AND AS FOR THE RICH... THEY WILL GET RICHER!
WHAT kind of world will we return to after Covid-19?
Alas, as ever, it will be world where the rich will continue to get richer – and the poor poorer.
Companies that employ most of our people in the private sector (travel, tourism, retail and hospitality) where you used to get a friendly interaction and decent service, are devastated.
But amidst the economic carnage, companies that pay hardly any tax, employ relatively few people worldwide and avoid personal contact, are making even more astronomical profits – and the billionaires who own them are set to become trillionaires, partly thanks to Covid-19.
It seems crazy that a virus that will hopefully soon go away may permanently destroy hundreds of thousands of jobs.
But it has levered open preexisting cracks into an unbridgeable abyss for some firms in our retail and hospitality industries.
We stopped making our own stuff years ago and import much of it from Asia. This started a transfer of wealth from West to East, which will accelerate as we start buying even more stuff online and do so directly from the East – cutting out shops here.
Pre-Covid, we regularly shopped in stores employing 285,000 people. Many of those shops were in trouble anyway due to the shift to online purchasing – and that has been cruelly accelerated by the lockdown.
Maybe we will all go back to these stores as much as ever, but retail experts think otherwise and up to 40% of shops in Britain are expected to close in the long run in the shift to online buying, which is compellingly cheaper.
The tourist industry was also vulnerable to any international scare. The 325,000 people who work in this sector will be impacted long term as travellers on flights were exposed as a key spreader of Covid-19. Tourists will return but not in a hurry.
The Economist predicts ‘a lost decade’ for millions of workers who were already on low wages.
Yet those making big bucks – pharmaceutical and digital firms and their highly paid staff – are doing well amidst the carnage. ‘Big Pharma’ is going into overdrive –
understandably – and their profits are soaring (see main piece).
So too are digital giants. Even as his workers protest about poor safety standards over Covid-19 at Amazon, the lockdown is helping to make owner Jeff Bezos the world’s first trillionaire – that’s a one with 12 zeros – by 2026, according to Comarisun.com.
Bezos has been raking it during the pandemic – adding $28bn to his $143bn fortune.
Amazon has been criticised for paying only a small amount of tax in relation to the scale of its business in countries where it operates, and recently it came under fire for closing a fraud helpline.
But its service has been a boon for families under lockdown and it is to create 100,000 jobs in a global €300bn investment plan to meet the surge in demand due to Covid19. In March, it advertised for customer service workers in Ireland to work from home. The pay is just €12 an hour but there are pension and health benefits that most firms don’t offer at this level of income.
Netflix, another US tech stock, is also doing well, as people stuck indoors turn to its online streaming service.
Shares jumped 30 per cent since the start of the year and founder Reed Hastings’ estimated wealth has jumped from $4bn to around $5bn.
Due to the crisis, millions of us have become devotees of Chinese-American businessman Eric Yuan’s video conferencing service, Zoom.
The 50-year-old founded it in 2011 and owns around a fifth of the firm, whose shares have rocketed by more than 100 per cent this year.
With that rise, Yuan’s fortune has surged from $3.5bn to
€8bn, according to Bloomberg.
Married with three children, he was inspired to seek work in Silicon Valley in 1994 after hearing a speech by Microsoft founder Bill Gates, but was denied a visa eight times by American authorities.
These guys have more than enough money already, while local businesses are suffering like never before.
They are the ones who need – and deserve – our support far more than billionaires like Jeff Bezos.