Shift in economic landscape
Changes that were brought about during the pandemic may stay after the crisis ends
NEW YORK — It would be just a temporary precaution.
When the viral pandemic erupted in March, employees of the small insurance firm Thimble fled their Manhattan offices. CEOJayBregmanplannedtocallthemback when NewYork was safe again.
Within weeks, he’d changed his mind, brokeThimble’s lease andtoldhis twodozen staffers to keepworkingfromhome— possibly for good.
Bregmannowsavesmoneyonrentandno longer has to persuade recruits to relocate to an expensive city.
“I was very skeptical at first that we could conduct business this way for a long time,” Bregman said. But having employees work fromhomeproveda“hugebenefit” for everyone.
The pandemic has upended economies worldwide — transforming how people work, travel, eat, shop and entertain themselves. It has widened a gap between affluent white-collar employees who can work fromhomeandthelower-wageworkerswho can’t.
“We’re not going back to the same economy,” Federal Reserve Chair Jerome Powell said last month “We’re recovering, but to a different economy.”
Evenso, economists say it’s unclear which changes will last. Will office workers yearn for their old cubicles andface-to-face contact with friends and colleagues? Will foodies return to fashionable restaurants? Will audiences once again gather for Hollywood blockbusters and Broadway musicals?
Some predict that old ways will return. China, whichmostlycontainedthevirusand became the first major economy to emerge from the pandemic, saw normal life reassert itself withsurprising speed. People returned to restaurants, shops and cinemas.
Companies and workers have spent months weighing the pros and cons of remote work.
Thimble’s headofproduct, MitchKushinsky, enjoys the flexibility of workingathome. He doesn’t miss the commute downtown from the Upper West Side.
Sometimes, though, he misses mingling with co-workers. “You learn a lot just being around people,” Kushinsky said.
AMcKinseysurveyof800corporateexecutives worldwide found that 38% expect their employees now working remotely to continue to do so at least two days a week after the pandemic, up from 22% in surveys before the pandemic.
The shift has far-reaching implications. Emptier cities are a threat to downtown restaurants and retailers and to municipal governments trying to collect taxes.
Thepandemichaswreckedtherestaurant industry — and some scars will likely linger.
In pre-pandemic days, Brenda’s French Soul FoodindowntownSanFranciscodrew crowdswithits beignets andotherSouthern foods. When San Francisco banned indoor dining March16, its 150employeessuddenly were jobless.
The National Restaurant Association estimates that one in six U.S. restaurants — morethan100,000— haveclosed. Manythat stayed open shifted to takeout and delivery, but need fewer staff.
Governmentaidhelpedsmaller, independent restaurants initially. But that money is long gone. After an anemic holiday season, the industry could see another big wave of closures early in 2021.