What Comes Next? COVID-19 Facts and Their Implications
As I pen this article, we’re in the first full week of May 2020. The question on everyone’s mind right now is, “What comes next?” In their conversations, many people use phrases like “return to normal,” “end of lockdown,” and “emerge from the pandemic”—as if we’ve reached some sort of COVID-19 finish line.
Unfortunately, nothing could be further from the truth. At best, we are merely approaching the end of the most current phase. And we don’t know what the next phase will look like or how long will it last. Before we can get a handle on those things, we must first understand where we are now.
Key Facts About the Coronavirus Pandemic
So, let’s take stock of some key facts known to be true as of today. For the purpose of brevity, I have focused on a handful of categories:
- Economics and Employment
- Consumer Behavior and Human Psychology
- COVID-19 Mortality and Morbidity
- Vaccine Development
I. Economics and Employment
- In mid-April 2020, the employment rate was approximately 56 percent among working-age adults. Among those still employed, 42 percent had experienced a drop in their earnings.
- Between 30-34 million Americans have lost their jobs.
- Approximately 4.17 million mortgage loans are currently in forbearance.
- Seventy-two percent of all surveyed U.S. small business owners (90 percent of whom had 20 or fewer employees) believe that the COVID-19 outbreak will have a permanent impact upon the way they run their businesses.
- The worldwide impact of COVID-19 has been far-reaching, affecting many industries and business sectors.
II. Consumer Behavior and Human Psychology
- On average, it takes 66 days for a new habit to become ingrained with someone.
- Worldwide, consumer spending has substantially changed.
- Post-lockdown consumer behavior in China remains altered.
- As of April 16, 2020, 57 percent of Americans are concerned about the health effects of COVID-19.
III. COVID-19 Mortality and Morbidity
- Approximately 71,000 U.S. citizens have died from COVID-19.
- The current case-fatality rate for the U.S. is 5.8 percent.
- On average, COVID-19 kills its victims a full decade before “their time.”
- COVID-19 is highly infectious, and R0 (pronounced “R-naught”) is used to assess the rate of infection. (You may be interested in reading this early release of the pending CDC paper High Contagiousness and Rapid Spread of Severe Acute Respiratory Syndrome Coronavirus 2).
- “Herd immunity” is dependent upon R0. The exact percentage of citizens required to achieve herd immunity is contingent upon that number.
IV. Vaccine Development
- On average, it takes 10 to 15 years to develop a new vaccine.
- The fastest vaccine ever developed took four years.
- Ninety-seven different COVID-19 vaccines are currently under development or being explored.
- How long will it take to develop an effective COVID-19 vaccine? Check out this detailed analysis that allows you to model different vaccine development timelines based on changing factors and circumstances.
The above facts are as Donald Rumsfeld might say, “known knowns.” They are subject to change contingent upon “unknown unknowns” becoming illuminated in the future. I encourage you to consider the implications of these facts within the context of your own experience and draw your own conclusions.
Questions to ask yourself include:
- What effect will continued infections (and increased deaths) have upon the economy?
- What does it mean if a vaccine will not be available until late 2021 or beyond?
- What impact will the past 60 days have upon consumer behavior?
- What impact does a high level of uncertainty have upon leaders’ ability to make effective decisions? (Within both the private and public sectors)
- How will individuals and organizations handle the increasingly complex and fluid amount of information about our ongoing situation?
It’s unfair for me to toss questions out without sharing my thoughts. So, here are a few of my personal takeaways about the shape of things to come between now and September 1, 2020, and thereafter.
- Consumer behavior has been modified by our current situation and will largely remain self-modified until a vaccine is widely available.
This means it’s likely that:
- Consumers will not rush back to dine-in at restaurants. Restaurants without takeout service will probably not survive to see 2021.
- Vacation, pleasure travel, and large-scale entertainment activities will be severely curtailed. This means major losses in and massive disruption of the companies within those industries, their suppliers, and affiliated industries. Many of those organizations will not survive.
- Critical retail (e.g., grocery stores, Costco, Target, etc.) will continue to operate within recently established safety parameters. They will likely expand their reach through enhanced consumer services.
- The success and continued viability of B2C businesses will become highly dependent upon not only WHAT services or products they provide but also WHO they serve. The degree to which overall economic conditions impact the demographics they serve will dictate how well those businesses can weather this storm.
- Changing consumer expectations and behaviors will drive further changes in business far beyond B2C.
All businesses are made up of individuals who are also consumers. For example, Amazon’s “one-click” ordering and vastly improved online experiences reshaped consumer expectations. That, in turn, drove changes in the B2B market. Be on the lookout during the coming months for changes in the business world that are driven by changes in the consumer world.
- A steady rate of new infections and deaths will be punctuated by regional “spikes.”
As a result, we will see:
- Rolling, limited closures dependent upon specific circumstances geographically.
- “Spot” closures of highly infected businesses with reopening contingent upon disinfection.
This set of circumstances will inject a high level of uncertainty into the business environment. Organizations that have engaged in scenario planning and are nimble will be best positioned to ride this wave.
- The amount of available information regarding the entirety of our situation is voluminous, complex, and fluid.
Consequently, I expect many citizens to suffer from information overload and situational fatigue.
- Gravitation toward simple explanations and a general sense of feeling overwhelmed by the situation.
- Default to binary thinking; instead of many possibilities, people will see only two.
- High level of distrust and suspicion among citizens with different beliefs about our shared reality. This will exacerbate polarization across communities. And, it will result in the continued politicization of our health and economic situation as well as disagreement over future courses of action.
- Optimism bias—such as the belief that a cure will magically appear or that the infection will simply fade away—will prevent many individuals and organizations from engaging in realistic planning.
I have many more (industry-specific) thoughts that I’ve been sharing with my clients and members. Those thoughts are too voluminous to list here. I hope that centralizing a few key facts and providing you with a few prompts in the form of questions will help you to expand your thinking.
Reach out to me if you’d like to dive deeper into this complex and impactful topic. In the meantime—stay well, stay informed, and remain hopeful!