Given inevitable delays in rolling out vaccines, the coronavirus isn’t going to vanish soon. That’s why the pandemic will continue to rapidly alter the landscapes of globalization and manufacturing.
Half of CEOs of Fortune 500 companies don’t plan to restore business travel to 2019 levels. More than a quarter predict that their workforces will not regain their pre-pandemic sizes. Eight in 10 say that nationalism will become a dominant force in the countries where they operate, affecting supply chains, location decisions, and the regulatory climate. And most are convinced that a faster shift to robots and artificial intelligence will help insulate them against future workforce sickouts and epidemic shocks. Even if revenues have recovered for many companies, the mood in boardrooms remains dark.
Most companies and government purchasers still haven’t worked out the production and supply kinks in our pandemic era. They will diversify suppliers to be less dependent on one country such as China and build stockpiles against future disruptions. Companies and governments will move away from the long-term relationships and trade deals that sustained globalization toward less stable commitments that can be made—and broken—in rapid response to future outbreaks and black swan events.
There will be losers. The dire economic consequences of the pandemic have left millions of people bitter, resentful, and likely to blame foreign competitors for their plights. Global health and humanitarian institutions are being severely challenged by rising nationalism and difficulties in raising financial support. As a result, one long-term effect of this pandemic may be that it has made the world less resilient for the next one.