What is the impact of COVID-19 on the economy and the workplace?

At the Bankinter Innovation Foundation we have held a series of webinars to learn about the impact of COVID-19 on the workplace and in the different social and economic areas and the opportunities we can find within this situation.

The second webinar in the series, “Impact on the economy and the workplace” has served to unravel the uncertainties and opportunities that the Covid-19 crisis is causing in these areas.

Moderated by Mª Teresa Jiménez, Director of Communication at the Bankinter Innovation Foundation, the experts of the Future Trends Forum, José García-Montalvo, Professor of Economics at the Universitat Pompeu Fabra and Albert Cañigueral, Founder of OuiShare Barcelona, participated in this webinar.

These are the most relevant points of his interventions:

For this expert, the lack of accurate and reliable information makes any prediction in the economic field irrelevant. Quoting the Governor of the Bank of Spain, José comments that the uncertainty is so great that it is very difficult to prepare macroeconomic projections using the usual methodologies.

Based on this premise, José García-Montalvo gave us some keys:

• In the international arena, deglobalization is not on the agenda; It is not positive for anyone and he does not believe that it will happen. There will be, however, a strategic reserve of some essential products. Regarding the role of the European Union, pessimism due to the lack of coordination in all areas.
• Within all the uncertainty, only one thing is clear: public debt will rise drastically and this means that, in our expert’s opinion, young people have a very uncertain job future.
• The pandemic is going to bring economic innovations of the first magnitude: measures that were not contemplated before and that were considered “economic anathemas”: He cited as examples, among others:
  • Negative nominal interest rates.
  • Perpetual debt.
  • The monetary financing of public spending.
• Big tech will increase their power. For the GAFAM (Google, Amazon, Facebook, Apple and Microsoft), the crisis has been a boost. As an example, José referred to the 100,000 new workers that Amazon has hired. Stricter regulation will be necessary, according to our expert, to prevent monopolies.
• Regarding basic income, initially proposed by Milton Friedman, Joséis in favour of it and believes that COVID-19 has accelerated its implementation. Given its complexity, I would be in favour of doing it temporarily in order to improve it later.
• The next economic “shocks” will surely be produced by new pandemics or bioterrorism, so it is necessary to prepare and invest in R+D not only technological, but also medical and economic. In the technological field, José is committed to Machine Learning as a basic modeling and prediction tool, as well as bots for citizen service and mobile tracking apps for tracking and controlling infected people.
• Finally, our expert was hopeful that the pandemic crisis is relegating “fake news”. In the face of such a severe event, citizens look for reliable and verifiable sources.

For his part, Albert Cañigueral, offered us his vision of the business and labor field.

He illustrated the impact of the crisis in these areas with the image of a “digital surprise exam”: the COVID-19 crisis has arrived so quickly and is so strong that there has not been time to prepare. Therefore, it affects the different types of companies in very different ways:

1. Digital platforms are the most prepared. Since innovation and agility are in their DNA, digital platforms have already reacted.
   The main trends of the platforms are the move to digital messaging (such as Cabify), intermediation in more areas (such as Uber with job offers for its associates) or virtual experiences (such as AirBNB).
2. The most digitized companies, which are reacting well. The main trends of this type of company are teleworking, the design of new office spaces to adapt to protection standards, the use of various devices to access remote work and more human relationships.
   Albert believes that these trends are here to stay. As he told us in this interview, teleworking will not be as intense or as massive, but it will change the way we relate to the company.
3. Less digital companies. The trend is towards collaboration and cooperation between them and with the previous two.

With regard to the labour market, the increase in unemployment and the loss of income by groups such as the self-employed and temporary, is increasing the digital divide. Just over 20% of workers can telework, so confinement is seen as a class privilege.

In this environment, collaborative and cooperative initiatives are emerging in all areas of work, from the self-employed to domestic workers.

For Albert, the future lies in digitalization and ecosystems. “The challenges are so great that no one can solve them alone.”