Five Years On From Covid – What Have We Learnt?
It’s now five years since the UK – and most of the rest of the world – went into Covid lockdown, and various things have changed since that period. One major benefit was a significant acceleration in the advancement of some technologies, such as video conferencing that allowed us back then – and for many still today – to work from home.
The change to our daily lives was stark. Instead of heading into the office to work, most of us were either furloughed, or required to work from home. For some, it was a change of pace that allowed them to re-evaluate exactly how they wanted to live their lives. For others, it precipitated the loss or near loss of a business that took years to build.
Some of those benefits – the ability to use Zoom or Teams to conduct meetings remotely, plus a higher proportion of staff working from home full-time or part-time meaning cost savings on office space for example – continue. But some companies are now looking to roll back those changes, and encourage more staff to work in the office full-time.
Changing work practices
For many people, the ability to work remotely has been a key determinant of which firms they are happy to work for. But as more companies push for staff to work from the office rather than their home, it seems workers are adjusting their expectations. For example, recent research from recruitment consultancy Robert Half has found that just over half (51%) of workers believe attracting new staff will be difficult without remote options, down from 68% last year.
Also, just 23% of people surveyed are looking for a new job to try and get more flexibility in their working life, which has also fallen slightly from 29% last year. This data, from the Jobs Confidence Index (JCI) – an economic confidence tracker produced in partnership with the Centre for Economics and Business Research (Cebr) – suggests that workers are becoming more accepting of the need to return to the office.
Matt Weston, Senior Managing Director UK & Ireland, at Robert Half said: “The last five years have seen a step change in how and where people work, but the big focus recently has been on the return to the office, with workers and businesses at odds for some time over what a good balance looks like. In fact, in Q3 last year our Salary Guide revealed that more than two thirds of employers would base promotions on physical presence in the office in a bid to encourage returns. Now, though, it seems as if we have finally reached a turning point, with the number of workers who believe that a lack of remote working will impact staff attraction and retention now falling.”
Stock markets are much higher five years on, despite recent falls
One major change for the better though is the performance of stock markets worldwide since the lows of the lockdown period. The lowest point for the markets in recent years was reached on March 23, 2020, just as the Covid lockdowns started to take hold. But £100 invested then would now be worth £230, according to analysis by Fidelity International.
The irony for many investors is that panicking when stock markets fall and selling shares means locking in a loss. If you can hold your nerve until the markets recover, you won’t lose anything in real terms. Also, if you have any spare cash you can invest when markets fall, this is a sensible thing to do because it is like buying stocks when they are on sale. You can buy more of the same stock for less money. Then, as the markets rise, you benefit more.
Tom Stevenson, Investment Director at Fidelity International, said: “During market turmoil, the contrarian approach can offer opportunities to investors – but it’s not for the faint-hearted. While global shares dropped 33% in early 2020, they more than doubled in value within five years.
“To achieve this, however, would have required perfect timing – which is nearly impossible. The market rebounded quickly, recovering its January 2020 level by August that year. The hardest thing about market timing is less knowing when to get out and more having the courage to get back in again before the moment has passed.”
This is worth remembering, especially as we go through another period of stock market volatility prompted by President Trump’s on-again, off-again tariffs. When there is volatility, if you have the right advice and can hold your nerve, there are also opportunities.
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