We are only beginning to understand what the business and educational landscape will look like in the post-COVID-19 world. Business and education industries have each gone through seismic changes that may continue to affect them for years to come. Unemployment, business closures, remote work, and remote learning have changed these sectors of the economy. Terrell Strayhorn, a professor at Virginia Union University, explains how these sectors have changed and offers thoughts on how they may be able to recover from the pandemic.
The Impact of COVID-19 on Business
Business closures mandated by both state and federal governments caused a severe derailment of the United States economy. With millions of workers forced to stay home, some people were able to work remotely but others were not. Particularly in hard-hit industries like tourism, retail, restaurants, and airlines, losses (e.g., jobs, revenue) may take years to recover. Unemployment figures in many areas soared to heights not seen since the Great Depression in the 1930s.
Laid-off workers applied for unemployment compensation in droves, quickly overwhelming the outdated database systems used by most states. Unemployment compensation, amid the COVID-19 crisis, has become a key to survival for those laid off from work.
The federal government took action in April 2020 and passed the CARES Act, intended to help laid-off workers and struggling businesses meet their obligations. The CARES Act provided an additional $600 per month to laid-off employees. Business rescue funds were also made available, but the application process and the businesses that actually received this aid—originally intended for bona fide small businesses—received broad criticism.
Airlines and travel-related companies saw their revenues plummet in recent months. With extensive travel bans restricting all but essential travel, the size of the flying public shrunk by 95 percent. Since the airline industry runs on thin margins, they were not able to respond to these challenges quickly.
Another industry severely impacted was oil and gas. People’s driving habits changed immensely in the wake of the pandemic. Auto insurance companies began refunding a portion of their customers’ premiums because the accident rate was so low from a lack of cars on the roads. And many may be familiar with all the recent studies showing a significant decrease in smog and air pollution across the globe.
Going forward after COVID-19, the business landscape will be significantly changed. Many smaller restaurants, firms, and retail shops will close, never to reopen. These businesses cannot keep up with accumulating expenses (e.g., rent, utilities) while they are not patronized by customers. The retail world will forever be changed by the bankruptcy of store chains like JC Penney. The big-box stores like Walmart and Target and online retailers like Amazon will come to dominate the post-COVID world even more than they did before the pandemic.
People’s shopping and dining habits may have also changed permanently. There will be fewer places to shop in person, and more people may turn to online shopping as a primary way to get the things they need. Where dining is concerned, restaurants that have been able to pivot quickly with take-out, mobile app ordering, and curbside pickup may survive, but even these restaurants may be facing an uphill battle.
After COVID-19, it is thought that customers will be cautious about returning to restaurants and retail businesses. People may not be willing to pack crowded bars and clubs like they were in the past. The current reopening of some states may show whether or not the decrease in social distancing will cause the virus to resurge, necessitating further closures. (And despite my philosophical alignment with the underlying values driving protests all across the country [at the time of this writing] expressing outrage about the shameful killing of George Floyd in Minnesota, I do worry what the effects of large masses assembling in collective action will mean for coronavirus numbers in weeks to come.)
One bright spot in business is the grocery industry. People have not been eating out as much since the pandemic started, and people are spending more at the grocery store. The grocery industry is one of the only areas that has experienced growth during the COVID period. It is likely that they will continue to do excellent business post-COVID19, even as they let some of their temporary workforce go.
Another area of daily life that has experienced a severe upheaval in the pandemic is education. From K-12 schools to universities, schools have been closed and the educational system has moved to a distance learning model. Students are being homeschooled by their parents who are often trying to complete their work-at-home assignments at the same time. This leads to a high level of stress for many families.
Not everyone has the same access to high-speed internet and computing devices, so there is a significant socioeconomic gap in remote learning. Remember, the nation had a digital divide long before COVID-19 even had a name. This gap may exacerbate achievement gaps between lower-income and rural school districts compared to schools in higher-income urban and suburban areas. Without intervention, growing gaps could affect the students’ educational and professional futures, causing them to score lower on high stakes standardized tests and jeopardizing their chances of getting into a good college. This is especially true of high school underclassmen who only have a few years to cement their academic future. For lack of college access, these COVID-19 impacted students, turned future graduates, are likely to face limited career options as a large number of high-paying jobs require at least a bachelor’s degree.
Going forward, it is possible that schools will not be able to return fully to in-person learning models in the Fall. Plans and emerging best practices are being developed now that will help schools and universities make their facilities safe. Many teachers and parents are concerned that social distancing will be next to impossible, especially in the younger grades.
Colleges and universities are losing a great deal of revenue during this time, and some colleges with smaller endowments may be forced to close, as discussed elsewhere. This contraction in the college and university system may lead to new challenges (and opportunities) for the remaining schools. Only time will tell.
A Lasting Impact
Whatever happens in the business and educational spheres after COVID-19 has passed by, the world will be changed permanently. It is possible that we will be able to return to a version of our pre-COVID “normal,” but it is much more likely that we’ll pull together, while staying physically apart for a while, to create our new normal. Businesses and educational institutions alike need to establish flexible operations and systems to cope with the disruptions caused by COVID-19. Terrell Strayhorn has hope that the systems will be able to rebound, and that the world will be able to move forward once more, better, stronger, and united.