You may have heard that the world economy is set to collapse seriously from multiple sources until date. The economy has already depleted severely and is set to deplete further. But by this pandemic Is the economy actually collapsing or Is it just going to change its face the way we understand economy today.
Economy is like a vast interconnected social network. The world economy is an infinitely complicated web of interconnections. We each have a series of direct economic relationships we can see: the stores we buy from, the employer that pays our salary, the bank that makes us a home loan. But once you get two or three levels out, it’s really impossible to know with any confidence how those connections work. Have you ever wondered what happens when that web is torn apart when millions of those links are destroyed all at once? Sounds Scary right
If we see carefully the economy is going to affect a large number of enterprises especially those that involve huge manpower and those who cannot work online or work from home. For instance sectors like manufacturing of non-essential goods. But Instead, the COVID-19 crisis seems poised to accelerate or intensify many economic and metropolitan trends that were already underway, with huge implications of their own. While it seems natural to assume that virtually every industry will be humbled by COVID-19, it sure seems to me that the big tech titans—Amazon, Facebook, Google, Microsoft, Apple, Netflix, etc.—will emerge from the crisis stronger than ever. These titans captured dominant market shares in the decade following the last recession. Now, I bet the digital rich will get richer, as stay-at-home workers rely on their remote work tools, video calling, e-commerce, and video streaming.
The crisis is in fact an exceptional opportunity for those who are already in these businesses or businesses that are more or less online leading to a drastic increase in the demand. Business or people in such fields have greater opportunity also because of intensive decline in competition. Such business that works ten times of the work that they used to do earlier is intended to grow exponentially post the lockdown phases. Innovation and hybridization in food and retail is set to expand. As the use of digital booking, digital payments will soon become almost non-avoidable.
Real issue is being faced by low wage workers. Daily wage workers are already suffering severely due to stoppage of income. Although governments all around the world, as well as social and religious organizations, are helping to their highest extent. The issue lies in the fact that maximum daily wage workers work at construction sites. Once the lockdown is removed the issue retains that house development works and construction works are not projected to revive over the next two years. This concern needs to be addressed as the government will not be able to support all construction workers for such a long period with tax collections already depleting.
It would be foolish, amid such uncertainty, to make overly confident predictions about how the world economic order will look in five years, or even in five months. But It is clear that the world that emerges from the crisis will be transformed, yes, but also recognizable—for better or worse.