With almost no Covid in Australia now and job keeper finishing, it’s a good time to reflect on the last 12 months and where we go from here. On the back of a pandemic what has stood out to me most is the good nature of people and the caring society in which we live. Members of society isolated and wore masks, business owners closed restaurants we scanned into venues all in the name if eradicating the virus, and we did just that. Before the pandemic could you have believed that society could have banded together in such a way. Now there is a general feeling, in Australia at least, that we have reached the end of the pandemic and can move on albeit with immense caution should this virus ever find a way to reinvent itself.
So where to now? How do we get back to normal, and what is normal? Most writers are saying that the past 12 months has had the impact of changing society forever, but has it really? Following I will give my perspective.
When the virus was initially discovered the impact was completely unknown. Business lost certainty overnight about their customers base and how it might impact them. We were running “what if” scenarios around what would happen if we lost 30%, 50% or 70% of our customers. How would we scale down? How would we address a wage bill we could not afford? Most businesses sent their people home to work which was a major achievement in itself. Hundreds of mini workplaces were established so what were the workplace health and safety impacts. Job keeper was introduced which provided businesses a lifeline, the confidence to move forward and not react too quickly. This provided opportunity to retain staff, possibly on reduced hours and staff kept their jobs. Job keeper did what it was meant to do.
The next 3 months became very interesting. Not all businesses found that their business disappeared. Many actually benefitted and found that the pandemic had a positive impact on their turnover. If you were a restaurant, supplier to restaurants, or in the travel and entertainment industry you suffered badly and bore the worst, but if you supplied a product or service consumed while at home, like hardware for house renovations, you benefitted.
The end of job keeper may mean the end for many of those businesses where their customer base has still not returned. This has been the most tragic part of the pandemic and hats off to all those business owners who have battled through. Your resilience is a virtue.
But for all those businesses who have done it tough, many have thrived. People had more time at home so DIY and home entertainment became a thing. Grocery stores thrived as people could not go out to eat. When the lockdowns were over and overseas travel not available, we got out and visited country towns and it was often difficult to find a hotel. People are rediscovering Australia, and from my own experience of overseas travel, whilst there are many wonderful locations, Australia has it all in terms of variety and natural beauty. There are many sleepy towns with great atmospheres that you can just hide away in and relax.
All that being said, what will be the impact on the economy? I am not an economist by any means, but this is what I am seeing.
- a move to localised travel and entertainment. Whilst this is at the expense of overseas travellers these will return at some point,
- the end of job keeper will spell the end for many small businesses in industries particularly impacted by Covid. Many of these were struggling before Covid and they have been unable to sustain many setbacks during the pandemic.
- Decentralisation – Businesses and people have realised that staff can work from home so there will be much more flexibility in the workplace. There are signs people are choosing to leave cities which is seeing a housing boom in country areas.
- Housing shortages are leading to a housing boom. Auction clearance rates are at a high and price expectations are being exceeded.
- Lifestyle Changes – the pandemic has impacted people’s outlook on life, and this will impact lifestyles. More time at home and spending more time with families has reminded us that regardless of everything else you family is there for you.
With all these changes and a new housing boom, the outlook for society looks very different. Within all of this there are many new opportunities that will emerge as entrepreneurs take a view on the new society and the new way of living. I believe many new products and services will emerge in the next 5 years in response to all the changes.
Similarly, many existing products will be discontinued as society moves on. If you look back over the past 100 years, every time there is a downturn, a boom period follows. With the pandemic, the downturn this time will impact a few specific sectors heavily, but the changes during this period will result in a boom period to come in the next 5 years.
I believe we are about to go through a period of change so the lesson to be learned is to look for the opportunity. There are likely to be changes in the way people live, so there will be opportunities for new products and services and opportunities to broaden product ranges. Business will need to have their Strategic radar on to recognise these opportunities.
On the other side of the ledger, there will be products and services that are no longer required, or people will use less of. This is not a time to assume current demand will continue. Businesses will need to read the signs, be able to pivot and adjust to new trends.
There is no doubt that what is ahead will be exciting and challenging and a period of change. All I can say is be ready!