• Patrick Perlmutter

6 possible long-term consequences on daily life of post-coronavirus policies in Europe

Mis à jour : 14 avr. 2020

Post-coronavirus life will involve barriers and a reduction in the economic benefits of scale and density in urban areas. For the foreseeable future, the experience of daily life will be vastly different in Europe.


As economies adjust to the precarious policies of gloablization that took form over the past 5 decades, daily life may begin to feel more like it did in the 1970s and 1980s.


Travel

Over the past decade, the ability to travel was democratized. Low cost airlines dominated the skies. Long-distance travel became accessible to the masses. The middle and lower socioeconomic classes were able to purchase long haul flights to Asia and the Americas, sometimes for less than 300€.


The complete decimation of the airline industry over the past few weeks will likely result in a policy of airline nationalization, and along with it, stricter controls on travel restrictions, most notably related to health.


Many countries are already discussing the use of immunization certificates. It is likely that in order to travel, countries will agree on a pre-screening mechanism. Those without immunization certificates will likely not be allowed to board flights. In the cases that certificates are not required, we may see imposed mandatory quarantines upon arrival at destinations.


Travel will be more national. Barriers between countries will be maintained in the short-term - until the Schengen agrees on a definitive and unified approach to travel originating from outside Europe. Such policies will likely result in higher prices, and by consequence less long distance leisure travel. Travel consumption will thus become more local, helping float some of the economic sectors, like hospitality and travel that have been the hardest hit from the pandemic.


Additionally, trains, planes and other means of densely packed travel-related services like hotels and public transport may impose limits on occupancy, further driving up prices.


A return to a travel industry that resembles that of the 80s and 90s, does not seem so unfathomable at the moment.


Restaurants and bars

Restaurants and bars have been a staple of European living since they first came into existence in the mid-19th century. Particularly in urban areas where living spaces are constrained, city dwellers favor encounters on a nearly daily basis in cafés, restaurants and bars.


If you’ve ever been to a Parisian brasserie at happy hour or to a bistro for dinner in Paris your mind will likely conjure up tight rows of packed patrons dining shoulder-to-shoulder at small wooden tables covered in red and white checkered tablecloths.


It’s difficult to imagine that tomorrow’s restaurant and bar experience will resemble that of just a few months ago.


Coming out of quarantine, it’s likely that occupancy at restaurants, bars and bistros will be much more limited, with more space between tables. It’s also not unthinkable that staff check the validity of immunization certificates before allowing patrons to enter an establishment.


The impact on restaurateurs and owners of these types of businesses will be drastic. Without the same capacity, they will likely need to turn to new ways of complementing their revenue streams.


Some have already turned to delivery and take out, and more likely will as well… confit de canard and a bottle of Côte du Rhone anyone ?


Perhaps we’ll even see a repurposing of office space for this type of recreation as the lasting effects of work-life also grow roots. While the last decade has also seen an explosion in coworking spaces, it is possible that some restaurants will even cater to or put in place private dining rooms to section off groups and create asepticized dining environments akin to those of the early 20th century.


Because of this shift, we can also expect the price of general recreation to rise. The scarcity factor in this scenario is that of space. More square meters for fewer patrons, means that bar and restaurant owners will experience higher fixed costs. So if you order that confit de canard “sur place” it may well cost you much more than the to-go option.


Shopping, groceries and retail

Until coronavirus, and even still to a significant extent today, our shopping experience was and is one of discovery. Sometimes we make shopping lists when we know what we want, but that certainly doesn’t stop us from pursuing the aisles of a supermarket, apparel shop or home furnishings store. The serendipity of the shopping experience is a significant part of why we don’t order everything online.


Nevertheless, there is no doubt that citizens of every county have turned more to ordering on the web. Deliveries on Amazon Prime Now are snatched up within 15 or 20 minutes of new availability being posted. Rungis, the produce and food market that centralizes nearly everything that is sold in France is preparing to launch a delivery service to individuals to make up for the revenue it’s losing in B2B sales.


This shift will likely hurt artisans and specialty stores that are so common across cities in Europe. Of course, online store fronts like Shopify and Etsy give small retailers access to a wider market and services like Stuart, Glovo and Deliveroo make delivery seamless. However, the vast majority of artisans and small retail business owners do not yet have the technical savvy to adopt these sorts of services.


This is both an opportunity and a threat for such companies. On the one hand, this could open up new markets to these small business owners. On the other hand, it could leave many of them behind.


One thing we have learned so far from this experience is that small businesses, basic retailers like groceries and delivery services, and more specifically, the people that work for them are the most critical employees in our economy.


Perhaps this is an opportunity for governments to create policies to protect these individuals and provide these businesses with consultants or professionals to help them in this transformation. Maybe last-mile delivery is so important that governments will want to subsidize them or even nationalize them to ensure safe and clean working conditions and the fair treatment of workers rather than allowing the gig economy to dictate the quality of life of these critical workers.


In order to protect these workers and limit contact in these scenarios of commercial exchange, end users will likely turn further to delivery and favor pre-ordering and pick up. Stores will also maintain a limit on the number of people that can enter at any given time, similar to today, but perhaps with even more rigor. Check out registers may begin to look more like bank teller windows, as they are already heading in that direction.


Family, friends and personal life

The cost and complexity of living life outside the home may well have an impact on social groups like family and friends.


Going forward, we will likely favor more intimate gatherings and relationships with only the closest of our friends and family. Rather than going out to eat or for a drink, we’ll invite close ones into our homes more often. Because of this somewhat self-imposed, economically-driven restricted social contact, we may contribute to limiting the spread of disease amongst the wider population.


As we’ve seen with the coronavirus, there is a positive correlation between the degree of proximity of social relationships and the spread of the virus. It’s far more likely for the virus to spread between members of a family and close friends than across the larger population.


While this does increase the risk of the spread of disease in tight social circles, it also means that our ability to trace contact between individuals could be far more precise. Perhaps policies limiting the population density in some establishments or the self-imposed reaction to the current environment will even mitigate the need for solutions that jeopardize privacy like those being suggested by pundits and some policy makers today.


Because of the limited space in urban dwellings and the loss of the economic and social benefits of urban dwelling, many people may decide to leave cities entirely in favor of less densely populated cities or regions. Especially if remote work becomes a staple of everyday life, many of the reasons for living close to an office suddenly disappear.


On a wider, more long-term scale, if such a scenario develops, current plans for developing larger metropolitan areas like that of the Grand Paris could be called into question. Real estate prices in urban areas will fall, and those in less urban areas will rise somewhat based on the expected increase in density or local demand for housing. A comparable situation from the past could be the exodus from urban centers that followed World War II. This time, however, rather than urban sprawl and suburbanization, we may see a revitalization of more rural communities and previously abandoned towns.


Our social groups will get tighter and more community-based. We’ll begin to make starker distinctions between friends and family and acquaintances. If this scenario develops, we’ll become more aware of and united with the people in our close geographic communities.


Another major issue that could arise concerns personal psychological challenges. Younger people have tended to be more vulnerable to psychological problems over the past several decades. Depression, a sense of alienation and anxiety are already prevalent in younger generations from Gen-Xers to millennials and Generation Z.


A substantive argument can be made that this is correlated with technology and more specifically, social media. If social isolation contributes to an increase in the time we spend on our screens, it’s very possible that a new health crisis - one that is uniquely different than any of those we’ve experienced in the West - will develop.


Our healthcare systems, let alone our societal and political acknowledgement of and disposition to mental health issues would most certainly limit our ability to handle a threat of this nature.


Large gatherings and cultural events

Concerts, conferences and expos are likely to become less common. Similarly to restaurants and bars, in order to access such events, we may be required to present an immunization certificate.


However, the scale of such events also implies that the probability of an infected person being present despite these controls increases marginally.


In the short-term, it’s difficult to imagine how these types of events will continue. They likely will not. Just like restaurants, bars and cafés, when the world does once again turn towards making live experiences available, they will likely be less populated and less dense. The costs will thus rise, and fewer individuals will be able to partake in them.


For many reasons, both commercial and social, this is perhaps the most significant opportunity for digital innovation. Video conferencing has done well to address small gatherings and meetings, where low quality video and audio do not have a fundamental impact on the overall quality of an exchange. At scale, however, the problems with existing technical mediums cannot provide an enriching experience, comparable to a live event.


In larger gatherings, particularly those in the milieus of art and creative experience, these factors will become far more critical. Today, an adequate digital parallel to a live experience simply does not exist.


Some art institutions have begun diffusing content online. Orchestras have been streaming live shows online. Recorded operas have been made available as videos online. Musical artists have streamed live sessions on YouTube. Yet, none of these can yet compare in a substantive way to a physical experience.


In some ways social distancing and the policies resulting from the post-coronavirus phase of our society could jeopardize traditional artistic expression. In other ways, we may perhaps see fully new ways of expressing ourselves artistically. Virtual reality may be an increasingly accessible component of daily life for this reason.


Work

How we work will depend largely on the existing nature of what we do. Some of us work in the service and technology sectors. Those of us that do are currently working from home, with varying degrees of adaptability and productivity. How productive and adaptable we are is highly linked to the habits and organization we’ve developed throughout our professional careers up to this point.


Startups, small companies and remote companies will find the transition to be relatively smooth. Communication by chat and video conferencing won’t drastically change the overall efficiency of our work.


Employees at larger companies that are used to existing processes which often involve physical contact, meetings, politics and in-person deliberation may feel more lost or less productive in the current environment.


It will take time and effort to adapt to these new circumstances, especially for individuals that have 20 or 30 years of experience under their belts. Corporate politics may be abandoned in favor of efficiency. Low-value work will likely be automated and technology more generally will play a bigger role in daily work and processes, contributing for better or worse to a higher degree of transparency in operational and functional work.


In addition to the unusual circumstances of working outside the office, many of us are now surrounded by husbands or wives, children or other family members. Because of the coupling of social and family life with the work environment, these additional factors bring with them a burden that can be insurmountable in the short-term.


At some point, workers in this situation will need to strike a better balance in order to be as productive as they were in pre-coronavirus times. For some this may mean totally changing their lifestyles by moving to a larger home with a dedicated office. For others, it could mean renting a coworking space. Yet for others, it could simply result in a return to quasi-normalcy - the ability to work from an office.


One thing is sure, however, even a return to normalcy will feel significantly different than the experience of open spaces, to which most everyone in the service sector is now accustomed. It is unimaginable that workspaces continue to operate at the same density as they currently do. Companies will necessarily allow employees to work from home; they will erect cubicles or even build walls in a return to traditional office spaces that create physical barriers between people.


For those of us engaged in manual work such as construction, production and retail, the world will seem fairly familiar. These jobs cannot be replaced outright in the short-term. Clearly automation will continue to displace workers further in an effort to reduce human dependency in the name of protecting health, but also as a result of the search for cost cutting, in a new world of increasing costs for primary resources.


The advantage workers will have in these sectors, at least in Europe, is that they will be considered more critical and necessary parts of society.


In Paris, for example, these workers and other critical workers in healthcare are already saluted every evening at 8pm, when the city’s residents erupt in thunderous rapture from their windows.


Collectively, we are recognizing that the people that were most marginalized are amongst the most important and vulnerable in our society. They will likely reap more social benefits moving forward, as well they should.


Policies of austerity and the suppression of the lower classes and less fiscally responsible regions will be revised in Europe as we recognize the importance of the basic services and the interconnectedness that allow for the level of societal well-being made possible for Europe’s middle and upper classes by less wealthy ones.


As our economies transition from full globalization to local production and necessity-based globalization, as consumption becomes more local, as automation displaces more workers in the service sector, and as governments begin to play a stronger role, public spending and social priorities are likely to shift.


We’re beginning to hear real discussions about Universal Basic Income; the ECB has committed to issuing European debt driving borrowing costs in southern Europe lower; even the Dutch finance minister, a strong proponent of austerity, has ceased his vocal opposition to such policies.


Since the end of World War II, Europe has held a relatively passive position in the world. The lessons it has learned from its 19th and 20th century experience have contributed to a more humanistic approach to societal governance and unity than the rest of the world.


Today is an opportunity for politicians to completely reframe policy in a modern, post-liberal context, one for which democratic socialism has prepared Europe more than any other political union.


Will our leaders rise to the challenge? Will the general public expect a fundamental pivot in policy in the aftermath of this crisis? What will we do to hold them accountable? These are the questions we should be asking ourselves at the moment.