The 20 Industries That Will Never Be the Same After the Coronavirus
From: www.gobankingrates.com
There are occasions when a crisis sparks a wholesale change in the way that America does business. One of those epoch-shifting moments when people are forced to take note of a process they might not have questioned before, only to realize it has to change. Likewise, sometimes it’s a matter of an industry just needing that push to take steps toward the future that might otherwise have dragged on for years. Regardless, a major crisis can often spark major changes in the economy, and thus far, it appears the coronavirus pandemic won’t be any different.
Across the country, many businesses are in the process of learning a lot about their supply chains, their products, their workforce and perhaps most of all, just how crucial it can be to have infrastructure in place for remote work. As the coronavirus has essentially redefined the 2020 business year across the U.S., it’s also pushing forward changes — bad and good — for industries everywhere.
Agribusiness
Few businesses can be as labor-intensive as farming, particularly with regards to harvesting. Without a large group of workers willing to do very hard, manual labor for very low wages, America’s food supply would — at the very least — be much more expensive. As such, the need to limit travel and practice social distancing has led the State Department to announce that it would no longer be processing visas at any of its offices in Mexico, essentially closing off American fields from migrant workers who constitute as much as a tenth of the legal workforce.
Why It Will Never Be the Same
The timing of the coronavirus pandemic means farmers are going into this planting season aware that they might not be able to access the necessary labor come harvest time, potentially changing what they opt to grow to something that won’t rely so heavily on pickers. Visa programs remaining suspended could also force farmers to seek out other ways to fill their major labor shortage.
At the very least, if Americans take note of major differences in prices and availability of certain foods come summer and fall, it might make the average consumer better understand the role that these low-wage workers play in agriculture.
Air Travel
Airlines operate on very small margins, so they tend to be especially exposed to the shocks of any major crisis. However, even with that in mind, the sudden loss of almost all of their business for an indefinite period of time is the sort of hit that seems impossible to survive.
To add insult to injury, airlines can’t even take advantage of the rock-bottom oil prices at the moment.
Industry trade group Airlines for America estimates that major carriers will run out of cash by the second half of the year without a major infusion.
Why It Will Never Be the Same
Airlines use long-term loans and leases to finance their incredibly expensive aircraft, meaning their typical cash burn is very high. With new revenues essentially nonexistent, many observers feel confident that the industry’s smaller players will eventually go out of business as the bills keep mounting.
That means there could be a wave of mergers and acquisitions in 2020 as the larger carriers with the resources to survive consolidate the industry. There might even be a reassessment of the 75-year-old Chicago Convention that essentially bars foreign ownership of airlines.
Amusement Parks
There’s really no way to keep amusement parks open in the time of social distancing, so locations across the country are feeling the hurt right now. Currently, most amusement parks are shuttered until further notice, and even those that might be able to reopen sooner rather than later are likely going to need a variety of measures in place to limit social contact as much as possible.
Why It Will Never Be the Same
In a similar story to many other industries, the smaller parks are likely to take the hardest hit. While companies like Disney or Six Flags might have the financial wherewithal to outlast COVID-19, many other parks without that sort of national footprint are unlikely to be able to stay in business while experiencing a total loss of revenue for months at a time.
Bowling
Bowling is a part of the fabric of American life, with alleys in virtually every corner of the country. However, it’s also among those businesses that can’t be expected to stay open while it’s so dangerous to be gathering in small or large groups. According to data from Yelp, good ole tenpin was down 43% in its share of seasonally adjusted daily U.S. consumer actions from March 1 to March 18.
Why It Will Never Be the Same
Lingering social anxieties about shared spaces and equipment aren’t going to make it easy for bowling to recover, even after the country reopens. And with months of lost business, it’s safe to say that a slow start is likely the last thing alley owners need. Independent owners are likely already struggling not to close permanently.
Breweries
While beer sold for home consumption isn’t at risk, it’s important to note that a large portion of breweries across the country are the sort of brewpubs where the ambiance is important and in-person sales matter a lot. Yelp revealed that breweries were down 71% in share of seasonally adjusted daily U.S. consumer actions for the month of March.
Why It Will Never Be the Same
Selling to customers interested in picking up a growler or a six-pack to drink at home is one thing, but without the additional food sales and casual customers looking for a drink or two with friends, it’s not hard to see how many of the 8,000 independent brewers in America will be in dire straits. A prolonged closure could force many to close down — or sell to major beer conglomerates.
Casinos
Running a casino is essentially a license to print money — it’s part of why they tend to be steeped in excess and attached to enormous hotels. However, all that investment depends on people coming through their doors and dropping money on games they’re mathematically rigged to lose. Without customers coming in to gamble, casinos are looking at an enormous infrastructure without a purpose at the moment.
Why It Will Never Be the Same
Even after they reopen, casinos could be forced to take a variety of additional steps to ensure customer safety. Such measures may continue to depress revenues — not to mention, people’s fear might lead them to avoid their favorite gambling palaces for some time after the country reopens.
What’s more, online gambling has always provided competition to casinos, but now it will have an important chance to snap up a host of new customers — not all of whom might return to gambling in person after this has passed.
Clerical Work
In an example of how not all change has to be bad, the nature of clerical work might be in the process of changing forever. Simply put, the only clerical work going on in many parts of the country is that which can be done remotely at home. As of early April, the Axios-Ipsos Coronavirus Index found that around 42% of the workforce reported being told to work from home last week.
Why It Will Never Be the Same
Telecommuting has been on the rise for a variety of reasons — from its potential for reducing the gender wage gap to its ability to reduce traffic and ease the burdens on infrastructure.
Now, the economic reasons for building a business that your employees can keep running even when they’re unable to leave their house are on very clear display.
Clerical workers might see more and more of their jobs shifted out of the office and toward telecommuting even after going in becomes an option again.
Cruises
Cruises have been hit especially hard by this crisis. The two hardest-hit stocks on the S&P 500 on April 1 — when a dreary prediction about how difficult the coming weeks would be from President Trump sent the market slumping — were Carnival Corp. and Royal Caribbean Cruises. With major gatherings off the table until the virus’ spread has been substantially reduced, the cruise industry is currently adrift.
Why It Will Never Be the Same
Cruise ships were already dealing with negative PR about some very public norovirus outbreaks. However, with horrifying news reports of entire ships being placed under quarantine and people being stuck in their small quarters for extended periods of time, the perception that going on a cruise is like climbing into a petri dish is going to be even harder to shake.
It’s possible that many consumers will simply never see the cruise industry as being totally safe again. It remains to be seen, but it’s not hard to imagine business remaining down for cruise line operators everywhere even after they can start booking passengers again.
Events
For most Americans, they might visit one or two conventions in a year — if any. That has a tendency to make most people overlook just how big the industry is when taken as a whole. The number of people employed in various capacities to put on major events — from balloon twisters to sound technicians — is very large, and essentially all of them aren’t working right now. Whether it’s small birthday parties or massive auto shows, most of the country has essentially pressed the pause button on any and all events, leaving these people scrambling to make ends meet.
Why It Will Never Be the Same
Many operations related to event planning could be forced to close permanently during the extended break. Catering companies, event spaces, even display designers will have to figure out how to make things work with a massive hole in their income statements that covers much of the year — not something that any business is built to withstand. Once again, expect the bigger companies with more resources to have a shot at lasting while the smaller players could go under while waiting for the country to reopen.
