Business & Finance
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The coronavirus epidemic has struck at the heart of the global economic system. It has propelled government intervention to unprecedented levels, even surpassing the controversial bailout of the banks in 2008. In this article, I explore the long lasting effects I believe the pandemic will have on the job market and the way the world functions economically.
A time like no other
Times without parallel require a response without parallel. We may have seen nationalisation, bailouts and state aid in previous times, but never before have states stepped in to help pay people’s wages. Funding has undoubtedly saved countless livelihoods and reduced hardship for millions across the globe, but it is worth noting the scale of the cost to state coffers. In my home country, the UK, public debt has topped £2 trillion for the first time.
Job retention schemes
To be frank, the scale of intervention across the board is a reminder that the consequences of this pandemic will reverberate for years, if not decades to come. Lockdowns were effectively state-imposed closures of the economy, with their eye-watering impact only suppressed by job retention schemes. The fact that countries like Germany, France and the UK have had to extend support to workers well into next year speaks volumes. We are walking a tightrope in terms of balancing the health of citizens with the normalisation of economic output. With cases starting to surge as we go into winter, a recovery bringing us back to the output of January is far from certain. In the UK for example, the economy remains over 17% below pre-lockdown figures.
Will we recover?
It would be foolish to assume every person can go back to the same job, even if the health crisis was solved tomorrow. All over the world our way of life has been changed beyond recognition, and living standards have been impacted as a result. Ultimately, we won’t know the true picture until government interventions end.
Prince Albert’s government has stepped in to help businesses worst affected by the epidemic here. It was fantastic to see the Chômage Total Temporaire Renforcé (CTTR) scheme formed to help so many employers, and targeted industry support to bars, restaurants and traders is keeping most in existence at the moment.
What the government does next is of key importance to how we emerge from this crisis. It has already spent €70 million and there are calls for the provision to be extended until the end of the calendar year. It is my strong view that more government intervention needs to be nuanced and help businesses prepare for a post-COVID future.
Back home, the UK Chancellor’s announcement of a £1,000 grant for every employee a company brings back from the job retention scheme truly baffled me. The vast majority of businesses will need to bring back at least 60% of their staff to function, regardless of their costs. The real challenge lies in the remaining 40%. This is where the government in London should have focused their attention, with more than £1,000 per employee to maximise the incentive. Instead, I fear that British taxpayers money is being used inefficiently at a time where spending has gone through the roof.
This is a reality the Monegasque authorities need to avoid. I strongly support the more efficient funding put aside for investment through the Commission d’Accompagnement de la Relance Economique (CARE) to help companies with a turnover of less than €5 million balance the books.
Our individual response
We’ve responded to challenges surrounding unemployment before and I advise everyone to spend the next few months preparing for the new economic reality. Don’t wait until the inevitable happens. In the absence of immediately available jobs I predict there will be a huge surge in people looking to start their own venture, and you can become a part of this new reality.
Start thinking about the skills you have at your disposal and how you can use these to help start your own business. Sell your services in order to gain experience. Companies are going to be weary about hiring, but that doesn’t mean they won’t have projects that you can’t contribute to. Approach them with confidence and you may have something they are looking for. Turn your consultancy into something robust- something that supports your living. This, along with contracting is the way of the future for many.
The dawn of the entrepreneur
The storm we are heading into could also be the dawn of the entrepreneur. I’ve lost count of the amount of times I’ve seen people assume that businesses are always about capital. They’re not. What is crucial is your expertise.
I work alongside a young entrepreneur called Joe Binder. Joe has told me first hand that he started his business with only £1,000, but he was able to build his company through his and his team’s expertise. WOAW now provides personal branding and social media services for numerous founders and CEOs in the UK and beyond, including myself.
For the dawn to come to fruition, we need to end the negativity in the term ‘lifestyle business’, because that’s what a business is fundamentally there to do – fund your lifestyle. Not everyone is going to be the next Bill Gates, but time after time people have managed to support themselves with entrepreneurial ingenuity and creativity. Lifestyle businesses could go on to form the backbone of the global economy. They could be our ticket out of the impending crisis.
No better time than 2020
We are better equipped now than at any time in human history to respond to the challenge of creating a business. We have technology at our fingertips, and an abundance of resources to compliment our ideas. The new normal has unlocked the idea of efficient working from home, reducing our costs and increasing our flexibility. Digital platforms are going from strength to strength, illustrated vividly by the growth of social media’s monetisation. Whether you are based here in Monaco, or halfway around the world, technology opens doors to the global market.
Lockdown has accelerated various online platform’s influence on our lives. Back in the UK, the cultural influence of fitness coach Joe Wicks’ high intensity workout was profound. He reached millions from the comfort of his home and provided some needed routine for many. The closure of schools created the need for a remote tutoring service, which Facebook’s ‘marketplace’ among others has facilitated. That’s before you factor in huge players like eBay and Etsy. For years these companies have created a platform for home enterprise- generating income without the need for employment.
We are still in the midst of this process, but there is no doubt that this crisis has accelerated growth, and created opportunity. Chris Locke, CEO of Rainmaking has seen the potential. His company dedicates itself to corporate transformation and plans to help create 1 million start-up businesses. Support is there from Chris’ organisation and others. I have lost count of the amount of times I have seen someone offer to support anyone in their network who has been made redundant on LinkedIn. It is time to think about what skills you have and how you can use them to provide value to others. Crucially, do not be afraid to ask for help. If you do not ask, you will not get.
Employment in the traditional sense may be hard to come by for the foreseeable future, but that doesn’t mean that standing still is acceptable. Assess your skills and play to your strengths. Monetise your skillset. Take stock and look for a way that you can contribute to Monaco’s recovery. Use your time wisely in order to prepare for the challenges to come. Your skills will still be at heart of your livelihood and our collective economic recovery.
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