasonable metric.

Looking ahead, there are two scenario trajectories the index is charting. The first is a base case scenario that has the U.S. entering the 90%-100% range somewhere between November and December. The second is the downside case, and there we need until around March 2022 to cross back into normal range.

The Return to Normal Index will remain around a while, Vandergrift said, even after the U.S. has been operating in the normal range for some time. “We’ll keep this as long as it’s relevant,” he said, adding that he expects it to then evolve into an index that tracks how the sectors that have changed and pivoted continue to fare. “On the other side, we’ll be looking at the activities that benefited to see whether they’re maintaining those gains.”