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Unemployment is hitting every country and industry right now. We can already foresee how a high unemployment rate will affect some businesses. This reality needs all of us to be creative; even a startup CEO roles during COVID-19 times change.
According to The Guardian, the United States alone hit a record of 3.3 million people filing claims for unemployment last week. Yet, it’s still early to understand the full impact the pandemic will have on the economy. Estimates by the International Labour Organization (ILO) are that the current COVID-19 crisis will raise global unemployment between a low of 5.4 and a high of 24.7 million. To give you an idea, the ILO also notes that the 2008 crisis put 22 million on unemployment.
So we’re back to those days of uncertainty somehow. But companies are facing hard times right now, as well. So there’s no better timing to look into how startups will overcome this unemployment rate.
First, looking at how China’s economy may offer a glimpse of the future is a wise endeavor. Not only were they first to go through this health crisis, but they’ve been there the longest now. And they’re starting to come out of it with people circulating streets more.
On that related note with China’s affairs, the Visual Capitalist shared how “the IMF is forecasting a global recession in 2020.” Please read further to expand on what that means a bit. In their words, “the UN estimates COVID-19 could cause up to a $2 trillion shortfall in global income.” So far, this information might somewhat already match startup and entrepreneur impressions.
Fortunately, and more importantly, though, there are also positive analyst forecasts coming from the same source. And we like keeping those alive. According to those, recovery is conceivable “as early as the 3rd quarter” of this year. Aren’t those premonitions reassuring? This prediction, however, depends not only on the final count of COVID-19 cases coming in the future but also on the actions governments take and the consumers’ level of confidence. So let’s do our part as much as we can. From individual to corporate measures, we can improve this situation together.
The advice by the International Labour Organization is to focus on three areas:
And those are great as they’re possible to achieve. Yet, the above stresses the underlying need for social protection. Trying to keep as many workers as possible through subsidies, paid leaves, and more becomes vital. It’s a measure as crucial as looking for financial and tax cuts. These tactics go well with a look at tax-related policies and other economic choices, by the way. And those, of course, include lending and more.
People and goods are at a halt. We know that. Yet, as that stands, the ILO can’t count on self-employment by developing nations. And they explain how being able to rely on those measures is usually the case. That fact is what cushions change during comparable times. Isn’t that surprising?
On top of that, the same labor organization already touched on the gap that is widening. We know workers in jobs with much fewer guarantees and lower wages are always at a higher social and financial risk. There should be no surprise there as that’s the harshly normalized state of things. And we know this fact to mainly affect migrants, younger and older people, as well as women. There’s no political agenda behind these proven data, just in case. Yet, with the current crisis, the social gap is undoubtedly getting bigger by the day. We know these times to be hitting those on the lower sphere of our social classes the hardest.
On the more human aspect of how we look at business, it might be worth asking ourselves if there’s more we could be doing towards bridging the inequality gap as we live through this crisis.
Let’s now be more specific about how a high unemployment rate will affect our business in the startup realm. Slidebean gathered a vast amount of startup expertise over the years. We have something to do with at least over 30,000 startup investor deck designs to this date, for example. And our leading CEO has an excellent reputation for entrepreneurship for which we can vouch. So we naturally want to keep the impulse of our startup focus for our startup entrepreneurs out there.
We know BEACH stocks to be the hardest hit companies of the COVID-19 downturn, for example. Booking, entertainment, airlines, cruises, and hotels are facing the steepest downfall at the moment. And considerable percentages are dropping in this industry as entire countries go on lockdown. We know it’s scary, if not just unusual, somehow. But let’s keep our heads afloat.
To begin, cross off most likely success opportunities in tourism. Saying so includes guides, travel agencies, hotels, the entire airline industry, and booking websites or companies. But it also affects travel support and insurance companies of all sorts. This fact expands to recreational sites and parks of diverse kinds, car rental companies, Airbnbs, and hostels. This sort of news also seems to be the most apparent for most people.
On the brighter side, it also doesn’t take much to see how anyone in the online and remote working tool niche is doing considerably well at this time, given the circumstances.
There are now millions of assured viewers around the world. And that’s also how a high unemployment rate will affect our business. People staying at home are relying on virtual video and audio apps to communicate. But they also use them to interact and stay connected with family and friends. Yet, people are also opening these up for entertainment and distractions or purely as a means to keep business flowing. Either way, these apps are helping people get as close to their prior everyday living as possible.
On the other hand, a large slice of people is going on paid leave. Others are facing a cutback on mandatory hours. And, as we saw, millions are plain outright dealing with unemployment. But there’s gladly also a great bunch of workers around the world whose professional duties remain untouched.
For all of the groups above, prior workout routines have sunk. Gyms and fitness studios closed. Let’s not even mention spas, the beauty industry, and other care. Fitness apps, for example, have rarely faced a better time to monetize and contribute to this global pandemic. The same applies to any platform for workout videos and other kinds of lessons. There should be no need to expand on the vitality of remote meetup SaaS startups right now, is there?
How startups will overcome this unemployment rate is precisely by taking notice of new patterns that drive consumer needs to specific areas. For example, people being indoors for prolonged periods expectedly peaked dating interest. That fact alone makes dating apps a profitable business at the moment.
But those who bring the heroic support home nowadays are professionals in the health and medicine industries of diverse kinds. Doctor-related and pharmaceutical apps are up for the lead now. And their profitability comes from their availability to go on-demand online to suit medical needs. It’s great how these startups are contributing to the urgent decongestion of hospitals and temporary health centers.
These kinds of software, however, also give a solution and have their added value. By ensuring better safety for those guarding themselves against the coronavirus, consumers can rely on convenient and hurried deliveries.
Another two areas we can think of in terms of how startups will overcome this unemployment rate is by truly making the best of biotech. And providing innovative solutions and online services through fintech is another one of the options. If that makes sense, trading is also part of a possibly positive response for fintech startups.
We hope the information we share with you now is of help. You might find yourself in a situation where running online meetings is part of what you need to do more of these days. If that’s the case, please remember we’ll gladly help structure your business presentations through our full range of startup business templates or our pitch deck services. Feel free to contact us.