This is the second part of a two-part article, including sections 4 and 5, please read Part 1 for sections 1) Unique event COVID-19, 2) The virus stimulates the economy and 3) Prospects for the US economy
“The economy was a very good photograph, while the pandemic turned it into a mosaic that ruined everything, now we are trying to put it together and find out if all the parts are still here or not.“
– Mohammed A. El Arian, Chief Economist, Allianz
The new COVID-19 virus has led the world economy to the deepest recession since the Great Depression, destroying the bonds that previously linked it. Two months of crisis, and economists are still trying to figure out what happened to supply chains and demand channels. As El Arian notes, key components of the economy may be absent.
Some components must be created. Then all these components will need to be transformed into a “new economy.” The task of economic recovery will affect consumer behavior. Consumer spending accounts for 70% of GDP. Thus, employment growth is critical to enhancing consumer confidence and recovery. The central question: how will the economy change its growth path? We will consider key guidelines in the process of constructing a new path of development, presenting the following topics: (first three of part 1)
COVID-19 – a unique event – explores the unique characteristics of a pandemic and how they determine specific economic trends. Part 1
The virus stimulates the economy. Examines how the virus controls the economy, how it gets out of control and what strategies are aimed at containing – Part 1
Prospects for the US economy – opens up a new perspective by superimposing the viral cycle on a deep U-shaped economic cycle and on how economic activity changes at each stage. – part 1
New economy – describes the transformation of our society and how these changes will lead to the loss and conquest of new enterprises, and how consumers are likely to have conservative costs and saving habits – Part 2
What we need to do to create a new economy recommends that the federal team of scientific experts gain the authority to manage virus protection, invest in self-renewing innovation centers in areas that are heavily affected by the pandemic, and focus on employment development on climate change solutions. Part 2
The new economy will feel different, much more virtual-driven by software, the Internet, and will be home-oriented. All major aspects of consumer behavior will be affected by the experience of panipression (a combination of panic, recession and depression), which opens up new opportunities for products and services. On the contrary, others will see a decline in demand and will be forced to close. Investors will want to observe these social trends as they unite in a set of needs where enterprises can flourish and become profitable.
Like the deep psychological scars of the 1930s, it will take time to restore the emotional, social, and mental damage from the pandemic. Today, a social trend called the Ameri-Kan spirit helps heal people in a wave of unifying, uplifting virtual programs. Celebrities, social groups and crowdsourcing teams use hashtag links on the Internet to raise funds for charities to provide financial assistance to employees of restaurants, hotels, farmers, meat processing workers, entertainment teams and thousands of others who have been fired or fired. This America-Kans spirit plus our entrepreneurial culture will create a new economic system that is sustainable.
Businesses will provide new services or products aimed at a cluster of behaviors related to values, social styles and desires. Social distancing will change our behavior, so behavioral groups will disappear, be stable, or begin to appear. In social terms, people need to be encouraged to travel, board a plane or experience outside their home when they have so many alternatives.
Let’s look at the key consumer and business segments and how they can be transformed:
Consumers will look for experiences they cannot get at home. We expect to see more experience-based travel packages that include hotel, food and experience, such as Costa Rica’s ecological tour, as your destination. For popular destinations such as Hawaii, Europe or Disneyland, attractiveness will still remain. However, for smaller resorts, villages, or cities with particular appeal, they will need to differentiate and create traffic in innovative ways to stay on the decline and decline stages. Airlines are already making “promises of pandemic cleanliness” and will continue to develop passenger safety. Hotels will also need to feel secure and focus on the attractiveness of their destination, amenities and services to a much greater extent than was required in the past. Local restaurants that have moved to clean up during the pandemic and survived will be able to return to their usual food if she has a new attraction. The food service industry is likely to be even more competitive than before, with the survival of the main chains and the failure of local restaurants during the block. The car rental industry has many options with some high-debt firms, so we can see industry consolidation.
Work at home
The house will become the center of attention for new services. More services will come into the house than ever before, with added features: food delivery and removal, car maintenance, pet care, mobile dentistry and linen delivery. Since workers are likely to have small savings and limited loans, car sales are likely to fall, and more will come to replace them. The auto industry will face a decline in car sales, but demand for cars from drivers and new autonomous car services will increase. Personal fitness or yoga training will be offered online, along with many personal development exercises. The number of car trips to work will decrease, as a result of which the demand for gas will fall below the level preceding the pandemic. Car rental for trips outside the region will be in even greater demand, as fewer consumers will own a car. E-commerce will continue to grow as people are used to having most things delivered to their home. Retailers will need to differentiate their offers based on experiences that consumers cannot get on the Internet. For example, going to a nursery to buy a plant means seeing the state of the plant. To close the sale, the consumer will want to ask an experienced gardener how to plant it and how to care for it. Shopping centers will need to develop attractiveness or experience to motivate consumers to leave their homes and shop.
Office or factory work
Soon, companies will find that if employees work at home as long as possible, it will reduce their costs. The need for office space is likely to be reduced, and the need for various support services, such as cafes, lounges, team rooms, etc., will decrease. The need for sharing office space for tenants will decrease. In the end, with the exception of key meetings, it is cheaper for their employees to work from home and eliminate or reduce office space, computer systems, utilities and all overhead in the employee’s office. Manufacturers will figure out how to achieve the same level of production using fewer employees. Production management systems will continue to be installed with sophisticated automation systems using AI functions. As more robots are installed, we expect them to remain in place, so manufacturing employment will not return to levels previous to COVID-19. Functions such as a contactless clock, automatic monitoring of employee temperatures, and other pandemic related services are likely to persist after COVID-19.
Consumers already using the Internet 24 hours a day will look for new ways to use laptops and Internet services. The demand for high-speed Internet services will be even greater. Many consumers use personal assistants such as Alexa. We expect that the use of personal assistants will help to find new users after their shelter. We can expect the appearance of additional functions of artificial intelligence added to “dumb” devices, such as refrigerators, for monitoring food consumption, developing recommendations and suggestions for the purchase of food products depending on their use. Home security systems today are observing how to turn on the light when a person walks from room to room. These systems can add employee temperature control so that companies know how healthy their employees are at home. It is likely that there will be increased stress due to blurring of family and family life, as well as problems associated with caring for a child. This stress can affect work at home, which is why firms will be interested in monitoring work at home. Businesses will be able to use retinal scans to determine how focused the employee is on their screen. The scan results will be communicated to companies to find out when their employees were at the computer, and for hourly workers, how many hours they worked.
After a pandemic, consumers will be obsessed with their physical fitness. Some consumers may expect their doctor to become a “health consultant,” helping them stay healthy with a focus on preventative medicine, diet, and lifestyle management. Artificial intelligence will be used in diagnostics, as drugs are becoming more complex and expensive, which reduces the doctor’s hours and costs. Telemedicine will become the norm for visiting, as patients will want to stay home if they can. In some cases, the size of medical offices and clinics is reduced, since the “local” visit to the doctor will be paid. Clinics will transfer some services to emergency care. Consumers will have even greater control over their health and will use more online counseling services and drug delivery applications. Using virtual stress reliever apps will take off to help people transition to a normal life, as they use mindfulness to re-enter the “real world”.
The merger of the Internet with television and streaming channels will be accelerated. Internet applications like polling, audience engagement, and 3D interfaces will combine with consumers who do household chores that they would otherwise do. During quarantine, artists opened their homes to produce programs that they usually did in studios. We expect more mixing of these personal “home-based entertainments” for entertainment to create an artificial intimacy with viewers who are not with them personally. The boundaries between films, television shows and games will continue to blur. For example, a Minecraft Games group with a host and multi-player options is becoming the norm. Focusing on delivering entertainment to your home means less need for studio space and expensive studio teams. Spectators will still need live concerts, although we expect to see more connections with virtual pre-concert events and games, as well as subsequent concerts with artists.
Higher education will switch to cheaper online education. College of online learning will become the standard. Personal training will be “optional” at the college level. The emphasis on online learning at home in primary school will create new stress for teachers and will require much more sophisticated learning software than is available today. Small colleges that focus on personal learning experiences will find it difficult to attract students to the stages of blocking or reopening pandemic control. We expect that many small colleges may be forced to close or combine their curricula and teaching staff with other larger schools that are able to attract a large enough student base to be financially viable.
Home sales will take a long time to recover from a pandemic in the market. Millennials are often fired first, have little cost savings and spend more on experience than on large purchases. Key incentives should be offered by builders and existing homeowners as the market slowly returns to pre-pandemic sales levels. The houses will be remodeled, and new houses will be built to meet the household needs for office space, enclosed family rooms and soundproofing to ensure the privacy of video conferencing. Apartments that offer plans and “work at home” opportunities will be in demand, while demand will be lower in small apartments. A pandemic can make home buyers think about leaving the city and its density in the suburbs, or even further, because they can use the Internet to do their job. The essential requirement of a home buyer that their home is near the office will no longer be critical in finding a home to buy.
Many banks have closed their retail offices due to social distance. We expect banks to close many retail offices as too expensive. Thus, customers to see a banker must make an appointment to see their banker in a specific department. Virtual banking will become the norm. Direct digital transfer of funds will grow, as a result of which banks will not transfer money, especially between customers and small businesses. Tap and Go credit cards will be the standard way to conduct transactions in stores without touching cards or checks. Digital wallets with financial account information will be readily accepted, as technically savvy millennials will become the dominant consumer group.
Consumers will think about money differently as a result of a panic experience. Lack of money for food, rent or utilities will leave emotional scars and teach new habits. Like the generation of the Great Depression, consumers are more likely to use fewer loans, increase their savings and be careful with the overuse of significant purchases. They will make conservative investments, like the baby boomers after the 2008 recession, who did not reinvest in stocks. Creating consumer spending is likely to take three or more years to reach previous levels.
The new economy will feel different, much more virtual-driven by software, the Internet, and the home center. All the main aspects of consumer behavior will depend on the experience of panipression, which opens up new opportunities for products and services. On the contrary, others will see a decline in demand and will be forced to close. Investors will want to watch for new social trends as they come together in a set of needs where enterprises can flourish and become profitable.
What do we need to do to create a new economy
Task. The most important next step is to contain the virus and give people confidence in their social life without fear of infection.
Proposal: Provide unifying intellectual leadership at the federal level to overcome the virus. People need support, compassion, and hope, and not disagreements between politics, disputes, and conspiracy theories as the foundation of politics. A federal team of scientists using facts, research, and cutting-edge methods to contain a pandemic should be empowered to quickly control the virus. Other countries, such as Germany, have concentrated their efforts on containment without policies leading to moderate success in containing the virus.
Self-healing investments in the economy
Objective: The rural areas of the country were already in a state of recession due to the fact that production capacities moved abroad. Пандемия разорила городские районы, где многие почасовые рабочие жили в тесных кварталах. Малые предприятия во всех регионах испытывают шок от временных блокировок, временно закрывающих свои предприятия, заставляя их оказаться на финансовом обрыве.
Предложение: Создание центров инновационных разработок новой экономики с использованием модели Силиконовой долины. Мы видим перспективу в использовании модели интегрированного партнерства Силиконовой долины между венчурными капиталистами, инкубаторами компаний, университетами и местными органами власти для создания новых предприятий. Модель использовалась в таких местах, как Портленд, Орегон с их Силиконовым лесом и в Солт-Лейк-Сити с их Силиконовым склоном для построения успешных самообновляющихся экономик. Мы рекомендуем использовать эту модель для охвата городских районов, сельских районов или любых районов, где пандемия нанесла ущерб местной экономике. Поскольку федеральное правительство имеет ограниченное финансирование, мы рекомендуем правительству выступать в роли «начального» инвестора, чтобы запустить эти центры развития с помощью партнерских инвестиций венчурных капиталистов и таких богатых компаниями, как Apple, Google и Microsoft. Чтобы обеспечить хорошо подготовленную рабочую силу, центры могут быть расположены рядом с университетскими городками и интегрированы в программы получения степени или сертификации. Департамент образования может оказать помощь в получении стипендий для работников, которым необходимо обучение и финансовая помощь для обучения в университетах.
Решения по изменению климата
Задача: хотя в течение следующих трех-пяти лет основное внимание будет уделяться сдерживанию распространения вируса и восстановлению экономики, проблема изменения климата по-прежнему остается нерешенной. Воздействие изменения климата уже ощущается в поднимающихся морях, наводняющих прибрежные города и мега-лесные пожары, уничтожающие миллионы акров.
Предложение: Фокус развития занятости в возобновляемых отраслях. По мнению экспертов, в результате пандемического экономического спада выбросы углерода сократились на 8% за последние два месяца. В последнем анализе изменения климата в США рекомендуется, чтобы сокращение выбросов на 8% в год продолжалось до 2030 года для достижения глобальной цели сокращения выбросов на 2 градуса Цельсия., Спонсируемая США организация «Инициатива по научным целям», состоящая из 890 компаний, одобрила смещение инвестиций и занятости в направлении достижения цели сокращения выбросов на 2030 год. Членами SBTI являются разнообразные компании из 165 компаний США, в том числе: Walmart, цельКока-Кола, Adobe, Microsoft, Hewlett-Packard, Owens-гранулирование, джакузи, Proctor & Gamble и Verizon. Мы должны начать решение следующей крупной глобальной задачи, сосредоточившись на федеральных, неправительственных организациях, частных исследованиях и развитии бизнеса, на инновационных решениях проблем изменения климата. Сосредоточив внимание на изменении климата для создания рабочих мест, мы решаем две основные проблемы: занятость и изменение климата. С таким большим количеством безработных работников мы должны перенести их навыки в новую отрасль, которая быстро растет и срочно необходима, предлагая долгосрочную карьеру.
Мы ожидаем руководители корпораций возьмут на себя ведущую роль в развитии занятости для долгосрочных экономических преобразований, поскольку политические разногласия будут продолжаться, Мы отметили в нашем посте: Пандемический айсберг поражает непотопляемую экономику США что необходимо создать ткань надежной системы безопасности труда, чтобы смягчить воздействие экономического кризиса, такого как COVID-19, на труд в будущем. В интересах руководителей строить предприятия, где рабочие процветают, а не просто выживают. Акцент должен быть сделан на создании инновационной экономики, которая создает новые рабочие места через предпринимательство. В противном случае мы столкнемся с застойной экономикой, зависящей от государственных трансфертных платежей. Мы заключаем со следующей декларацией из этого поста:
“Американцы построили самую инновационную, самообновляющуюся и создающую богатство экономику в мире. it Американский дух предпринимательства в сочетании с изобретательством, самопожертвованием, равными возможностями и креативностью создаст бизнес будущего, Эти новые предприятия будут приспосабливаться к новым социальным реалиям и проложат путь для работников, чтобы получить гарантию занятости и стать достаточно уверенными, чтобы тратить на устойчивые уровни ».