I remember 16 years ago asking my doctor after surgery for an injury, “how long until I can expect to be back to 100%?” He replied, “you won’t ever be back to 100% — expect more like 80-90%.” I had stepped through the door into a new normal.
It wasn’t my first experience transitioning to a new normal: We all experienced a shift to a new normal together as a society following 9/11 when we exchanged some of our personal freedoms and chunks of our privacy for an enhanced sense of safety.
Will the COVID-19 pandemic trigger a new normal? Most certainly.
The editor-in-chief of the MIT Technology Review posits that “This isn’t a temporary disruption. It’s the start of a completely different way of life.” The consulting firm McKinsey concludes in a recent report “It is increasingly clear our era will be defined by a fundamental schism: the period before COVID-19 and the new normal that will emerge in the post-viral era.” The global think tank Chatham House predicts that “an economic shock on the present scale will have a lasting, and potentially transformational, impact on the global economy.”
What might a post-Covid world look like? I’ve been researching this over the past few weeks and have found thoughts by leading firms and think tanks about what changes we might see. I’ve summarized and linked to what various experts predict as the likely changes. Note, however, as Yogi Berra once said, “It’s tough to make predictions, especially about the future.” Additionally, trends are hard to spot, especially in their infancy. With those caveats, let’s look at some potential changes.
Acceleration of Existing Technological Trends
Lenin said: “there are decades where nothing happens, and there are weeks where decades happen.” The Covid-19 pandemic seems to be such an event that accelerates history.
The Covid pandemic is hastening the adoption of a number of technologies that were already on the rise:
1. Streaming. Streaming of entertainment on services like Netflix, Hulu and Disney+, were already popular prior to the current crisis but have seen massive increases as we shelter-in-place. This way of consuming entertainment likely will become a habit for many at the expense of other forms of consuming entertainment.
2. Videoconferencing is moving from a rarely-used awkward way of having a meeting to the mainstream. A move to greater use of videoconferencing could have huge effects. According to a report from EYQ which is E&Y’s think tank:
Social distancing is prompting organizations to embrace video conferencing, virtual classrooms and telemedicine at an unprecedented scale. As the crisis continues, it could accelerate development of next-gen remote working technologies, such as augmented and virtual reality. Since these technologies will generate efficiency gains, organizations may retain them beyond the crisis. This process will reshape entire industries and reframe the nature of work and learning. Companies may rethink their real estate strategy and footprint, new collaboration and teamwork models could emerge, and remote learning could redefine education.
3. Digital Payments. I love to use Apple Pay and I love it even more during this crisis. I merely whip out my phone and tap it and I’ve paid — usually without having to touch the payment terminal. The move to digital payments instead of dirty cash or credit/debit cards that need to be sanitized will likely increase as consumers remain germ-conscious in a post-covid world.
4. Online Commerce. According to Accenture the pandemic is accelerating a 25-year old trend: “if I can do it online – I will.” This current boom in online ordering is creating a new way of shopping for many people at the expense of brick and mortar stores. From Accenture: “Already clear is that many users yet to adopt digital fully are now having to. COVID-19 is the catalyst now permanently shifting the laggards online and having made the investment in effort and learned new habits and interfaces, many will not go back.”
5. Remote Working. Bain Capital noted in a 2016 report titled “The Declining Cost of Distance” that “for centuries, the cost of distance has determined where businesses produce and sell, where employers locate jobs and where families choose to live, work, shop and play. What if this cost fell dramatically, thanks to new technologies?”
The current need for much of the workforce to work remotely is normalizing the idea of workers not needing to be physically proximate in order to work together. As stated in The Guardian: “If proximity to one’s job is no longer a significant factor in deciding where to live, for example, then the appeal of the suburbs wanes; we could be heading towards a world in which existing city centers and far-flung ‘new villages’ rise in prominence, while traditional commuter belts fade away.“
The global think tank Chatham House predicts:
Other structural changes to the global economy are likely to include a major and permanent shift to online communication and meetings and working from home, as companies, and particularly small and medium enterprises, and other organizations invest in the necessary equipment and change working methods to suit the services available. This has parallels with response to the ‘Millennium bug’ in the late 1990s, and this, in turn, could lead to reduced demand, or at least slower growth in demand, for office accommodation, public transport and air transport, but an increase in demand for domestic housing.
Trading of Personal Privacy for Health and Safety
Similar to the changes we saw after 9/11, we’re likely to be more than willing to trade our privacy for enhanced health and safety. According to EYQ:
Surveillance technologies including facial recognition and mobile data are being deployed to track those infected and identify those that came into contact with them. Some of these technologies have been under scrutiny due to ethical implications such as privacy, data rights and human autonomy. In the face of an existential crisis, consumers and regulators will likely place less emphasis on these privacy and ethical concerns. Beyond the crisis, it’s possible that this permissive ethical mindset will become entrenched in the new normal.
Likewise, the MIT Technology Review states “we’ll restore the ability to socialize safely by developing more sophisticated ways to identify who is a disease risk and who isn’t, and discriminating—legally—against those who are. We can see harbingers of this in the measures some countries are taking today. Israel is going to use the cell-phone location data with which its intelligence services track terrorists to trace people who’ve been in touch with known carriers of the virus. Singapore does exhaustive contact tracing and publishes detailed data on each known case, all but identifying people by name.”
Increased Demand For and Appreciation of Social Safety Net Measures
Milton Friedman coined the phrase “we’re all Keynesians now” in the 1960s, referring to the tendency to look to the government for support during times of economic distress. Currently, millions of Americans are finding that government benefits such as unemployment are necessities. Chatham House predicts that “Individuals are likely to demand greater social protection and stronger public health systems” in the future. A report in The Atlantic notes, “though Americans tend to have an aversion to ‘big government,’ it’s possible that the relief bill, and other aid passed by Congress, will follow the same trend as past social programs: A reluctant public will not only come to rely on the policies but begin to expect them as a right.“
Many will consider a broader social safety net as a moral imperative as a result of this crisis as the human cost of inequality comes into a clearer focus. While the virus doesn’t discriminate, the divide between the haves and have nots is affecting outcomes. For instance, as of this past Thursday, 12 people in St. Louis had died from COVID-19 and all 12 were black.
Appreciation of Experts
In his excellent book The Death of Expertise: The Campaign against Established Knowledge and Why it Matters, Tom Nichols, a professor at the U.S. Naval War College, notes:
These are dangerous times. Never have so many people had so much access to so much knowledge and yet have been so resistant to learning anything. In the United States and other developed nations, otherwise intelligent people denigrate intellectual achievement and reject the advice of experts.
(BTW: Tom Nichols is great on Twitter, find him here.) We’ve seen the rejection of science and experts with swaths of the American public denying climate change, not believing in evolution, thinking the earth is flat and refusing to vaccinate their kids.
During the current crisis, listening to experts is essential. Both sides of the political spectrum are realizing that there is no substitute for expertise. Some think this could be a turning point for America and usher in a new era where we again value science and experts.
Potential Shift in Consumption Away from Luxuries
Chatham House observes that we may see an increase in personal savings in the future as many see the necessity of having a more robust personal safety net. The current crisis may also shift how we spend and what we spend on. According to Accenture:
When we realize what we can easily live and work without, activities such as long-distance flights or excessive consumption of things that are harmful to the environment will be assessed more closely and, probably, scorned much more. The social pressure to act and live responsibly will grow significantly. In addition, over the months that the pandemic dominates, we are developing new habits and tools that are already allowing us to conduct work and life in more environmentally sustainable ways. In many areas of life, people will be reluctant to go back to the old ways. It will be interesting to see if, among the majority of customers locked down who have been forced to think for many weeks about their priorities, there is an accelerated shift to “conscious consumption”—buying only what matters and what they really need. Will life’s little luxuries rebound fiercely as everyday life resumes? Or will luxury be redefined?
Continued Deglobalization and Supply Chain Changes
Deglobalization began long before the pandemic. Peter Zeihan in his 2016 book The Absent Superpower predicted that the U.S. would withdraw from being the world’s policeman, a role we adopted following WWII. A key reason for our withdrawal according to Zeihan is the amazing boom in domestic oil production has reduced our need to protect foreign oil supplies.
The current crisis will likely accelerate this change as companies reevaluate the fragility of their global supply chains. According to Chatham House, “companies will reshape their supply chains, creating multiple sources of supply and possibly holding reserves of critical materials and equipment. They may also retrench within national markets, the more so if international coordination is perceived to have failed.”
EYQ notes that the pandemic is “revealing how vulnerable global supply chains can be and will motivate companies to rethink their supply chain strategies.” We’ll likely see an increased interest in 3D printing and “reshoring” and diversification of supply chain suppliers. “Specifically, a model in which businesses rely on a single supplier or a handful of suppliers concentrated in one country now appears particularly fragile.”
Similarly, McKinsey predicts that companies redesign their supply chains so that “the pursuit of efficiency gives way to the requirement of resilience—the end of supply-chain globalization, for example if production and sourcing move closer to the end user.” This reshoring of production will continue to spur the move to less globalization.
Interpersonal Relations Will Change
We’ve seen a huge shift in personal relations. As author Mark Manson notes, we’ve gone from FOMO (fear of missing out) to FOGO (fear of going out). We give each other wide berths, no longer shake hands and definitely don’t hug. Anthony Fauci thinks that we should permanently give up hand shaking as a society.
One of the best tweets I’ve seen during the pandemic said “I’m disgusted by my pre-coronavirus self.” Ha. True. These sentiments are fleshed out well in this article: Turns Out We Were Disgusting Before Coronavirus. How we now view contagious disease will likely have a lasting effect on how we interact with each other.
Seeing major cities like NYC suffer from the spread of SARS-Cov-2, we may want to live less densely in the future. Combined with remote working, we may see a shift from densely-packed cities into suburbs.
We’ll change how we view outsiders. The editor-in-chief of the MIT Tech Review predicts that after we re-emerge from our houses after COVID 19 “we’ll emerge into a world in which people give each other wide berths and suspicious looks, where those public venues still in business allow only the thinnest crowds to congregate, and where a system of legal segregation determines who can enter them. Millions will still be out of work and struggling to get by, and people will watch nervously for signs of a new flare-up near them.”