The Economy Under COVID-19: Notes From the Trenches

There are currently two crises underway simultaneously. The advance of the novel coronavirus is taking a terrible toll in terms of physical and emotional well-being. At the same time, job losses resulting from ‘social distancing’ are sending the economy into a tailspin. To fight on both fronts, governments are advancing rescue packages of never-seen-before dimensions. Every day, the tremendous number of factors in play reconfigure in a new way. These ‘from the trenches’ notes attempt to shed some light along a murky pathway.

Nothing says ‘social distancing’ like robotics. One reaction to the international supply chain interruptions that have been caused by the spread of the coronavirus will be a move towards de-globalization of manufacturing. This won’t necessarily be of huge benefit to domestic labor, however. An already intensive and expanding usage of machine labor on production lines will be given an additional shot of adrenaline.

Machines will also be doing more of the ‘grunt’ work in other segments of the economy. Warehouse operations to support online retail sales will increasingly go the robotics route, as will the outdoor and/or underground extraction activities of resource sector firms. Nor will construction be left out of the shifting paradigm, although the pathway is likely to lead along a different but nearly parallel track. With respect to the building of structures, mechanization will become more prevalent through modular assembly.

One article of medical equipment falling into critical shortage has been nasopharyngeal swabs to test for contraction of COVID-19. To illustrate how manufacturing is changing, consider one solution that is being proposed by a partnering of scientists, academics and industry leaders centered in Boston’s Beth Israel Deaconess Medical Center (BIDMC). They’re working towards making millions of slightly-different-than-normal swabs by means of 3D printing.

In the early stages of the crisis, everyone was encouraged to wash their hands, wear gloves and avoid touching eyes, nose, mouth and all common elements (e.g. doorknobs). The latest guideline from health authorities has moved the needle on wearing a face mask from a small portion of the population to the majority. Consequently, there’s a question to be answered on the other side of this pandemic: ‘Once a germaphobe, always a germaphobe?’ In other words, once obsessed with cleanliness, will we be obsessed with cleanliness forever? Having become super-sensitized to the ‘contaminated’ world around us, will we ever return to the ‘good old days’ of unfettered sneezing, hacking and coughing in public?

Read the previous article here: The Economy Under COVID-19: Notes from the Trenches – April 8, 2020.

Alex Carrick is Chief Economist for ConstructConnect. He has delivered presentations throughout North America on the U.S., Canadian and world construction outlooks. Mr. Carrick has been with the company since 1985. Links to his numerous articles are featured on Twitter @ConstructConnx, which has 50,000 followers.