The pandemic, productivity, and the future of work – short reflections

What happens after the pandemic? This question has been asked many times since the beginning of 2020. Probably, this question is somewhat misleading, because the corona pandemic will pretty much not be over at a certain moment. It will probably – and hopefully – slowly subside, but the virus will likely remain among us, challenging us sometimes more strongly, sometimes more weakly like a cold. It is great that we have vaccines and better treatments available.

As for the future of work and economic development, there are hopes and fears associated with the pandemic. Two points seem particularly important to me:

  • The pandemic has driven digitization in many countries. Jobs – especially so-called office jobs – can now be done more flexibly. As a result, it is likely that productivity will increase. That would be good, because many countries have had low economic growth in recent years, which has made it more difficult to deal with challenges such as climate change or demographic development. These come at a high cost, which can be better managed if a country becomes more prosperous economically. Higher productivity and taking advantage of the opportunities arising from digitization should also make it possible, among other things, to improve the compatibility of work and family life as well as gender equality.
  • However, the change in work is associated with structural challenges. Companies are reorganizing and it is important to see that the changes will have both positive and negative sides. Employees who work from home, for example, will face wage losses. Employers argue, for example, that working from home is associated with lower costs for commuting or for expensive apartments near the center. In addition, more jobs could be relocated entirely to other regions or countries where wage costs are lower. In some cases, this is already the case. Thus, this development is producing winners and losers.

In general, while these developments are probably overall positive, one should not forget the downsides and the losers. Our societies face quite big structural changes.

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