The COVID-19 pandemic disrupted labor markets globally during 2020. The short-term consequences
were sudden and often severe: Millions of people were furloughed or lost jobs, and others rapidly adjusted
to working from home as offices closed. Many other workers were deemed essential and continued
to work in hospitals and grocery stores, on garbage trucks and in warehouses.
A recent McKinsey report outlined some key observations which will impact the world of work into the next
decade.
- Remote work and virtual meetings are likely to continue. The report estimates that about 20 to 25 percent of the workforces in advanced economies could work from home between three and five days a week. This represents
four to five times more remote work than before the pandemic and could prompt a large change in the geography of work, as individuals and companies shift out of large cities into suburbs and small cities. The finance, management,
professional services & information sectors have the highest potential for remote work. Remote working would open up additional talent pools for business, which prior to Covid, may have made hiring decisions based on on proximity to the office. - Ecommerce has grown 2 to 5 times faster than before the pandemic. Roughly three-quarters of people using digital channels for the first time during the pandemic say they will continue using them when things return to “normal,” according to Consumer surveys conducted around the world. Other kinds of virtual transactions such as telemedicine, online banking, and streaming entertainment have also taken off. These virtual practices may decline somewhat as economies reopen but are likely to continue well above level seen before the pandemic.
- COVID-19 may propel faster adoption of automation and AI. In a global survey of 800 senior executives
in July 2020, two-thirds said they were stepping up investment in automation and AI either somewhat or
significantly. Many companies deployed automation and AI in warehouses, grocery stores, call centers, and
manufacturing plants to reduce workplace density and cope with surges in demand. The common feature of
these automation use cases is their correlation with high scores on physical proximity, and research finds the
work arenas with high levels of human interaction are likely to see the greatest acceleration in adoption of
automation and AI.
4. Mix of occupations may change, little job growth in low-wage occupations anticipated. It’s expected
the largest negative impact of the pandemic to fall on workers in food service and customer sales and service
roles, as well as less-skilled office support roles. Jobs in warehousing and transportation may increase as a
result of the growth in e-commerce and the delivery economy, but those increases are unlikely to offset the
disruption of many low-wage jobs. Demand for workers in the healthcare and STEM occupations may grow
more than before the pandemic, reflecting increased attention to health as populations age and incomes rise
as well as the growing need for people who can create, deploy, and maintain new technologies
5. As many as 25% more workers may need to switch occupations than before the pandemic. Given
the expected concentration of job growth in high-wage occupations and declines in low-wage occupations,
the scale and nature of workforce transitions required in the years ahead will be challenging, according to
research. The scale of workforce transitions set off by COVID-19’s influence on labor trends increases the
urgency for businesses and policymakers to take steps to support additional training and education programs
for workers. Companies and governments exhibited extraordinary flexibility and adaptability in responding to
the pandemic with purpose and innovation that they might also harness to retool the workforce in ways that
point to a brighter future of work.
Source: McKinsey & Co, www.mckinsey.com