The world today is more digital because of the Coronavirus.
Most of us are now working from home, purchasing most of our products online and even experiencing entertainment and social connections digitally because of social distancing.
What are the implications of all of these sudden and necessary behavioral changes?
Even before the crises digital consumption was on the rise, driven by things like changing consumer attitudues, demographic shifts and new technology. Today, the pandemic is causing this shift to happen even faster.
In Western countries so called, ‘Digital Natives’ make up about 22% of workers. These are people born after the year 1990 and have always been surrounded by technology. This population is likely to reach 43% by the year 2030.
If there is no observable shift in habits changing, likely the amount of economic activity done digitally will double in the next ten years.
As the demand for more and more digital services rises governments and industry will have to rise to meet these challenges, especially in areas where infrastructure has yet to be laid for high speed internet connections.
The adoption of mobile phones has spiked in emerging countries, although there is much work to be done in regards to increasing internet speeds that meet the demands of the workforce.
All of these changes bring about a perfect mix for disruption in the way that we work and live.
Big changes in the way of online commerce. In Western countries around 10-30% of commerce is conducted online with enormous growth in the last year. It is predicted that this could reach 50% by the year 2030.
Spike in Retail Sales Online Pre & Post Covid
Covid has caused a massive spike in digital consumption around the world.
Flex working/working from home is very likely to become the norm. Trends being observed in increased productivity could result in shorter working weeks, less time being wasted on commuting and increased opportonities for leisure activities.
43% of workers will be digital natives by 2030
50% of commerce transacted online by 2030
Processing payments in the form of cash has decreased during Covid. This likely will result in a higher adoption rate of bank and mobile money accounts, especially in emerging countries. This hopefully could lead to decreased costs for business, more transparency and a lowering of inlation.
Employment will be hit hard as a result of the growing digital economy as more lower level jobs become automated. The robotics industry is growing, with prices for industrial robots decreasing, they are likely to see a 400% increase in adoption by the year 2030. This is a cause of concern for th employment economy.
All of these factors will likely contribute to growing inequality and an even stronger call for a instituting universal basic income. As a result of this growing divide there is a great need for creating new policies that institute higher taxes on these growing technology behemoths. With more and more human transactions moving into the digital economy cyber threats and the need for data security will be on the rise.
It is a brave new world out there. Both policy makers and businesses need to be prepared for this transition.