We know: the pandemic is transforming the global economy. In production terms, safety is becoming almost more important than efficiency. What will be the next changes?
The coronavirus isn't going away anytime soon. Hopes of a return to normality are vain, misleading. Awareness of the dangers will also change our habits and the future of the economy.
Social distancing will continue to guide our interactions, restaurants will change their face, open space offices will be partitioned and much less will go by elevator. Companies are trying to make themselves more resistant to sudden economic shocks, resilience will be the new guiding principle.
Industrial machine manufacturers have started shifting priorities from making the supply chain as cheap as possible to making it as secure as possible. Salespeople have used video chats instead of traveling around the world. The Zoom video conferencing platform today it is listed as the 7 major airlines in the world.
For months, perhaps for years, the States will resume a role of guidance, or at least of direction, also for the industrial economy. They will have to face the pandemic, reduce its economic consequences and support the restart. Give emergency aid, low-cost loans, economic incentives. Guarantee a minimum wage, and fight speculation. A titanic task.
Welcome to Earth in the 20s
A world in which security and governments will be central. Some people think that many things will change for the better, that by slowing down the economy and increasing the principles of solidarity, society will be better. Someone else thinks that people never learn from catastrophes, proof of which is the first speculations on healthcare products and bank loans.
However you see it, this crisis gives us no alternative: we must trace different paths from the past. Global trends, after all, are what have somehow produced this state of affairs. Mobility, excessive urbanization, environmental devastation: we must put all this on trial to build the future of the economy.
What will be the sentences?
Globalization and public debt are the main defendants. Two elements whose persistence will limit society's choices for years, perhaps decades, to come. Technology will play an even more important role, hoping that abuse will be replaced by a culture of its good use. Actually we need to build a healthy relationship with technology, it's not a question of quantity: we don't currently abuse technology. We are abused by technology, it's different.
Internalization
Those who were left behind in terms of globalization, keeping their production cycle within the company as much as possible, have suffered less from the effects of the pandemic and are preparing for a faster recovery. Being able to count on a local supply chain rather than relying on production distributed on a global scale is a key factor in this period.
Safety
In addition to the need to make ourselves "impermeable" from the crisis that can arise from excessive outsourcing, security is also fundamental for the supply chain. At the moment, its pre-eminence over price is total: both companies and customers know that it is better to have things that are a little cheaper, as long as they are safer. Another blow to globalization, with the need to have the supply chain under control and not take parts from the other side of the planet to be assembled thousands of kilometers away.
Companies that have a habit of producing only 5% internally (for example, Adidas) are preparing to face a period of intense storm.
The perception gained from this pandemic is profoundly transformative for forty-year-olds, the category to which I belong. People like me, despite growing up in a "two-block" planet, have experienced a constant process of globalization and opening of borders since the fall of communism.
Today we are witnessing a profound turnaround, imagined even before implemented.
Accumulate stocks
In lean times, putting hay on the farm is the primary instinct. But the world economy had been going in the opposite direction for some time, causing capital to circulate very rapidly. Flexibility, agility, no warehouses, production on demand, or as they say "just in time". It was a dream for many, today it is a nightmare (Bianca Stancu spoke about it masterfully in this post on Futuroprossimo a few weeks ago). Warehouses are about to come back into fashion.
The effects
Internalizing again will increase safety and also prices, reducing profit margins. And how will the production system limit the damage? Probably with strong automation. Another probable protagonist in the future of the economy.
Industrial robots perform all types of jobs that were previously occupied by workers. Before the pandemic, the industry was preparing for the great leap in deep customization, creating completely customized products (even cars) at mass-produced prices.
Robots can be used all day, they don't get sick and they don't have to go on vacation. They must not respect any social distancing. In short, they allow production to continue.
In short, the future of the economy
De-globalization, high automation, localization pushed, state support for citizens left without work, incentive for the movement of knowledge and the conversion of working skills, digitalization of processes.
