By Charlotte Antoinette
The business world is no doubt under the pump following the fast developments of the corona virus internationally. The descriptor ‘Recession’ is being used internationally in a negative way to describe the downfall in the economy and pre-emptive rise in unemployment. However, there are multiple positives that can be focused on rather than the negatives.
What is a recession?
A recession is defined a period of temporary economic decline during which trade and industrial activity are reduced as a result of external circumstances. In simple terms, a recession is the result of people spending less money and consequently people earning less money. Therefore, a consequence of the Corona Virus outbreak has been a significant decrease in spending which may be primarily due to people staying in isolation however it also has been due to the uncertainty of job losses and increasing governmental restrictions on industries such as tourism and retail/wholesale. In addition, the downfall in the economy can also be due to the decrease in imports and exports from countries such as China where many retailers rely on other countries for the manufacturing of products. Therefore, evidently there are various factors that has impacted the economy and may result in a recession.
Many Gen z’s have been told by older Australians about the difficulties that will most likely face into the future in relation housing affordability in Sydney, however, the economic fluctuations occurring currently will most likely aid young people(still in work who are the majority) in their ability to buy housing.
As a result of deflating costs and decreased demand for discretionary expenses, prices are most likely to decrease and as a result, younger generations will have an increased ability to accumulate capital gain as the economy recovers in the future. Moreover, deflation will also occur for discretionary expenses such as clothing stores due to the decreased desire for materialistic goods at this time.
The current Corona Virus pandemic has also resulted in opportunities for businesses to grow and develop due to required adaptability of businesses to allow employees to work from home. The new ability of a large proportion of the workforce to work from home will most likely result in working from home becoming a more normalised way of working which in return may allow workers to have a greater work life balance due to an decreased travel time and increased efficiency.
In addition, an increase in employees working from home will also result in a decreased pressure on the transport system and increased traffic flow of the roads. Moreover, the increased pressure for individuals to act hygienically will hopefully assist businesses in increasing the hygiene standards of facilities into the future which consequently will decrease the amount of sick leave used by employees and decrease the reliance that individuals have on the public health system.
The current state of unknown that society is faced with is also providing opportunities for businesses to support one another and combat the virus together. Examples include
- Woolworths specifically allocated 5,000 out of 20,000 new job positions available to retrenched employees from Qantas
- Uber eats in Australia is giving away 25,000 meals to health care workers
- Amazon has pledged $5 million for local businesses based near its Seattle headquarters that will have lost sales due to Amazon’s thousands of staff that are working from home
- Facebook has said it will donate $20 million and Apple is committing $15 million to support coronavirus relief efforts
- In the UK manufacturers such as Ford and Dyson have began producing life saving ventilators due to the increased demand for this health necessity
- Netflix has reduced its European network traffic by 25% enabling less internet to be used on their program and instead allowing users to save some for working from home
Also, it’s important to remember some businesses that emerged out of past periods of economic downfall such as Walt Disney productions, which emerged in the middle of the Great depression, and Apple, which actually started 1975 during an economic downturn.
In the post COVID-19 era, we as a global community need to derive every bit of learning we can socially, economically, medically and spiritually to better isolate many millions of innocents from future catastrophes.
By doing so the global community will have derived some positive out of the current pandemic.