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Covid-19 impact on business strategy – Individual contribution.
Review the Perryman Report (link below) on the recent national disaster that significantly affects all businesses in the nation and world. The focus is on Texas but most of it applies to everyone. It points out which industries are affected the most and the probable long term effect on business.
TPRTL-37-02.pdfDownload TPRTL-37-02.pdf
Discuss and relate 2 of the following and comment on other student posts:
how long do you think the business recession will last, and why
which industries will be the fastest and slowest to recover, and why
why will the strategic plan for various companies/industries be different
Discussion Board Requirements
Respond to two students posts:
Student 1( darnice): how long do you think the business recession will last, and why
You’ve definitely heard rumblings about worries of an oncoming recession given the recent talk of inflation, interest rates, and job opportunities. Although we aren’t currently in one, analysts largely predict that the United States will go through a recession this year. Governments essentially shut down large sectors of their economy to stop the spread of Covid, which led to the Covid-19 recession. But, many recovered swiftly when the globe reopened because they were well-positioned before the arrival of Covid. Economic stimulus initiatives provided the economy in certain nations, including the U.S., the boost it needed to get back on track.”The rapid revival will occur because this recession, unlike the three previous big slumps since the Depression, is unnecessary. As a result, the Federal Reserve can move aggressively to end the downturn”(Krugman,1991).
Nonetheless, Covid-19’s effects are still being felt. While there has been a significant improvement in the job situation, supply chain bottlenecks and soaring corporate profits have caused prices to soar. Most analysts now believe that this modest recession will endure somewhere between a few months and more than a year. So we’ll simply have to wait and watch until—and if—it occurs.
Which industries will be the fastest and slowest to recover, and why?
For several industries, it will take years to return to pre-epidemic levels. Small firms, which make up a large portion of those industries, may take considerably longer, if they recover at all. While certain sectors of the economy have recovered to pre-pandemic levels, others are still not completely out of the woods. “Although a tightened credit supply constrained some small firms, weak consumer demand for the firms’ products and services was a more pressing factor, reducing revenues and dampening new investment spending”(Sahin,2011).
The PYMNTS Main Street Index, which we analyze based on growth in new businesses, real earnings, and employment, indicates that the fitness, retail, and restaurant industries are still experiencing the effects of persistent social distancing practices.
The ratings on the index for fitness facilities are 3.4% lower than they were prior to the pandemic, which is the greatest departure of the three categories from pre-pandemic levels.
In contrast, the retail and restaurant industries had pre-COVID ratings that are, respectively, 1.8% and 1.3% lower. Comparatively, the rating for construction builders and remodelers is 16% higher than it was prior to the pandemic.
The epidemic also brought to light discrepancies in numerous major Main Street industries’ development rates that had always existed. While others—professional services and healthcare—have soared over prior standards, some—like restaurants and retail—remain below levels from a decade ago.
Şahin, A., Kitao, S., Cororaton, A., & Laiu, S. (2011). Why Small Businesses Were Hit Harder by the Recent Recession. Current Issues in Economics & Finance, 17(4), 1–7.
Krugman, P. R. (1991). Why the recession won’t last long. U.S. News & World Report, 110(1), 49.
Student 2(alpha): How long do you think the business recession will last, and why
The business recession caused by the pandemic are still being seen in many places. This is likely to last for some time, as it will take a while for businesses to recover and consumer confidence to return. The duration of the recession will depend on several factors, including the effectiveness of the vaccine, the effectiveness of policies, and the level of consumer demand. Many businesses will have to adjust their strategies to align with the new “normal”of the post-pandemic world, and this is estimated to last between a few months or more than a year.
2. Which industries will be the fastest and slowest to recover, and why?
The industries that are likely to recover the fastest are those that have adapted to the new normal of the pandemic, such as e-commerce, online learning, and digital health. These industries have experienced a surge in demand during the pandemic and are likely to continue growing in the future. On the other hand, industries such as travel, hospitality, and leisure are likely to recover slowly, as consumer confidence and demand may take some time to return.
References:
Pattidomm. (2022, December 27). Why everyone thinks a recession is coming in 2023. CNBC. Retrieved April 2, 2023, from https://www.cnbc.com/2022/12/23/why-everyone-thinks-a-recession-is-coming-in-2023.html
Chart book: Tracking the recovery from the pandemic recession. Center on Budget and Policy Priorities. (n.d.). Retrieved April 3, 2023, from https://www.cbpp.org/research/economy/tracking-the-recovery-from-the-pandemic-recession
