Today’s audit firms face an unprecedented challenge. How to balance clients’ needs, worker safety, and personal liability in the face of coronavirus? As the country begins to reopen, amid a surge in coronavirus cases, that decision seems more impossible than ever. In talking to our clients, we’ve heard some of the pros and cons of getting back to work and returning to the office. And we’d like to take this opportunity to share our thoughts and foster dialogue as part of the audit community. It feels hard because it is To reopen or not to reopen? It’s the question on…
Now What? What History Can Teach Us About How to Restart the Economy, Post-Pandemic
By now, we’ve heard it so often that it’s practically the mantra for 2020: we’re living in unprecedented times. In just a few months, the novel coronavirus changed how we think of everything from workspaces to birthday parties. It triggered sweeping stay-at-home orders, brought back home baking, and may have permanently changed how we think about remote workers. It also brought many aspects of the global economy to a grinding and painful halt. Now, as we take the first steps to restart the economy, many are looking to the past for guidance. By looking back at the 1918 Spanish Flu pandemic in particular, we can map out predictions for how things will look as we move forward.
As you read on you’ll find:
- An overview of the coronavirus’s impact on a regional, national, and global scale
- A comparison between the Spanish Flu and the current pandemic
- An evaluation of the advantages we have in the modern era
- Predictions about the potential obstacles and opportunities we face as we move towards economic reopenings
Has coronavirus shut down the global economy?
In some respects, yes. But experts believe that could be a good thing.
Since the first reported cases in December 2019, the novel coronavirus has spread to 185 countries. To date, over 10 million cases have been confirmed worldwide. As case numbers began to rise across the United States and Europe, we saw the world enact widespread and aggressive preventative measures. From strict stay-at-home orders to shuttering businesses and high-risk events like concerts and expos, the International Monetary Fund has deemed these restrictions “The Great Lockdown.”
Globally, financial markets reacted pessimistically, behaving in ways eerily similar to the 2008 financial crisis. As analysts noted in an April 2020 article by Foreign Policy, “Doubts about pre-coronavirus global supply chains, the safety of international travel, and, at the national level, concerns about self-sufficiency in necessities and resilience are all likely to persist.”
Rising unemployment rates, interrupted global supply chains, and mass shortages don’t sound very positive. But beneath the surface, these issues are spurring real, widespread change. The global crisis has forced us to look at the flaws and shortcomings of the global system and redesign to enhance resilience. It has also forced us to ask the question: what now? Because suddenly, business-as-usual is no longer an option.
What history can teach us about how to restart the economy
Those who don’t learn from history are doomed to repeat it. And while it’s true, we never have experienced anything quite as widespread—or as enduring—as the coronavirus, there’s still plenty to be gleaned from past health and economic crises. Historians point to the 1918 flu pandemic as a model for how to restart the economy in the face of COVID.
‘Spanish Flu’: understanding the 1918 pandemic
Almost exactly a century ago, another respiratory virus tore across the world. And it left devastation in its wake. The 1918 flu pandemic, commonly known as the Spanish Flu, was the most severe in recent history. Much deadlier than COVID-19, it killed millions around the world in a matter of months. Likely exacerbated by World War I troops’ movement, it swept through barracks, fox holes, and urban centers. Unlike COVID-19, the most likely to die were young economic drivers—people in their 20s and 30s.
Then, much like now, the first line of defense was social distancing. Schools were closed, church services canceled, and mass gatherings banned. Cities rolled out massive ad campaigns encouraging people to wear masks, stop spitting in the streets, and wash their hands. Because social distancing was the most effective response, similar concerns for industry and the economy were front-of-mind for many. And yet, the U.S. economy emerged with many industries relatively unscathed.
What’s the lesson here?
There are plenty of crucial differences between now and then. For one, America was in the middle of the first World War when the Spanish Flu outbreak began. As Vox outlines, that meant “Work in factories, mines, and shipyards continued, despite at least some of this work facilitating the spread of the disease. Why? Because businesses were under pressure by the U.S. government to fulfill the demand for products and commodities that were needed for the war effort.”
Surprising, perhaps, that it took a world war to save the U.S. economy. And while we can’t (and shouldn’t want to) replicate the conditions of 1918, there are plenty of lessons we can learn about the value of playing things safe. Namely, appreciating the effectiveness of social distancing measures.
Lesson: social distancing is essential. Yes, even when we’re tired of it.
Not only does the 1918 flu pandemic show the efficacy of social distancing and proper hygiene. It also shows the consequences of reopening too soon.
As the Great War raged on, Philadelphia city officials organized a parade to raise morale and inspire unity. According to the Smithsonian, over 200,000 people lined the streets to cheer on the marching bands, Boy Scouts, women’s auxiliaries, and uniformed troops that stretched nearly two miles. And the consequences were severe. The Smithsonian archive shows that “[w]ithin 72 hours of the parade, every bed in Philadelphia’s 31 hospitals was filled. In the week ending October 5, some 2,600 people in Philadelphia had died from the Flu or its complications. A week later, that number rose to more than 4,500.”
In an attempt to slow the spread, officials closed down the city. But the reactive containment efforts came too late. This event would become exemplary of what not to do during a pandemic. It triggered a second wave even more deadly than the first.
Restarting the economy in the digital age
So, we’re a nation that’s standing at a crossroads. Rising unemployment numbers and financial insecurity have many corporate and business leaders anxious to get back to work. But state officials feel like they’re playing an impossible game—balancing their citizen’s lives and their livelihoods.
Luckily, the modern workforce is digitally empowered. We’ve got greater remote and virtual capabilities than ever before. And we posit that this will be our greatest strength in any viable bid to restart the economy. Of course, this will require us to be flexible, innovative, and courageous as we navigate an entirely new set of social and economic challenges.
The role of virtual teams
The data from 1918 shows that cities that closed down earlier and stayed locked down longer bounced back more effectively once the pandemic ended. As Harvard professor, Scott Duke Kominers, notes, “To be clear, the finding that cities that practiced stricter social distancing did better post-pandemic doesn’t mean those places didn’t suffer economically. They did. But on balance, the distancing measures appear to have reduced the pandemic’s economic toll.”
But what if virtual teams mean we could have our cake and eat it too? In other words, shut down our cities while still helping American workers get back to work? By hiring digital and remote workers, we can maintain aggressive social distancing and protective measures, while still taking care of business—literally and figuratively.
As a tech-forward company, Makosi has spent years building and empowering digital teams around the globe. We’ve found that virtual teams benefit everyone involved. Our clients get the intellectual output of the world’s best and brightest minds. Remote work also levels the playing field, allowing disadvantaged workers the tools to compete in the professional landscape.
And some experts believe the decentralization of virtual teams makes work systems more resilient in general. “People are talking about how this is going to be the fourth industrial revolution with different technologies changing fundamentally how we work,” said Jennifer Christie, an H.R. representative for Twitter, in a recent Coindesk article.
Predictions: things will be unpredictable as we restart the economy. Virtual teams can help.
Regardless of when, where, or how the U.S. economy returns to work, one thing has been made abundantly clear in recent months. The coronavirus has brought systemic imbalances to light. As Fortune notes in their historical analysis of the current crisis, “This pandemic has highlighted the economic insecurity of millions. But if the past is a guide, social reforms could follow.” And we predict that remote and virtual capabilities will play a massive role in that reformation.
Despite the uncertainty of the current global situation, there’s good reason to stay optimistic. By tapping into the lessons of the 1918 Spanish Flu pandemic, we know that social distancing works. In the meantime, virtual and remote workers quietly power the U.S. economy from their couches, kitchen tables, and home offices. And when it is time to restart the economy, Makosi hopes the country remembers the power and potential of virtual-first teams, and the advantage they give us now versus then.