COVID-19 and its impact on business

The pandemic is a transformative global event, requiring fresh thinking.

We are barely grasping the nature of the global calamity that is the coronavirus (COVID-19). With everything that’s happening, it is hard to understand what this means for the future of business.

We will have regular updates including new insights (short and sharp expert-driven pieces that link to further in-depth resources), additional data and research, media commentary, timely, relevant and fresh perspectives on how COVID-19 might impact the economy, businesses, industries, governments and society. And of course our regular podcast update – Corona Business Insights.

Things are constantly changing and implications will only become clear over time. Our COVID Business Impact Dashboard will be a “living initiative” which will constantly update and adapt its insights and resources.

Listen to the latest: Corona Business Insights, regular podcast updates on the business impact of COVID-19

Click on a topic to skip straight to the insights.

Business

Business leaders are grappling with the realities of having the premises shut, relocating staff to their homes, experimenting with new ways of working, and the new realities of having to lay off vast numbers of staff. How can businesses keep afloat and how will it change the business landscape post crisis? Important questions emerge:

Will emerging digital work practices last beyond the short-term crisis? Will businesses learn from this pandemic and be more resilient for future crises? What will the role of open-plan offices in a world that has experienced extreme social distancing? What is the role of HR in a virtualised organisation where workers are isolated in their homes?


73% of Australian businesses accessed support measures

Source: ABS

550K

Number of additional shoppers Instacart plans to hire to meet US consumer demand

Source: TechCrunch

3hours

Roughly how much longer Americans are working each day during COVID-19

Source: Business Facilities

43%

Full-time US workers who would like to work remotely more often after COVID-19

Source: Statista


Recent insights

Moving with the times

Before COVID-19 the major 21st century challenges facing leaders were the ‘gifts’ of the fourth industrial revolution – big data, AI, robotics.

But the true instigator of change in the first half of the 2020 has been adversity and human hardship.

In mere months, collaborative remote working was the new normal, cinema goers became Netflix subscribers, online lessons and tele-health moved from a technological possibility to a necessity, contactless payment were no longer seen as a convenience but a ticket to play.

Transformation is essential but can lead to the mistaken urge to jettison ‘yesterdays’ people: If COVID-19 has taught us anything, it’s that now is the time for organisations to take more care of their people.

Here are three thought starters to harnessing people’s natural adaptiveness while keeping them inspired and motivated:

1. Harness the brand for continuity and buy-in

Successful brands – Apple, Louis Vuitton, PayPal – provide stories that bring people together to achieve what they can’t alone. Speaking to a greater purpose can galvanise people towards a common goal during difficult times – especially if it comes from the organisation’s DNA.

2. Find and connect your helpful hybrids and equip them to lead

Change champions exist at all levels in an organisation: They share the trait of being ‘helpful hybrids’ with established and trusted relationship networks while exploring new ways of working.

3. Build momentum from the ground up through micro-behaviours and perspectives

Start the change process in ‘small’ ways but with the purposeful aim of breaking old habits, opening the door to new ways of thinking and behaving. At Amazon Jeff Bezos’ rule of no PowerPoint meetings drove new engagement and ideas.

We are psychologically wired to focus on the negatives before thinking how we can break down the problem into manageable bites. Shift your mindset. Make the most of what you already have, connect it in new ways, and make little changes to take the next step. Most of all, take care of your people and they will take care of your organisation.

The ties that bind: lessons on risk in the time of COVID-19

Relationships are a boon and bane. The COVID-19 crisis is a perfect illustration of this truism. We have cultivated wide and deep international networks over decades. These have been important mechanisms for fostering and sharing global prosperity. But overnight, these same networks have turned into deadly conduits for spreading biological and economic disease.

The riskiness of a loosely connected world is different from the riskiness of a deeply connected world. In a loosely connected world, we are vulnerable to the few, highly connected business and economic giants that dominate and hold the entire economic network together. Remember the time when America sneezed and the whole world caught a cold?

But in a densely connected and tightly coupled world, we are vulnerable to every other player in the network. We’ve reached the point where anyone can cough and the whole world can catch COVID-19.

This has key lessons for managing crises and risks in a connected world. Our fortunes are tied to those of our key partners, suppliers and customers. Our connectedness precludes us from acting independently. Together we’ve built ourselves a network. Together we’ve reaped its benefits. So together we now need to act as a network to preserve it.

COVID-19’s temporary measures a long-term solution to road congestion

Australians have reduced their weekly household trips by 50%, according to research undertaken by Matthew Beck and David Hensher at the Institute of Transport and Logistics Studies.

This represents significant reductions in commuting trips and also those for social and recreational activities.

This level of compliance with stay-home orders demonstrates both a strong level of agreement that COVID-19 was a threat requiring drastic action and a high level of trust in the appropriateness of the restrictions demanded of us by governments. Organisations also played a vital role in swiftly facilitating working from home arrangements.

However our research also reveals the very success of this messaging has created a stigma around public transport. The concern is that even with the easing of COVID-19 restrictions the car will become more attractive as an ongoing bio-security measure – resulting in road congestion worse than before the pandemic.

To avoid hyper road congestion there are a number of policy responses that Government and organisations could get behind:

  • Working from home should continue to be encouraged (after the haphazard start  we quickly appreciated the productivity, equity and work-life advantages we had suddenly crashed into)
  • Active transport (walking, cycling) already boosted by the COVID-19 restrictions, should be further supported (bringing health as well as other benefits)
  • Peak-spreading, or staggering commuting hours, so we have less dramatic peaks (after all we have shown great aptitude for flattening curves)

As we leave the current state of consensus over action, to a potentially more difficult and more fractious period of easing restrictions, there will likely be a competition of ideas and opinions over appropriate action. We need to continue to support each other and maintain the resilience that has allowed us to come this far together.

What we’re reading

As Businesses Reopen, Some Workers Fear Returning (Wired, 05/06/20)

Your workforce will be split in two (Wired UK, 04/06/20)

How to monitor your employees while respecting their privacy (HBR, 28/05/20)

The CEO’s guide to safely reopening the workplace (MIT Tech Review, 28/05/20)

Facebook is for remote work to reduce wages (Bloomberg, 29/05/20)

Google gives workers a chunk of cash to build a home office (Digital Trends, 27/05/20)

Office work will never be the same (Recode, 21/05/20)

How to prepare your virtual teams for the long haul (HBR, 22/05/20)

Once you go remote, you should never go back (Forbes, 22/05/20)

Are traditional offices still required? (WSJ, 16/05/20)

Westpac mulls permanent remote staff (AFR, 12/05/20)

The era of offshoring U.S. jobs is over (NYT, 11/05/20)

The pandemic has exposed the fallacy of the “ideal worker” (HBR, 11/05/20)

Coronavirus grounded business travel. Will it ever come back? (Wired, 04/05/20)

PwC is building coronavirus contact tracing software for companies (CNBC, 06/05/20)

COVID-19 will fundamentally shift office culture in the future (Forbes, 05/05/20)

The cubicle is back due to the coronavirus (Wired, 30/04/20)

A call for shorter working weeks (The Atlantic, 30/04/20)

Remote Work Is Easy. Remote Hiring Is Hard.​ (Protocol, 29/04/20)

Remote work over the centuries: The Hudson’s Bay Company (Talking About Organizations, 14/04/20)

Covid-19 and the welcome collapse of “professionalism” (Quartz, 21/04/20)

All the things COVID-19 will change forever (Fastcompany, 20/04/20)

Who will be the winners in a post-pandemic economy? (World Economic Forum, 20/04/20)

Working from home might have benefits for women (ABC, 09/04/20)

Tech start-ups struggle to keep afloat (Geekwire, 29/03/20)

Small Businesses and the COVID-19 crisis (HBR, 27/03/20)

Demand for online work tools surges (The Verge, 26/03/20)

What will the ‘next normal’ for business look like? (McKinsey, 25/03/20)

COVID-19: the cost to business (NYT, 15/03/20)

Economy

Predictions about the impact of the crisis on the global economy vary wildly, but they all agree that the end result will not be positive. We are asking questions about the impact in its broadest sense:

How deep will the economic impact go? How will growth be affected locally and globally? Will we see heightened global disparity in countries’ economic performance of the coming years, depending on which pandemic response strategy they chose? Will social distancing put an end to the cash economy and spur digital alternatives? How will global supply chains be reshaped as a result of the crisis? What are the implications for capitalism itself?


GDP forecast, % year on year

Source: OECD

COVID-19 impact on stock market

Source: Google Finance

Predicted unemployment in Australia

Source: Grattan Institute


Recent insights

China helped Australia’s GFC recovery and it will again, but for different reasons

China’s economy is poised for a quick rebound. In March, factories reopened and in April, schools started reopening in China’s biggest cities. Daily coal consumption has returned to 90 per cent of pre-COVID-19 levels.

The Australia–China economic partnership was crucial for Australia’s GFC recovery. China became Australia’s largest two-way trading partner in 2007, accounting for 13 per cent (AU$58 billion) of total trade.

Ten years later, in 2018–19, two-way trade with China surged past AU$230 billion, well over double the volume of trade with Australia’s second-ranked trading partner, Japan (AU$88.5 billion). Nearly 40 per cent of Australian exports now go to China and one fifth of imports are from China.

The China trade effect that was concentrated on the resources industry after the GFC is now spread much more widely across Australia’s rural and urban industries.

Compared to 10 years ago, trade with China is more diversified and linked with a larger number of small and medium businesses in Australia. During the GFC, China was Australia’s top market for minerals, fuels and agricultural produce — products in high demand in China’s state-owned sector. Today, China’s middle-class consumers have become Australia’s top market for high-quality consumer products such as food, beauty and health products, as well as services like healthcare, tourism and education.

Australian small and medium exporters are targeting China’s expanding middle class. According to Alibaba, during the 24-hour Singles’ Day sale on 11 November 2019 Australia was the fourth-ranked country selling into China — behind Japan, the United States and South Korea but ahead of Germany.

Australia is facing a bigger crisis now than it did post-GFC, and it is also more closely interconnected with China. This makes the Australia–China economic partnership even more important than it was post-GFC.

The gig economy: a tale of two workers

It’s been the best and the worst of times for gig workers as COVID-19 spawns two classes of employees: The under worked vs the overworked.

Drivers in the personal transport sector, your friendly Uber, Lyft or Didi driver, shuttling people between work, home from a party or a night at the theatre – have found their incomes crashing.

At the same time gig workers in warehouses or delivering consumer goods have never been busier. And those deemed essential have been fortified in their expectation of improved working conditions.

Strikes by Amazon workers protesting about COVID-19 contaminated worksites have spread to other locations staffed with gig employees also demanding better pay and conditions.

Will their bargaining power translate into long term labour reforms? Or will it last only as long as the pandemic?

There is also the possibility employers will try to pit gig worker against gig worker – swamping the pool of in-demand employees with the millions of now second-class unemployed gig workers.

It remains to be seen if the gig workers’ weapons of choice –messaging apps – remain a key organisational tool in their fight for decent conditions, or if these platforms are turned against them in the struggle to have a job, any job, at any cost?

What we’re reading

Is Coronavirus pushing us towards a cashless society? (Euronews, 03/06/20)

Australia is in a recession – but worse is yet to come (Guardian, 03/06/20)

How mobility could play out after coronavirus (Axios, 30/05/20)

the new credit market system could be better for businesses (WSJ, 27/05/20)

The stock market and consumer sentiment are telling different stories (WSJ, 27/05/20)

The future of work could look like the past (NYT, 24/05/20)

Is Prince Charles using the pandemic to take on capitalism? (Vanity Fair, 22/05/20)

Will COVID-19 have a lasting impact on globalisation? (HBR, 20/05/20)

Why economic forecasting is so difficult in the pandemic (HBR, 18/05/20)

Coronavirus sent shockwaves through the Australian job market (ABC, 14/05/20)

The temporary pandemic layoffs that could become permanent (Axios, 12/05/20)

The coronavirus recovery may take months (Axios, 13/05/20)

EU faces recession of historic proportions (NPR, 06/05/20)

The U.S. is not headed toward a new great depression (HBR, 01/05/20)

Economists on coronavirus and capitalism (Guardian, 06/05/20)

A visual guide to the economic impact of COVID-19 (BBC, 30/04/20)

Why a ‘Greater Depression’ for the 2020s is inevitable (Guardian, 29/04/20)

How coronavirus will upend the economy over the next year (Wired, 28/04/20)

Get ready for the ‘Novel Economy’ (ZDNet, 20/04/20)

Shutdown: estimating the COVID-19 employment shock (Grattan Institute, 19/04/20)

Who’ll pay for global recession? (Economic Times, 16/04/20)

Virus will leave an economic impact for decades (SMH, 07/04/20)

The great deflation threat (Washington Post, 06/04/20)

Paul Krugman says we are ignoring a fiscal time bomb (Business Insider, 02/04/20)

What we get wrong about the toilet paper shortage (Medium, 03/04/20)

Why the Global Recession Could Last a Long Time (NYT, 01/04/20)

Four futures of how economic systems might change (The Conversation, 30/03/20)

Inflation might increase after the crisis (Barron’s, 27/03/20)

Australia says good bye to 30 years of growth (NYT, 27/03/20)

What is the shape of the COVID-19 shock (HBR, 27/03/20)

McKinsey’s continuous analysis of the economic impact (McKinsey, 25/03/20)

A recession will be unavoidable (NYT, 21/03/20)

The fragility of just-in-time supply chains (The Atlantic, 26/03/20)

Bitcoin is not a safe haven investment (MIT Tech Review, 19/03/20)

COVID-19 is a chance to do capitalism differently (Guardian, 19/03/20)

Industry

With businesses in many sectors struggling and closing their doors as a result of the COVID-19 response and other industries seeing surges in demand and their services expand, we ask questions about the lasting future implications across industries:

As the travel industry is one of the earliest and hardest hit, will tourism and business travel undergo lasting transformations? Will large technology companies (big tech) benefit from the crisis and emerge stronger than before? With the growth in online streaming, what are the implications for the film and movie sectors? What is the impact on sports, worldwide and locally; will Australia be able to sustain its indigenous sports codes?


Chinese industrial production down 13.5% in the first two months of 2020

Source: China National Bureau of Statistics

Total hours watched on game streaming services in Q1 2020.

Source: Streamlabs

52%

Decrease in commercial flights around the world, last week of May year-on-year

Source: Flightradar24

17.7%

Drop in Australian retail turnover from March 2020 to April 2020.

Source: ABS (revised 4 June 2020)


Recent insights

Virtual work experience – a positive pandemic outcome

While COVID-19 has reshaped Australian higher education with online course delivery, Zoom consultations and AI exams, it hasn’t changed the critical role of higher education in preparing students for the job market.

Work-integrated Learning (WIL) programs such as placements, study tours, industry practicums and industry and community-based projects are considered instrumental for equipping graduates with the required employability skills to function effectively in the working environment. However, travel bans and social distancing rules during this pandemic period have made it impossible for students to engage with industry partners and mentors in person. Most WIL programs have been cancelled.

However virtual WIL programs are becoming the ‘new norm’. We partner with Make a Difference Travel in the Philippines to consider their online WIL program focusing on social entrepreneurship and sustainability. Prior to COVID-19 the program was delivered in the field: the team has promptly developed e-learning resources and online mentorship in response to the global crisis. The experiential online learning includes authentic video content that introduces social enterprise, sustainability and design thinking in the Philippines. It allows students to interact with entrepreneurs and to explore solutions to business challenges. The guided online learning aims to provoke students to inquire, reflect and pursue further study in the area.

While its effectiveness is yet to be studied, the experience inspires us to reconsider WIL curriculums in higher education. Perhaps virtual international WIL is an alternative program, offering employability skills development that is at a lower running cost, easier for risk management, and with fewer restriction on the number of participants, geographical locations and time?

The future of education is co-opetition

University education is in crisis. While COVID-19 has dramatically accelerated the delivery of online lessons, in doing so it has raised questions about the primacy of campus-based learning.

Both deliveries have to justify the extraordinary amount of money that students are paying. Scott Galloway, amongst others, has brilliantly led discussions on what the future of education looks like in terms of universities and teaching faculties.

Let me nail my colours to the mast and declare that campuses are here to stay – but they will be altered institutions.

Fundamentally there are three types of courses, and the teaching method should be determined by the type of course:

Firstly there are courses that can be taught 100 percent online: where the teacher is imparting enduring skills that don’t change over time. What my teacher in Math 101 was teaching 10 years ago is pretty much what he is teaching now.  Ditto for microeconomics. Insendi has some brilliant courses in these and other subjects.

The second course category are those requiring constant interaction between students and teachers, and among students themselves. 100 percent offline is required. Knowledge is co-created through discussion and collaboration. For example, it’s difficult to teach culture and leadership fully online: leadership is more than theory, it’s observing amazing people and appreciating nuances in how they think and behave. 

Thirdly there is the blended classroom: Courses such as Strategy, Supply Chain Management and International Business are examples of courses that can accommodate both online and in-person teaching methods. Such courses are composed of different sorts of knowledge that require a mixed teaching pedagogy.

Universities need to focus on those subjects that can mix online and off-line while leveraging some great online resources created by top notch scholars. I see a future of collaboration across universities for the creation of some fundamental, shareable material combined with competition around the individual strengths of particular scholars.

As public transport operators fight for survival, changes are needed to withstand future shocks

The public transport sector is hurting. After a summer of bushfires, travel bans and now COVID-19, the commercial/charter market has seen its revenue streams vanish. Many operators have stood down workers and deregistered their buses.

Contracted operators have incurred greater costs and those with large patronage incentives are looking to invoke ‘force majeure’ clauses as passenger numbers plummet. Around the world, services are being cut and governments have stepped in to underwrite services—as has occurred in the aviation sector.

Transport operators are fighting for survival as COVID-19 measures have brought enormous cost and revenue pressures. The result could be market consolidation and less competition in the industry.

The strategic and financial consequences of these external shocks call for urgent reform in the procurement and funding model of public transport to ensure its continued financial viability. New governance models should shift operators away from mere compliance with incentives for innovation and value creation.

Future contract design should ensure that transport services and assets will be more resilient in responding to other ‘black swan’ events.  In the area of sanitation technologies, the swift deployment of fogging, ultraviolet-C and robotics coupled with AI powered video analytics for crowd management should be under consideration now.

The return to work period will also necessitate the restructuring of services to better meet a changing demand landscape with biosecurity concerns at the forefront of service delivery.

The future of the film industry: With cinemas dark, all eyes are on streaming

The COVID-19 crises is set to have an enormous impact on the future of the film production and distribution sector, with the future of the night out at the movies in serious doubt. Billions of dollars are bound up in blockbuster film productions that have been completed but cannot now be released, as cinemas had to go dark due to COVID-19 lock downs globally.

For example, movies such as Top Gun: Maverick, Wonder Woman 1984, Marvel’s Black Widow, or Disney’s Mulan are all awaiting their first screenings. In the pre-Corona world movies would always see the light of day at the cinema first, with a well-spaced release window before they make their way to DVD or the TV screen. But these are not normal times. Streaming services all have seen between 20-30% jumps in viewership during the first few weeks of the crisis.

Thus, the pressure for film studios to unlock the millions or even billions of production capital tied up in already filmed but unreleased movies is now mounting. Yet, if studios were to decide to collapse the release window and put these blockbusters straight to the small screen, such as through their own streaming services, this might have lasting effects for the future of film distribution and the survival of the cinema experience.

What we’re reading

Coronavirus turmoil fuels the rise of AI-powered companies (Reuters, 17/06/20)

Surging renewables, COVID-19 pile more pressure on coal (SMH, 08/06/20)

Will the Pandemic Push Knowledge Work into the Gig Economy? (HBR, 01/06/20)

Coronavirus brings the age of drones closer (Axios, 30/05/20)

How coronavirus lockdowns have changed energy demand (World Economic Forum, 27/05/20)

The pandemic could change air travel forever (Recode, 27/05/20)

Wild ideas to bring back sports might say more about cities than leagues (NYT, 01/05/20)

Tokyo Olympics to be scrapped if not held next year (Al Jazeera, 21/05/20)

Coronavirus is accelerating the rise of alternative meat (Grist, 23/05/20)

The A380 could be the aircraft industry’s first pandemic victim (SMH, 21/05/20)

The pandemic will permanently change the auto industry (NYT, 13/05/20)

Can the restaurant industry be saved? (Rolling Stone, 11/05/20)

Air travel is going to be bad for a long time (The Atlantic, 11/05/20)

Selling products via live-streaming in China boosts recovery (MIT Tech Review, 06/05/20)

Looking to the future of air travel (HBR, 04/05/20)

The Coronavirus and the future of big tech (The New Yorker, 29/04/20)

The myth of Silicon Valley innocation (MIT Tech Review, 25/04/20)

Why coronavirus will accelerate the fourth Industrial Revolution (The Economist Intelligence Unit, 24/04/20)

Instacart hires 250,000 new workers (TechCrunch, 24/04/20)

The coronavirus is blowing up the media landscape (Vanity Fair, 21/04/20)

Gaming sales are up, but production is down (NYT, 21/04/20)

Australia’s manufacturing pivot in a post-coronavirus world (ABC, 19/04/20)

Travel Experts predict the future of travel (Forbes, 05/04/20)

Can Airbnb Survive Coronavirus? (Citylab, 03/04/20)

Bigtech will emerge stronger than ever (NYT, 23/03/20)

How the crisis might affect Facebook (Seeking Alpha, 05/04/20)

Tech predictions for a post-corona world (Forbes, 03/04/20)

Food shortages loom as work force goes missing (CNBC, 30/03/20)

Fintechs are likely to struggle (SMH, 28/03/20)

Bigtech will emerge stronger than ever (NYT, 23/03/20)

COVID-19 might have killed the Techlash (Wired, 20/03/20)

COVID-19 could lead to mass exodus in restaurants (The Daily Beast, 19/03/20)

Economic effects for the Sports industry (FiveThirtyEight, 16/03/20)

The aviation industry might never recover fully (The Economist, 15/03/20)

Society

Social distancing presents an unwanted and unprecedented societal experiment which might have long-lasting effects on how we organise public lives, what freedoms citizens will enjoy and how we will interact with each other in the future. We ask:

How will our collective life-styles adjust after months of social distancing? Will we experience a wave of loneliness and mental health problems or re-connect with each other in new and meaningful digital ways? Will COVID-19 lead to a greater acceptance of state surveillance and individual tracking, to effectively isolate infection cases? What are the implications for our global climate response as COVID-19 grabs public attention? Will we find new ways to curb misinformation as a result of the COVID-19 experience?


Pollution in Europe

(NO2 levels April 2019-2020)

Moving image showing differences in pollution across Europe in April 2019 and April 2020

Source: European Space Agency

56%

Less Sydney morning traffic compared to usual (100%)

Source: Citymapper (19 June 2020)

15.8million

Increase in Netflix subscribers during Q1 2020

Source: Netflix

30%

Month-on-month increase in calls to Beyond Blue in March 2020

Source: ABC News


Recent insights

The pandemic, poverty and business

Developing countries now account for three quarters of new COVID-19 cases: the next phase in this pandemic is unfolding in the context of poverty.

Recent evidence from UNU-Wider suggests over a billion people are living in poverty and that the global poor could be losing $500 million per day due to the impact of the pandemic.  While countries such as Australia, have been successful in suppressing the virus, in other countries poverty is a barrier to containing the outbreak.  It is in everyone’s benefit to deal with structural issues such as poverty, arising from the pandemic. 

Countries including Australia are looking at a business-led economic recovery.  Coming out of the pandemic the initial reaction of companies will be to focus exclusively on the bottom-line. However in order for businesses to effectively lead this recovery and to differentiate themselves from others, they have to deal with the inherent issues arising from the pandemic, including poverty, job losses and other social issues such as gender inequality and hunger.

In 2019 The Business Round Table of CEOs redefined the purpose of business to stakeholder value rather than shareholder value.

Increasingly consumers, governments and civil society expect businesses to broaden their purpose.

Companies that proactively take on social issues such as poverty alleviation (at a profit) are more likely in the long run to both economically lead countries out of the pandemic, and to gain long-term advantages that have commercial benefits.

International students: It’s not just business

International students lift the bar for Australian students, and contribute to a thriving, multi-dimensional learning experience for “Aussie kids”. It saddens me deeply to see international students talked about merely in monetary terms.

While there has been a lot of focus on the aggregate contributions that international students have made, I want to focus on my own experiences. I am in almost every way a middle class white Australian male. I grew up in a rural community of 1600 people, 8 hours from Sydney. I did not see my first “non-Australian” face until I was 14 and that was because a Japanese family (for reasons I still cannot fathom) came all the way to rural Australia to teach maths for a year in the region’s high school.

Today, I get to walk into a classroom filled with the faces of people from, at my latest count, at least 50 countries. We share our quirks, our customs and our cultures. We enjoy a joke. We also share intellectual problems, the pursuit of solutions and the discovery of a brilliant idea.

I see the contribution that can be made by those who have come half a world away to study. They accept the challenge to study at a high level in a foreign language far from family and friends. They do so in the pursuit of a broader mind.

They also come with fears, the burden of expectations and immense financial pressure, having to work across an assortment of casual jobs. Many of these students are facing hardship as a result of COVID-19 quarantine as they are outside State and Federal government assistance.

While there are challenges associated with size and composition of the international student cohort, overall international students have enriched the experiences and perspectives of those in the classroom, myself included.. Not bad for a boy from Whoop-Whoop.

How China got through the pandemic crisis, relying on people, not technology

Transitioning to work online was out of question for workers in Wuhan, the first city in the world to go into lockdown.

Wuhan’s 11 million residents were preparing for Chinese New Year when the city was shutdown literally overnight. The lockdown lasted 76 days and in this high-tech hub it was people power that kept essential services flowing.

One of the world’s major technology powerhouses, China was caught off-guard when the pandemic hit.

 Even with the worlds’ most sophisticated tech available to facilitate working-from-home, such practices were never widely rehearsed before the crisis.

Like neighbouring Japan and South Korea, China’s work culture is about being present and staying in the office for long hours. As the first to experience COVID-19 and without people being at least somewhat familiar with remote work, technology alone was powerless to take work online.

For an e-commerce giant, online shopping in Hubei, the most affected Chinese province, was nearly halted during the lockdown due to the restriction on movements of people and goods.

Despite its agile technology culture, e-commerce remained stuck in the “business as usual” ethos. When things suddenly changed and residential compounds became confined spaces during the lockdown, it was back to “no-tech” or “low-tech” with people moving and distributing essential goods door-to-door.

Fresh produce and essential goods were delivered to households by mobilising the local “community services” staffed by neighbourhood Party committees.

It was the human touch that stood up to the challenge faster and firmer than tech did.

What we’re reading

This is online learning’s moment. For universities, it’s a total mess (Wired UK, 02/06/20)

How cities might change if we worked from home more (BBC, 01/06/20)

Why a four day working week could save us and the planet (Euronews, 01/06/20)

Reading the blueprints for our future after the virus (OneZero, 27/05/20)

It’s OK to find humour in some of this (NYT, 22/04/20)

How the pandemic could change our homes forever (The Conversation, 26/05/20)

For some people, returning to ‘normal’ might be scarier (The Conversation, 25/05/20)

The absence of sports feels like a loss for fans (Washington Post, 22/05/20)

The pandemic may forever change the world’s cities (Washington Post, 20/05/20)

The gym as you know it is a thing of the past (Vice, 14/05/20)

The lockdown live-streaming numbers are out, and they’re huge (The Verge, 13/05/20)

The 10 US cities best positioned to recover from coronavirus (Forbes, 12/05/20)

Our cities may never look the same again after the pandemic (CNN, 10/05/20)

Your daily commute won’t ever be the same (National Geographic, 11/05/20)

Urban design must adapt to coronavirus risks and fears (The Conversation, 07/05/20)

Sydney’s CBD could look very different after coronavirus (ABC, 05/05/20)

The coronavirus is rewriting our imaginations (The New Yorker, 01/05/20)

Record 50 million people internally displaced (Axios, 28/04/20)

How cities are reshaping streets for life after lockdown (Fastcompany, 27/04/20)

The pandemic might make buildings sick too (World Economic Forum, 26/04/20)

Many COVID-19 survivors will be left traumatised (MIT Tech Review, 22/04/20)

How is the coronavirus pandemic affecting climate change? (Wired, 21/04/20)

Time is meaningless now (Vice, 10/04/20)

COVID-19 might stall climate response (MIT Tech Review, 10/04/20)

Will the crisis have a lasting effect on pollution (National Geographic, 08/04/20)

Poachers Kill More Rhinos as Coronavirus Halts Tourism to Africa (NYT, 08/04/20)

Big Tech uses data to fight coronavirus (The Verge, 07/04/20)

Fighting the Coronavirus Infodemic (Wired, 30/03/20)

Life after Corona might not be that different (Huffington Post, 28/03/20)

New values and habits after the pandemic (Forbes, 28/03/20)

Our cities will have to change (Citylab, 27/03/20)

How the Pandemic Will Change Our Homes Forever (dwell, 26/03/20)

How COVID-19 might change the way we live (Mashable, 25/03/20)

COVID-19 lockdown hampers climate response (NYT, 19/03/20)

What COVID-19 tells us about failed responses to climate change (Scientific American, 17/03/20)

How to fight the infodemic with social media (MIT Tech Review, 17/03/20)

How COVID-19 will change how we shop, work, travel (Bloomberg, 14/03/20)

Government

While governments everywhere scramble to organise the response to the COVID-19 pandemic, we are curious about what future changes our collective experiences with the response will bring to government systems and institutions:

What are the lasting impacts for employment and social security systems? Will there be renewed appetite for a serious consideration of Universal Basic Income? How will the pandemic shape public health systems? Will we see a surge in universal health? Will the experiences the global search for a vaccine lead to lasting changes in the status and funding of scientific research? How should policy responses be organised to govern a world that has learned from the COVID-19 crisis?


100+ countries have travel restrictions

Source: IATA, BBC

16.4%of GDP

The Australian Government’s total support for the economy as of 1 April

Source: The Treasury

$597billion

Potential loses for the city of Tokyo due to Olympics being postponed

Source: Statista


Recent insights

Principles for a policy response to COVID-19

In addition to the pressing public health crisis, Australia, like so much of the world, currently faces an unprecedented public policy challenge. Few of the specifics of the response to that challenge are yet clear and it would be foolhardy of anyone to pretend otherwise.

It is vital to engender clear-minded public debate as to what those principles should be and for us all to play a part in assisting decision-makers in these moments of deep stress.

Here we outline our own five core principles.

We put them forward both in the hope that they can guide policymakers now and that they can stimulate widespread discussion about the best way in which to take Australia forward.

  1. Fair and equal access to healthcare
  2. Shared economic sacrifice
  3. Enhancing social relationships
  4. Protecting democracy, rights and liberties
  5. Building a sustainable future

None of the principles above are designed to generate specific, individual policy responses. They are intended instead to act as a set of criteria by which such proposals for such responses can be judged and debate initiated.

Who is the government’s COVID-19 rent relief package really helping?

The Federal and State Governments’ rent moratorium for tenants is a compassionate gesture that appears to take the moral high ground but will leave landlords languishing in a quagmire when the COVID-19 crisis is over.

In reality the ‘rent relief packages’ are highly problematic, impractical and ignores the underlying ‘domino effect’: the various complex contractual arrangements landlords have with many other parties (such as banks, real-estate agents, insurance, other service providers and creditors). For example, the landlords who outright own their investment property and rely on rental income as the only source of income stream (e.g., self-managed superfund retirees) will be disadvantaged by the PM’s ‘sympathetic’ gesture.

There are also landlords who are physically incapable of working or who solely rely on rental income to feed their family. Further, many landlords finance their rental expenditure from their rental income. If this rental income is hijacked by the government’s inapt and unclear rules that are at best, open to the vaguest of interpretation – then it will come as no surprise that landlords (irrespective of commercial or residential) will be the losers juggling legally enforceable contractual agreements with the banks/insurance/creditors to meet financial obligations and forceful rent sacrifice.

To add insult to injury, landlords’ mortgage obligations have been seemingly watered down with creative terms and buzz-words such as “rent holiday”, “rent relief” or “rent freeze” – all of which assume zero penalties or costs when a landlord is forced to negotiate with a bank or insurer in a rent default situation. 

This ‘solution’ has created a mess for landlords and their tenants to sort out. Governments should refrain from making further responses which are ambiguous and unilaterally favour tenants to the detriment of landlords, without any reasonable and commensurate compensation scheme for landlords.

The government’s desperate measure to save tenants from financial distress appears to be a Robin Hood style attempt to steal from Landlord Peter to feed Tenant Paul.

Our corporate regulator’s response

Recent events surrounding the impact of COVID-19, and the resulting effects on business, have been creating great uncertainty, with an appreciable effect on global securities markets. In response, the Australian corporate regulator, the Australian Investments and Securities Commission (ASIC) has announced its COVID-19 regulatory priorities.

ASIC has a very wide set of responsibilities and says it will focus on those areas where there is “risk of significant consumer harm, serious breaches of the law, risks to market integrity, and time-critical matters”. Furthermore, ASIC will suspend or defer non time-critical matters including industry consultation, regulatory reports and reviews.

ASIC is to be congratulated for its pragmatic approach in these difficult times, which will allow businesses to focus on their own responses to the many challenges now confronting them. While criminal activity and misconduct must never be tolerated, now is the time to appropriately enable business to address the issues which affect their key stakeholders, including not only their shareholders, but also their customers, clients and employees, as well as the wider community.   

What we’re reading

What Will It Take to Reopen the World to Travel? (NYT, 03/06/20)

How to prepare for the next pandemic (World Economic Forum, 02/06/20)

What restarting the economy means for climate change (NYT, 29/05/20)

Thousands of predicted COVID-19 deaths that never eventuated (SMH, 27/05/20)

Failing to reopen Purdue University would be a breach of duty (Washington Post, 25/05/20)

The end of the new world order (NYT, 23/05/20)

Immunity passports could help end lockdown (The Conversation, 21/05/20)

Mnuchin and Powell warn of economic scarring, and offer divergent solutions (NYT, 19/05/20)

How coronavirus is reshaping Europe in dangerous ways (Guardian, 14/05/20)

Coronavirus pandemic sees spike in demand for tiny homes (ABC, 16/05/20)

Elite cyborg universities will soon monopolise higher education (NY Magazine, 11/05/20)

How the world is tackling contact tracing (Canberra Times, 04/05/20)

Travel bubbles could be a modal for the future (CNN, 04/05/20)

Can antibody tests detect coronavirus mutations? (CNET, 07/05/20)

Digtial contact tracing doesn’t have to sacrifice privacy (Gizmodo, 30/04/20)

How crime changes during a lockdown (The Conversation, 02/04/20)

Prepare for less privacy (Axios, 29/04/20)

800,000 jobs go in three weeks amid Depression warning (SMH, 21/04/20)

Beware a new wave of populism post-coronavirus (Guardian, 19/04/20)

Could big tech be better at tracking COVID-19 than the government? (OneZero, 14/04/20)

Spanish Government Aims to Roll Out Basic Income ‘Soon’ (Bloomberg, 06/04/20)

The crisis aggravates gig work disputes (Wired, 30/03/20)

Key union proposes UBI in Australia (SMH, 26/03/20)

The US chooses mass unemployment, while Europe tries to preserve jobs (NYT, 26/03/20)

Andrew Yang’s UBI idea is popular again (Washington Post, 23/03/20)

The US uses marketing databases to track COVID cases (Forbes, 30/03/20)

The UK opts to secure jobs by subsidizing wages (BBC, 20/03/20)

A call for UBI in the US (Guardian, 20/03/20)

Tracking virus spread with smartphone app (NYT, 19/03/20)

Europe vs China: COVID-19 and political systems (NYT, 19/03/20)

Click on a topic to skip straight to the insights.

As COVID-19 sets out to change the world forever, join us in thinking about what’s to come

Part of the University of Sydney’s Business School’s strategy is to disseminate and generate new insights on the future of business. We come together using our expertise, available data, models and draw on imagination, new thinking and new understandings to respond.

If you want to contribute your own research or expert opinion on any matters of how COVID-19 impacts the world of business, please contact us or join the conversation.

sbi@sydney.edu.au
@SydBusInsights
Sydney Business Insights

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