Arthur W. Page Society

Hot Topics: The economic impact of COVID-19

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As companies are sharing their quarterly earning calls we begin to get a clearer picture of what the economic impact of stay at home orders and travel bans will be. Page held a member call on this topic, led by Scott Kronick, Chief Executive, PR & Influence - Asia at Ogilvy Asia Pacific. Here are some takeaways from the member discussion:

  1. Forecasted historic declines across Asia-Pacific.
    Hopes for a U-shaped recovery all hinge on the virus not re-emerging and consumer activity returning. While many companies have taken financial hits, their costs are also down. Some sectors of the economy have been cut out entirely. For example, media companies that rely on advertising and sports as profit centers are furloughing workers, even as news is rising in importance. Businesses are diversifying their supply chain, as COVID-19 has revealed this should be part of crisis planning. In fact, nationalizing the supply chain could become more important than reducing costs.
  2. When is the right time to return to work? 
    What are the milestones to bring people back to work? The key issue is going to be testing. There are important lessons from Taiwan and South Korea, both of whose responses were shaped by their previous experience with SARS. In both, the primary focus was on mandatory testing, less about working from home. Taiwan banned travel to China, stopped cruise lines, instituted punishment for quarantine violators. Both have kept the economic and public health impact relatively low. 

    In contrast, although Singapore got ahead of the virus very quickly, they are now back in lockdown after failing to take into account the potential for the spread of the disease in the foreign worker dormitories. The lesson: Keep your radar on and plan for the worst.
  3. Does return to work mean a return to travel?
    Travel has all but disappeared. How long will this last? Looking to SARS for a guide, within a year people were traveling the same as before. While remote meetings are becoming more acceptable than ever, some in the discussion expect a quick to return to business travel.
  4. Increased focus on CSR?
    We’re seeing new expectations – especially for large companies – to increase their societal commitment, and specifically to align their Corporate Social Responsibility programs with local/national needs.
  5. COVID-19 leading to ageism?
    As a phased approach to reopening economies begins to take shape, the more vulnerable populations are beginning to feel left out. In some countries with an older population, this poses big questions about how to manage multi-generational workplaces.

Special thanks to moderator Scott Kronick for leading this discussion and Andrew Thomas, Simon Webb, Selina Teng and Paul Edwards for their perspectives.

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