By Andrew Webb, Chief Economist, Grant Thornton
The COVID-19 pandemic has had a devastating impact on our society and economy. As the initial shock of lockdown subsided, a great deal of thinking has been devoted to the type of economy into which we would re-emerge.
The hope as we entered lockdown was that the economy would go into a deep freeze and would pick straight back up from where it left off after the thaw.
While queues of people outside shops that are re-opening after three months gives some sense of consumers willing to splurge after being denied the opportunity to shop, the much hoped for V shape decline and immediate bounce back seems an ever more distant hope.
There is an increasing body of evidence to suggest that some longer lasting damage is being inflicted on our economy and that employment losses will gather pace as Furlough supports end.
Regardless of the path the economy takes, the pandemic and subsequent lockdown have prompted consumers and businesses to make dramatic changes in behaviours and practices.
For example, necessity has greatly accelerated the trend towards online retail that has been evident for some time, and in the business world, expenditure on laptops and other equipment to enable home working was carried out at a pace that would have been unfathomable before the crisis. Some organisations would still be drafting the business case for flexible working if their hand hadn’t been forced.
Organisations have much to consider as the economy starts to emerge from lockdown. That old phrase that can kill business progress stone dead – ‘we’ve always done it this way’ – can surely never be uttered again with any credibility.
Having to try new things at pace and having pushed our technology hard in the way we have, suggests we can give serious thought to implementing more radical ways of working.
Might we see a period of business innovation unleashed? Driving this will be a need for business (and indeed country) resilience and contingency planning to come to the fore like never before. Within this, automation, robotics, and artificial intelligence adoption will, undoubtedly, gather pace.
While automation and ‘industry 4.0’ has been talked about for years, the COVID-19 pandemic has already seen a greater reliance on robots emerge.
Floor scrubbing robots are cleaning the aisles in some US supermarkets, and drones were used by Italian police to enforce social distancing.
Here, there are already examples of local businesses pressing ahead with investments in robotics as a way to ensure a more resilient production line. Automation and robotics are often associated with a drive to replace large swathes of people.
The labour market is definitely set for a period of change, but greater use of automation and robotics could also make it more feasible for Northern Ireland to manufacture more products here, thus building more resilience into businesses through shorter, more localised supply chains.
However the coming months and years go, business has shown a remarkable ability to adapt in recent months. Perhaps that will trigger a mood of innovation and invention.