The Covid-19 pandemic significantly altered the human way of life all across the world, and our employment and working situations are no exception to this.

The Short-Term Impact of the Pandemic on Businesses

The pandemic affected every industry, but the short-term impact was felt greater by some industries than others. Restrictions in activities to reduce infection rates has meant that industries that rely on public interactions were worst hit. Restaurants, shops, hotels, gyms and recreational businesses were completely closed to the public for certain periods of time and the travel industry was also greatly affected due to the restrictions in place on travel to control the spread of the infection further.

However, businesses that don’t necessarily require public interaction were also affected. For the time during the pandemic that we weren’t allowed to leave our homes, businesses that didn’t have the resources or abilities to operate remotely couldn’t function, and unfortunately, a lot of them were unable to reopen since.

Job losses

A great number of people had to deal with job losses because of the economic shift and changes in lifestyle that have occurred due to the pandemic. According to BBC news there was an increase of 1.2 million people seeking jobseeker’s allowance or universal credit, jumping from 1.4 million in March 2020 to a staggering 2.6 million in April 2021, the peak times of Covid-19. Many of which were under-25s, since young workers occupy jobs within businesses that closed during the pandemic (pubs, restaurants, shops etc).

Business sales and profits

Businesses that were still operating while employees worked from home have had a significant reduction in sales and profits. This was a combination of factors including:

Products/services were not required during lockdown

Supply chain issues

Consumers no longer had an income with disposable income

Consumers were reluctant to spend due to the uncertainty of the future

Many employees were furloughed if they were unable to work from home. For employees that could work from home, many of them worked less due to having children who required homeschooling while schools were shut. The lack of employees working and fewer productive hours will had a sizable impact on business performance.

Essential businesses

Businesses deemed essential such as supermarkets were still able to operate at their usual capacity. They were required to do so under regulations which meant customers followed strict rules when carrying out their shopping. Due to supply chain issues, a lot of supermarkets were dealing with the added pressure of stocking their shelves. Other essential workers such as medical and healthcare professionals continued to work to help with virus infections. This was done under significant strain, due to the number of infections and lack of staffing because of essential workers also having the virus/needing to isolate.

The strain of the pandemic also led to many essential workers quitting their jobs or at the very least considering a career change. The Financial Times explained how the pressure of the pandemic has left a lot of healthcare staff feeling overwhelmed and undervalued, and the rate of job growth slowed significantly because of this.

Long-term Effect of Covid-19 on Business and Employment

Businesses are trying to adapt to the new way of life we have been thrown into since the pandemic. They have changed their operations, which has led to an unanticipated acceleration in remote working, e-commerce, and automation. This could increase the percentage of people potentially needing to change their occupations by 25% compared to that of pre-pandemic levels.

Remote working

The increase in remote working on a permanent basis has been beneficial for many businesses. They have discovered that in many cases, working from home is more productive for their business as employees enjoy the flexibility this brings. Many employees admit they wouldn’t like to go back into the workplace full-time. Businesses are also saving on overheads by not needing to pay for large office spaces.

Many people have achieved a successful routine working from home, however according to Forbes, some employees are now experiencing symptoms of burnout due to a lack of disconnect between the work and the home, and missing the peer support from an office environment. It’s likely that these workers will look for employment elsewhere, where they can enjoy a change of scenery and speak with people on a regular basis.

E-commerce

With e-commerce on the rise businesses can continue to grow. Instead of using their resources to invest in shop/customer interaction space, they will concentrate their investments on warehousing and transportation services.

Automation

Because of the dramatic changes in automation, we are likely to see a change in labour growth. There will be less demand for low-wage roles, with a lot of them becoming automated (retail, customer service and administration). We will see higher demand for more high-wage jobs which require specific skills and training. Many under-25s are also considering staying in education, due to the need for more secure, highly skilled jobs.

Healthcare

The need for healthcare professionals will continue to grow as more workers retire and have career changes. The amount of people looking to train in this area is at an all-time low due to the pandemic.

The cultural and economic implications of the pandemic will result in larger percentage of the population retraining and upskilling. Or, at the very least considering a career change for future security.

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