As economists scramble to assess the devastating impact of the coronavirus, they’re homing in on an unexpected hero that’s mitigating the damage in the U.S.: remote working.
With offices across the country closed and people stuck in their homes, many professional workers have accomplished a not-seamless but ultimately successful transition to online workplaces — allowing those in crucial industry sectors including professional and business services to continue doing their jobs.
The output is helping to protect U.S. government tax revenue from a total collapse, at a time when expenses are expanding; lawmakers in Washington just approved a $2 trillion plan to provide financial assistance to households and businesses.
The rapid shift means a significant portion of the economy — roughly half, at least, based on a CoinDesk analysis — might be able to continue unabated even if many households remain under voluntary or mandatory lockdowns for at least six more weeks, as Microsoft-founder-turned-philanthropist Bill Gates has suggested might be needed.
Using these technologies is likely to get smoother with practice, of course. In the meantime, many office-workers-turned-home-workers will eventually gain confidence they’re still doing their jobs so they can continue to receive their paychecks.
“It is amazing how we, as a country, seem to have really stepped up and have been able to do our jobs, for the most part, under these extreme conditions,” said Beth Ann Bovino, chief U.S. economist at Standard & Poor’s. “There’s a pretty significant chunk of people who, before the coronavirus, worked at their desks in an office. Now it’s just transplanted to working at home.”
To those who believe in a digital future in which decentralization makes systems more resilient, the crisis has expedited the inevitable.
“People are talking about how this is going to be the fourth industrial revolution with different technologies changing fundamentally how we work,” said Jennifer Christie, the head of people at social media giant Twitter and maestro behind its near-overnight shift to a distributed workforce in early March.
Christie pointed to the pandemic’s global reach. “I can’t imagine it doesn’t have an impact on organizational structures and norms,” she said.
The U.S. economy is facing such hardships that weekly jobless claims shot up to a record 3.3 million last week and the Federal Reserve pledged to inject an estimated $4 trillion into the global financial system to keep markets from unraveling — roughly equivalent to the total amount of money created on the central bank’s balance sheet since its founding in 1913. Researchers at the Federal Reserve Bank of St. Louis estimated last week that layoffs in the second quarter of 2020 could reach 47 million.
The pain is expected to hit workers on the low end of the wage spectrum the hardest, from restaurant employees, taxi drivers and musicians to barbers, flight attendants and oilpatch roughnecks whose livelihoods have been upended by a sudden drop-off in demand.