David Wu | International Trade & Economy Fellow
The global COVID-19 pandemic is expected to lead to a contraction of global economic output by up to near 8 per cent and a spike in the unemployment rate in OECD countries—Australia included—of up to 10 per cent, with the recovery slated to take years.
As the pandemic has unfolded, education and work have shifted online, leaving campuses and offices empty, as policy-makers and organisations impose social distancing measures. These changes will accelerate the inexorable march of technology and the world of work will not be the same post-COVID-19.
The shift of classrooms and workplaces online reifies the value of these spaces as ones that have been optimised for accumulating knowledge and putting that knowledge towards productive ends. These spaces bring individuals and tools together which encourage productivity at the task at hand, while also fostering community and the exchange of ideas. This is evident in university campuses that have evolved over generations and seemingly out-of-nowhere office towers, as well as research clusters, technology hubs and financial centres.
Yet, as most organisations invest in digital tools and infrastructure such as video conferencing tools and cloud services to facilitate the shift to remote education and work, it is evident that the nature of these activities will change.
Students, teachers and administrators are now partaking in a global-scale experiment in online education. As a result of these experiments and tightened financial conditions, while the on-campus experience will continue to hold enduring value—and be newly appreciated—the quantity and quality of online and hybrid courses can be expected to increase in the years following the pandemic. And with online classes at one university being similar to online classes elsewhere, the internationalisation of the education sector will continue digitally, even as institutions face the headwinds induced by the challenge of bringing students and faculty abroad back onto campuses.
As COVID-19 continues and eventually comes to an end, many decision-makers will see their organisations anew, with ‘business as usual’ unlikely to resume.
Social-distancing induced investments in technology for facilitating remote work have the potential to lead to wide-spanning changes.
Within firms, empowered technological capabilities will accelerate the automation of knowledge work as larger volumes of data enable increasingly sophisticated algorithms to solve more complex quantitative and qualitative analytical tasks. Indeed, given a vaccine may be quite some ways away, this automation drive may also push into physical work inhibited by social distancing measures such as manufacturing and food processing. Even as most knowledge-oriented roles are unlikely to be automated anytime soon, such workers may find themselves up against talent from abroad as remote work weakens the long-standing relationship between geography and work.
Much like how the globalisation of goods production and the rise of global value chains was enabled by advances in freight and shipping that reduced transportation cases coupled with international trade policy developments, the digitalisation of the modern organisation will further enable the globalisation of services.
Many organisations will choose to permanently integrate remote work into their day-to-day practices, including in hybrid and wholly online arrangements. There is the potential here to facilitate more flexible working arrangements, including for parents.
Part of this would include the ability to reduce time spent commuting and travelling. As a result, a permanent shift to remote work also has the potential to reshape cities as individuals’ decision on where to live are less tied to their career decisions. Part of the challenge for organisations, particularly large ones, will be how to maintain their unique cultures and the internal social ties that underpin complex decision-making and large-scale implementation.
Given the increasing importance of digital tools and infrastructure in education and work, it is more important than ever to address the digital divide within and between countries.
This requires addressing both the extent of internet coverage and the speed and reliability of that coverage, particularly as the prevalence of interactive and video content grows. And this is not to mention the starkly different individual and public health outcomes between those individuals and communities that can study and work from home and those which cannot due to lack of access to high-speed internet. As technology inevitable pushes forward, with automation alongside it, it will be essential also that individuals and organisations are positioned to seize the opportunities and avoid being left behind.
Ensuring that individuals can thrive in a post-COVID-19 working world will require businesses, educational institutions and governments to work closely with one another. The policy challenges are complex and wide-reaching, including education, labour, technology, international trade, and urban and regional policy. COVID-19 has left developed and developing nations alike fragile, economically, politically and socially. Given the centrality of work in individuals’ everyday lives and the changes that have occurred and lie ahead, the organisational and policy challenges ahead are immense.
David Wu is the International Trade & Economy Fellow for Young Australians in International Affairs.