There is a sense of anticipation in the air. We are taking our first tentative steps out of lockdown, braving the cold weather, donning scarves and hats, and huddling around a pint in the pub garden. Well, for clarity, I should say that is the image I am seeing on the television rather personally going to the pub. But driving through my local town today it was noticeable that there were more cars out, there were many cafes with tables outside and a decent smattering of people enjoying their barrista brewed beverage.
I think character-wise I probably fall somewhere between being an optimist and realist, so I am largely hopeful that this time round the combination of the lock-down and the roll out of the vaccine programme will make for a more sustained lowering of the trajectory of covid cases and we can start to imagine that more normalised life that we have all been talking about for the past year.
So set against that background I have taken for inspiration for this week’s blog the special report in the Economist ‘The Future of work’.[i] There were a few noticeable trends emerging from this publication. First and not surprising, the piece highlighted the significant economic impact the world has suffered because of covid. Over the course of 2020 most countries were in recession. The only major economy to register growth – as measured by real GDP – was that of China, at 2.3%. Unemployment rates were also up, with one of the most significant changes in the US recording 8.9% unemployment in 2020 relative to 3.7% for the prior year.[ii] Conversely, stock markets continue to perplex me, with US markets showing 12-month positive returns not seen this side of World War II.[iii]
Notwithstanding the negative impact we have witnessed, the outlook for some of these measures is more sanguine. Research, including that of the Economist, suggests that we may be beyond the high points of unemployment and are witnessing a bounce back, although data is muddied by furlough schemes. The data that I found particularly interesting, however, is a change in corporate culture witnessed through the pandemic. One study[iv] witnessed a big jump in the average ‘Glassdoor culture and values ratings’ between April and August 2020, attributing this to senior management’s improvement in transparency and communication. The insight into employees’ home lives via Zoom calls has perhaps made companies focus on the person rather than the employee. The challenge will be for companies to recognise the positive impact of these behaviours and ensure they become long-lasting rather than a passing but necessary fad.
Increased working from home is one acceleration of trend that we expect to continue, but perhaps not to the extent that we might like. “Pre-pandemic American workers spent 5% of their working time at home. By spring of 2020 the figure was 60%.” The Economist suggests that employees would like to spend 50% of their time at home in future, but there is some growing resistance from employers, so perhaps the end state is going to be 20% – still a large increase on what was the norm pre-COVID.
There are fears that with people out of the office, companies may consider alternative ways of achieving certain functions and, with that, a rise in automation resulting in job losses. The Economist plays this down, pointing to many historical examples where fears of robots replacing employees did not materialise, if anything the reverse – improved technology increased levels of employment. I wonder if it may be more nuanced, however. Having recently signed up to Calendly an app that allows me to circulate a link to anyone with whom I want to meet, giving them access to my calendar and automatically booking in Zoom or Teams meetings. The past year has certainly focused our minds on how to work more efficiently and to a large extent more self-sufficiently.
We continue to live in uncertain times, but if the levels of covid remain low and we are able to venture back to pre-pandemic working, it will be interesting to see which working practices learnt over the past year will stay and which will become a distant memory to recall in years to come.
[i] The Economist, April 10th – 16th, 2021, p. 44
[ii] Source, IMF, https://www.bbc.co.uk/news/business-51706225
[iii] https://www.statista.com/chart/20939/year-to-date-performance-of-major-us-stock-market-indices/
[iv] https://sloanreview.mit.edu/article/how-companies-are-winning-on-culture-during-covid-19/
