Writing this at the end of a sunny week in June, it’s easy to think that the auto-reset function on our society and economy will kick in and everything will snap back to ‘normal’.
There is traffic on the roads, people are out and about, non-essential shops have opened and we have a timed reopening of our crucial leisure and tourism industry. Still up in the air (literally) is the quarantine issue associated with air travel/travel to further afield destinations. Much pressure is being applied by the travel industry over this and I can only imagine the Foreign Office is trying to negotiate a way around the 2nd highest infection and death rate headline with the countries trying to facilitate a ‘bridge’ to others.
It is certainly hoped and widely talked about that across all economic forums that the end of September will see a re-emergence of our economy as periods of strong spending patterns in July, August and September begin to put us back on the road to recovery. All assuming there is no extension of wave one and a second wave. If and when it does appear, let’s hope it is less damaging than the first because as a nation, we have increased knowledge and understanding of the virus and are therefore better prepared.
Realistically there is very little economic history to fall back on to then try and model a set of outcomes that may or may not happen in this situation. Other than the Black Death or other pandemic/disaster events which are now so historic as to be useless as our economies and societies have changed beyond all recognition since then, or the post-war recoveries of WWI and WWII, which again seem unreliable data models due to changes since 1945, we have very little to go on.
The issue that economists are grappling with in trying to model a future is the interplay between;
- Interest rates
- Inflation (deflation/stagflation)
- Govt spending (stimulation packages)
- Govt revenue-raising (taxation)
- Quantitative Easing (printing money and feeding it into the system)
- Govt borrowing and its credit rating on international monetary markets
- Oh and then don’t forget we have to throw Brexit into the mix as well.
The whole thing, in reality, is a right royal mess with much infighting to be had between the stables of Fiscalists and Moneyterists sat around the table in the cabinet, with the Bank of England and the Office for Budget Responsibility trying to referee the debates and decisions as independents.
Ideologically, this is neither an issue for either the Right or Left of the political system. The current Govt has already thrown away its ideology rule book of market-led economic theories when it revealed its creative package of support options available to see the majority of the population through the darkest of periods any cabinet has had to manage since 1945. No one currently sat around the cabinet table can argue that the market, left to its own devices will develop corrective actions to put us back on track. Equally, arguments surrounding massive and costly Govt intervention and stimulation packages will have to tempered by considerations of costs, Govt debt and continued borrowing requirements.
Either way, there can be no doubt that we have a massive mountain to climb and we need all the ropes, crampons and carabiners we can muster. Chris Giles of the Financial Times in his discussions identified that we had lost eighteen years worth of economic growth in two months, taking us back to the final two quarters of 2002.
Much will depend on the elusive and unquantifiable concept of ‘Confidence’, whether that be within organisations in industries or consumers within households. Spending decisions on investments or non-essential luxury items very much depends on the confidence of the decision-makers in what is happening around them. In a previous blog, I referred to this as the ‘Paradox of Thrift’.
While all this is going on around us, there is very little we can do as we are not in control of the macroeconomic picture. What we are in control of is the micro activity that is within our organisation or within an industry. One thing that is clear is that the decisions we make at this point in time will require very sound and improved knowledge and understanding. Training and Development is therefore of huge importance. Up-skilling your workforce to lead and manage the changes caused by the challenges and challenges of the macro environment.
We don’t have an auto-reset function but there are things that we can do to support our own organisation’s recovery and that of the economy as a whole. The Govt has made it clear that a large part of its post-recovery strategy will be education and up-skilling of our collective workforces to cope with the changes that this pandemic has brought about. We have all quickly learnt how to;
- Work from home and manage our time with blended working schedules
- Use web-based media to meet together
- To read emails in more detail as staff are not in the office to ask
- To engage with all our staff in different ways
- To look after those who are perhaps more vulnerable than we had previously understood
- To engage with our stakeholders at arms length
- To provide safer working environments that are COVID secure
We have learnt so much and there are so many more development opportunities out there that you and your team can use, ranging from TEDTalks on YouTube to material distributed by professional organisations such as CMI.
There are also a huge number of development providers out there, both locally and nationally, some of higher quality than others. Some development opportunities may lead to qualifications, others are simply there to provide information, to support and further develop your knowledge.
As a training and development organisation, we are able to support both formal and informal learning opportunities across both our teams and our soon to be released new website and learning platform provides a great resource for you all to dip in and see what we are up to. What we are providing now is very different from what we did before. Blended learning with online and F2F opportunities have been developed to support all learners across a variety of situations. What is clear throughout all of this is that all our future skill sets need to be highly flexible and creative.
The previously published table above is now even more relevant than before and as an organisation, we are able to support you and your organisation with creating an environment of learning and development. Join us and be part of creating the future for your organisation.