Out of all the economic shocks, consumer hysteria is the most lethal. Since the global outbreak of coronavirus (Covid-19), the panic and fear among the public throughout the globe is spreading faster than the virus. The impact of Covid-19 is not only limited to the demand side of the market, but the supply chain is also hampered equally.
Throughout history, a pandemic has had a negative impact on business across all levels. The 1918 influenza pandemic also called the Spanish flu had a devastating impact on the businesses across the US and Europe. Although the exact amount of the total loss remains unavailable, researchers estimated that the overall economic loss to US-based businesses revenue was in double digits percentage drop among others. The sectors impacted the worst were service providers and entertainment. In 2020, the coronavirus pandemic has created a similar ripple effect in the global economy, where the total loss from the impact is estimated to be $1Tn.
In India and around the world, the impact of the coronavirus pandemic is not limited to a few sectors but is evident across all stakeholders of the economy. For instance, the venture capital activity in the Indian ecosystem has witnessed a slowdown as social distancing and self-isolation is hampering investor meetings. Similarly, a negative impact is evident across both the white-collar and the blue-collar sector.
With the growing number of cases and rising fear among the public, it would not be pessimistic to say that the worst is yet to come. However, it’s just as important to take stock of the situation right now. DataLabs By Inc42 takes a peek at this brave new reality in its latest release — Business In The Times Of Coronavirus: India And The World.DOWNLOAD YOUR COPY NOW!
Public Markets Flatline Around The Globe
This year, between January 10 and March 16, the six major stock exchanges (FTSE, Nikkei, Sensex, Dow Jones, NYSE and Hang Seng) around the globe witnessed an average 26% (or 6.1K) points decline. Among these, the worst-impacted was the S&P BSE Sensex, which shed 10.2K points resulting in a 25% decline between January 10 and March 16.
The coronavirus outbreak across the countries have hampered both the supply and demand in the local economy as a result of which major industry leaders have lowered their forecasted revenue for the last quarter of FY20. All these factors combined have impacted the investor sentiment in a negative way resulting in a market panic.
With Rising Uncertainty, Investors Choose Gold
When the global economic activity shows signs of uncertainty investors tend to move their investments towards safe havens which in most cases is gold. Since the beginning of this year to March 20, the price of international gold (per ounce) touched its peak at $1,676(adj. closing price). On the other hand, the trade volume of gold (GC=F) touched 9.26 Mn on March 23, which is the highest in one year (since March 24, 2019).
The impact of hysteria is not only limited to the investors and public market but is also evident in the daily operations of businesses in India. A recent media report estimated that the Covid-19 outbreak in India is likely to decrease the hiring of global IT firms in India by 30%. In addition to this, the growing panic in the society along with lockdown being implemented has also resulted in the wage loss for blue-collar labourers in the country.DOWNLOAD YOUR COPY NOW!
Workplace Management Trends That Are Picking Up
In order to keep the operations running, businesses around the globe are adopting preventive measures which keep the physical interaction to a minimum. In accordance with these measures, the following trends have prevailed in the ecosystem.
Online MICE And Remote Workplaces
In the age of digitalisation, it is paramount to collaborate remotely from anywhere at any time. The forced quarantines in many regions will lead to behavioural changes and result in higher adoption of remote working tools in the long term. Companies are encouraging employees to switch to virtual meetings using solutions such as video conferencing and teleworking. In order to continue meetings without disruptions, several companies are exploring technologies such as BYOM, or Bring Your Own Meeting.
Adoption Of Mandatory Sick Leave Policy
Even if the situation returns to normal soon, corporates and startups alike will adopt mandatory sick leave policies covering even minute and common health problems such as flu and fever, which are highly ignored in India especially in the small and midsize business (SMB) segment. Overall adoption of such measures will result in a healthy and clean work environment throughout businesses across the country.
Increased Adoption Of Enterprise Tech In India
With self-isolation becoming the new normal in the fight against Covid-19, the adoption of enterprise tech products is likely to increase and give an impetus to enterprise tech startups in India. These companies originally relied heavily on foreign clients, given the popularity of the traditional style of running businesses – which involved regular meetings in person – in the country.
Of course, these are early days and as people continue to evolve and adapt to their new way of life, we are likely to see numerous other trends emerge in the way business is conducted and in human behaviour. A lot is about to change in a world gripped by the fear of coronavirus. Find out more in our latest release — Business In The Times Of Coronavirus: India And The World.DOWNLOAD YOUR COPY NOW!