COVID-19 Insights, Empathy
FLATTENING THE CURVE WITH EMPATHY AND COLLECTIVE CONSCIOUSNESS
While all focus is directed towards flattening the COVID-19 curve, a global unemployment pandemic is taking shape in the shadow of the deadly virus. The unemployment curve has been exponentially growing much faster than the viral spread. And if business leaders turn a blind eye, we could be facing a Global Economic Depression.
For the past two months, humanity has been facing its toughest enemy in a hundred years; a deadly virus that confined half of the world population to their homes, and put most human activities on hold. As of the time of writing this article (April 25, 2020), over 2.8 million people have been diagnosed with COVID-19, and approximately 200,000 have lost their lives to the deadly virus. Today, more than 3.9 billion people, or half the world population, is under government induced lockdown, in an attempt to slow down the vicious spread of the virus, and give healthcare systems a chance to cope and respond to the pandemic. Check WHO for up to date figures.
A LOOMING THREAT OF GLOBAL DEPRESSION
Data from every corner of the world show that the pandemic is not just the worst healthcare threat humanity has faced in a century, but COVID-19 could be one of the cruelest destroyers of jobs in human history. Fear and lockdown have dramatically slowed down the economy. In an attempt to protect their cash flow and bottom line, many businesses have resorted to laying off employees as the global crisis continues. CNN reported that a record breaking 26 million Americans have filed for unemployment benefits in the past five weeks.
Around the world, people are suffering similar consequences of the global pandemic. The UN Labour body expects the equivalent of approximately 200 million jobs to be completely wiped out globally in the second quarter of 2020. And if the virus spread pattern continues, the International Monetary Fund predicts that the cumulative loss to global GDP over 2020 and 2021 could reach 9 trillion dollars. This mass unemployment will lead to economic stagnation, and if it prolongs, could escalate the financial injury from a short-term recession to a global depression.
AN UNEQUAL OPPORTUNITY VIRUS
Just to put things in perspective, economists project job losses to COVID-19 to reach over 47 million jobs in the US alone (a third of the U.S. working population), compared to 8.7 million jobs lost during the 2008-2009 Great Recession, and overshadowing the Great Depression of 1930s by over 8%. But, although COVID-19 is an equal opportunity virus in terms of transmission, its economic consequences are not! When it comes to reducing labor cost, human resources try to retain skillful talents, the revenue generators, those who are hard to find and usually earn in the top 20 percent, and let go of low-wage earners who perform clerical and supporting tasks, and can be easily replaced when the economy gets back on track. But for the numbers to work, companies would have to let go, on average, four low-wage earners to be able to retain one skilled, high earning talent.
IT IS EQUIVALENT TO THE GRIEF OF LOSING A LOVED ONE
As decisions about layoffs are being made, it is critical to ensure fairness and equity. Corporate decision makers need to understand that the loss of work will disproportionately affect those who do not have a financial cushion to absorb the shock. To those who live paycheck to paycheck, because of the economic stagnation and the uncertainty surrounding the pandemic, psychologists note that the grief of losing their jobs equates to the grief of losing a loved one. And if they think the lay off decision could have been avoided, they will feel betrayed by their employer. This emotional daunting experience could also cause survivor’s guilt among the retained workforce. Managers should not be surprised if there is a noticeable lapse in performance, motivation and morale.
The past few weeks have witnessed many cases of public shaming on social media of renowned business people who announced the layoff of hundreds of their employees, in what seemed to be a pure number decision, with little or no concern for employee wellbeing in this time of crisis. Thousands of social media users are compiling lists of businesses they have decided to boycott, even after the pandemic is over. Although business reputation should not be the top driver for decision making during this pandemic, it is worth understanding that today’s actions will shape companies’ image and reputation in the eyes of the beholder, both customers and job candidates in the near future.
WE ARE ALL IN THIS TOGETHER
The collective nature of this pandemic is forging a sense of solidarity, a feeling that we are all in this together. People are asked to stay home and risk their livelihood to flatten the curve and protect the more vulnerable. Hundreds of millions of people are staying home, not out of fear of catching the virus, but out of their sense of social responsibility and care for humanity. Businesses are expected to behave similarly.
Businesses are expected to make some sacrifices and take risks to protect the most vulnerable in their workforce. Decisions cannot, and should not, be made to only protect the bottom line, but to also protect the people behind the line. The unemployment curve is rising much faster than the virus curve. All patterns are pointing towards a global unemployment pandemic. And if companies do not take the necessary measures to flatten that curve, we could be facing a global depression in the next few months. And when it happens, most businesses will not survive that storm.
FATTENING THE UNEMPLOYMENT CURVE
Every business should take on the responsibility to flatten the unemployment curve. The impulse to minimize cost is understandable, but every business leader must ask one question: is reducing the workforce the only place to achieve cost reduction? The consequences of this decision on employees, business reputation, the local community and the global economy are much more serious than ever before. Every executive should harness the collective creativity of people in their organization to find alternative ways to reduce cost. Every Organization is different, and cost optimization solutions are unique to them, sometimes it’s the marketing budget, sometimes operations, warehousing, or distribution. Maybe old contracts need to be renegotiated with suppliers, or other service providers. But, regardless where the sacrifices are made, the best ideas will come out of collective efforts, involving as many stakeholders and employees as possible in the process.
THE SEARCH FOR ALTERNATIVES
If all efforts have been exhausted, and trimming has to happen in Human Resources, here are some ideas that companies might consider to lessen the financial and emotional burden on their employees.
- Reduce pay rates, benefits or work hours instead of letting people go.
- Encourage staff to take annual leaves during the time the business will struggle the most.
- Schedule unpaid employee furloughs (leave without pay), while continuing employee benefits.
- Plan furloughs rotations. For example, instead of a three-month leave without pay, give staff a one-week-on, one-week-off schedule for six months. The cost would be the same, and it could help to lessen the financial burden on employees and sustain their morale.
- Encourage top management and high-earning employees to yield a higher percentage of their salary to ease the impact on low-earning staff. Creating a marginal reduction rate can help you reduce your cost further, while retaining your employees and discounting their burden.
Staff need to feel that they still matter to the company and haven’t just been abandoned. If everyone is included in the decision making process, business leaders will build empathy across their organizations, and a wider acceptance of cost saving decisions. It is very important for employees to feel that the human cost-reduction process was fair and equitable.
PREPARE YOUR EMPLOYEES FOR THE NEW JOB MARKET
If businesses absolutely have to let people go, they must approach it with empathy. Business leaders must ensure that those who are laid off have a soft landing, and are well-equipped to fight the unemployment curve.
- Find volunteers within the organization who can offer career coaching, resume writing and interview preparation workshops.
- Provide internal training in different areas of business management, or other areas of expertise you can provide.
- Open Up Your Business Network: Introduce your laid-off employees to people in your network who might be in a position to hire them.
- Send off laid-off employees with strong recommendation letters, highlighting skills that are relevant to the new job market.
Employees laid off during the COVID-19 crisis will be entering a drastically different job market, with newly forged skill expectations. Any resources or endorsements that make them more competitive in the new job market will be highly admired within the organization, and in the eyes of the public.
A SENSE OF SOLIDARITY AND COLLECTIVE CONSCIOUSNESS
With all the pain and uncertainty that COVID-19 has brought to our world, it has also restored our faith in humanity. People all over the world are showing empathy and compassion towards fellow humans. Millions of people are volunteering at the frontline of the response to keep people safe during this time of crisis. Factories have halted their operations to produce disinfectants and face masks. Others pivoted their production facilities to produce ventilators and breathing devices to save the lives of coronavirus patients with serious lung infections. Thousands of businesses are donating resources, equipment, apparel, food and money to support the healthcare system in the fight against the deadly virus. Many governments have regained long-lost trust and support of their citizens, as countries around the world are on the brink of public health disaster and economic recession.
FLATTENING THE CURVE WITH EMPATHY AND COMPASSION
For the first time in centuries, humanity feels connected. The collective nature of this pandemic is forging a sense of solidarity, a feeling that we are all in this together. Businesses should join in with empathy and compassion. If the unemployment pandemic continues, we will soon be facing a global economic depression that most businesses will not outlive. A steep unemployment curve will overburden the economy, and drain the government’s resources through unemployment benefit and government bailout programs. A flatter curve means more disposable income in circulation, which is good for businesses; and thus lower demand on bailout programs. It also gives those inflicted a better chance to find a new job, receive government aid or other forms of support in their community. A flatter curve gives the economy time to breathe and regenerate, which is crucial for the survival of any business.
Flattening the unemployment curve should now be on every company’s priority list. This is a fight for survival in a turbulent and uncertain global economy. But, whatever the exact circumstances are at any organization, one thing is for certain: employees should be managed in a way that leaves them with their dignity, and a strong sense of confidence to survive the storm.
Author
I’m a huge advocate of human-centered design, with vast interest in business design, system design and innovation management. I co-founded ERGO with the vision to restore human centricity, and advance human experience through design.
