By Bobby Gill, lawyer, GC Wealth
While most analysts weren’t so hopeful about the future back when the COVID-19 pandemic started, the state of things has improved significantly since then. At the moment, 34 vaccines are in development, patient tracking has improved, and many people who have recovered from the coronavirus have developed long-lasting immune responses.
There’s also a positive shift in the economic sentiment as well. According to a recent McKinsey survey, more than 50% of business executives expect the economic conditions in their country to improve in the next 6 months. But what about now?
How much has COVID-19 impacted modern business? Will it have any more impact? What will we do in the aftermath? To answer all of these questions, we talked to Bobby Gill, lawyer and wealth management firm owner. His experience helped us get to the bottom of this.
Without further ado, let’s start.
The Supply-Demand Shock
As the crisis worsened, many governments started instituting lockdowns. This caused supply chains to experience something they haven’t experienced before, a supply-demand shock caused by people hoarding certain items.
The most obvious example of this is the shortage of toilet paper that occurred in multiple countries. As you know by now, the shortage wasn’t real. The manufacturers still had plenty of toilet paper in their storage units. However, the suppliers couldn’t deliver it in time due to the sudden increase in demand.
Once the general public caught on, a more rational fear started creeping up. A good number of customers across Europe and America started fearing that the food supply chain wouldn’t be able to bear the crisis and massive demand spikes, thus, leaving them without food, beverage, and other necessities.
However, supply-chain operators managed to keep everything under control. As a result, shelves around Europe, Australia, and North America have been fully-stocked at all times. A simple thing like this provided the people reassurance they needed at the moment.
More Transparency on a Global Level
In a business context, transparency means having complete, open, and honest communication within the company. The amount of such communication dictates whether or not an organization is considered transparent or not. Employees are the ones who judge this.
Since the pandemic started, many employers have been forced to become more transparent to keep their workers and themselves safe. According to a recent BBC survey of over 1,700 employees from the UK, US, and Canada, transparency is essential.
We discovered that organizations that managed to increase transparency have seen:
- 72% increase in employee satisfaction
- 85% increase in employee engagement
- 174% increased trust in leaders
Increased Consumer Confidence
In the beginning, retail sales lowered significantly, seeing how shoppers were forced to stay at home to prevent the further spread of COVID-19. Sales have grown since then, although they’re still far from regular. Nonetheless, new research indicates that even with limited movement, consumers are still regularly making purchases.
The research was done by the marketing company Selligent, which provides services to small retailers and big brands alike. Moreover, the stats come from a survey of more than 5,000 people in Europe and North America. What did the survey reveal?
A good percentage of people are still making purchases on a weekly basis. But as Bobby Gill says, they aren’t necessarily going outside to do this. More than a third of consumers now shop online every week. This is a noticeable increase from 28% pre-lockdown. Almost 30% of people now say that they shop more regularly online while 36% say that they do both equally
Another survey from the accountancy firm, EY reveals the mindset of UK shoppers. Not only are most UK consumers now regular online shoppers, 50% of them said that in the next few years they expect to shop in-person less and less.
Potential Recession (and a Bounce Back)
The economy needs to grow in order for a country to amass more wealth and consequently, to create more jobs for its citizens. As Mr. Gill explains, the growth of an economy can be measured by examining the change in value of goods a country produces or services it provides over a period of 3 to 12 months.
The problem is, the global economy as a whole is expected to shrink by as much as 3% by the end of 2020. Even though this may seem insignificant, this decline would be devastating. As a matter of fact, it would be the worst decline we experienced as society since the great depression 90 years ago. Bobby Gill points out that there is good news as well.
If the coronavirus stops spreading, or at least slows down significantly, we can expect to see the global economy to bounce back before the next year is over. As a matter of fact, the global economy is projected to grow around 5.8% in 2021 if everything goes as expected.
The story of the coronavirus pandemic of 2020 still doesn’t have a clear ending. In countries with developed economies, herd immunity will be likely achieved before the end of 2021. What we do know is that the coronavirus has had a tragic impact on many people’s lives.
Some businesses were destroyed due to COVID-19. Companies that are still functioning properly can’t leave anything to chance. As lawyer Bobby Gill points out, employers need to protect their workers, address upcoming challenges, and keep everyone safe while doing so.
On Bobby Gill, Lawyer, GC Wealth
As a wealth manager and a lawyer, Bobby Gill has more than three decades of experience The first part of his career was spent working in Magic Circle firms in London. Some of the firms he worked in include King and Wood Mallesons and Allen & Overy. A decade ago, he decided to depart from his then-firm to start his own business venture. As a result, he opened GC Wealth, a wealth management company that helps high-earning individuals manage finances.