Over the course of the next several weeks, JP Marvel will publish the series “2025: Long Term Effects of COVID-19”, an exploratory imagining of life in 2025, after COVID-19. Each series entry will provide a hypothetical 2025 reflection on the pandemic’s impact since 2020, focusing on a key aspect of American industry, commerce, government, society, or culture.
“First we lived on farms, then we lived in cities, and now we’re going to live on the Internet”
– The Social Network
On March 11th, 2020, the NBA postponed its season and America’s Everyman Tom Hanks announced that he and his wife had contracted COVID-19. What had previously been dismissed as a short-lived, regional virus suddenly became a global worry. Everyday life in the United States began to change to slow the virus’ spread. States closed bars, restaurants, movie theaters, and offices of “non-essential” businesses. Colleges sent their students home mid-semester and transitioned to remote learning. K-12 institutions did likewise, but their shift to remote teaching was less successful. Service employees of “non-essential” businesses were either fired or furloughed. People who continued to work in “essential” businesses were met with significant operational restrictions, especially those in the healthcare and food industries. Workers who had any capacity to work from home did so.
Before the virus, society typically considered only firemen, policemen, doctors, and nurses to be “essential” employees. Now, society adds to that classification many low-wage, low-skill professionals including grocers, pharmacy workers, delivery drivers, long haul truckers, warehouse staff, and food plant line workers amongst others. We learned during the pandemic that workers tied to essential supply chains like those of food and household supplies are essential. Society also began to recognize that these individuals assume significant occupational risk, and consequently a movement emerged to increase their wages. So far, some corporations have managed to offset wage increases by productivity gains in automation and other technologies. Companies like Amazon are even selling their high-tech operational expertise because other companies recognize the cost-cutting benefits.
The move to remote working has been happening for decades but the coronavirus significantly accelerated the trend. In 2019, 33% of jobs could have been performed remotely, though only half of the workers in those jobs did so. Today in 2025, remote working capacity has reached 60% with 50% of those workers working partially or fully from home. Companies once reticent about working at home quickly overcame their concern and adopted the practice. Many companies now embrace the idea of remote working and its numerous benefits. Employees save time and expense not commuting, and they like that less commuting is good for the environment and poses less risk to the public’s health. With more employees working from home, companies were able to reduce the size of their offices, saving considerable cash flow. Office leasing is below 2019 numbers in terms of workers per square foot. Companies of all sizes with advanced remote capabilities have relocated their urban offices to suburbs where more office space is available and at cheaper rates. Their employees moved in tandem, reviving some geographic locations. Real estate prices in cities dropped in the five years since 2020, correcting what was a severe overcapacity leading up to the outbreak of COVID-19. Only now have they begun to recover. However, prices when adjusted for inflation now sit at pre-pandemic levels.
Telecommunications companies have significantly benefited from the shift to remote working, as well as remote learning, particularly the companies on the forefront of the 5G and cloud computing revolutions. Relocated companies required the unprecedented speed and computing power of 5G networks. They also saw the necessity of superior mobile applications, and companies with the best cloud computing and virtual workplace connectivity solutions became big winners. Educational institutions also leaned heavily on these technology companies to provide the mobile learning tools required by a student pool increasingly interested in remote learning.
For employers and employees who cannot work remotely because their work requires frequent in-person contact, their COVID-19 experience has been very different. Many of their respective businesses were closed for weeks, even months, in accordance with state quarantines. When allowed to reopen, these businesses – bars, restaurants, retailers, movie theaters, etc. – were subject to strict regulations to ensure a “safe” working environment. Less staff, reduced seating, limited customer inflows, and curbside-only pickup became normative practices. Businesses were forced to retrofit their establishments – decreasing shelf space and increasing walking space – and provide employees with PPE (Personal Protective Equipment) before being allowed to reopen. Some retailers opted to close their physical locations and move completely online. Large entertainment venues were closed for numerous months, reopening to host fan-less NBA and NHL games and then slowly reintroducing other events, like concerts, with significantly reduced occupancies and major infrastructure overhauls, all in the name of transmission minimization. Today, attending these mass-gathering events is a bizarre experience for those who remember “the before times”. Smaller attendances, temperature security checks, regulated crowd controls, strict food distribution protocols, and seasonal face-covering rules have very noticeably altered the “vibe” at these events. Overall, live-event attendance is significantly down from 2020 (typically 10-50% depending on the event and venue, with those in outdoor settings faring better), and some Americans have begun to significantly reduce or even fully abandon live events altogether, preferring the convenience and safety of similar entertainment at home.
Perhaps the hardest hit industry by COVID-19 was the food industry, a very “hands-on” industry that had to undergo massive restructuring. Many food companies filed for bankruptcy, unable to cope with production and distribution interruptions caused by the virus. Those that did survive struggled with the government-mandated measures put in place later. Moreover, the worldwide supply chain for food products changed. For example, China began to shun US imports in favor of products from emerging economies under their sway. The more globally focused companies suffered consequently. All workers tied to food supply chains – from farmers to grocers – required safety training and regular monitoring by employers and government health officials.
Automation has come into favor, and its blossoming has weakened unions. Amazon, an automation powerhouse, reconfigured its warehouses and distribution processes to meet strict workplace health standards. The net effect was greater automation, which superseded more traditional manual labor. The same move towards automation and strict controls carried over to broader manufacturing. Computer parts, auto, and health products manufacturing have had varying degrees of success complying with the new health standards, and some of these businesses ultimately decided that transitioning to mostly remote operations made financial sense.
The US workplace very much reflects US labor sentiment, and the latter can well be described as very anti-globalist by historical standards. But this is not a US-only phenomenon. In the wake of the 2020 pandemic, nations began a concerted effort to re-domesticate their critical supply chains. Over the past five years, most countries have made only marginal headway. The UK and China, for example, remain highly reliant on other nations; they simply do not have the natural resources, infrastructure, and technological expertise to fully satisfy the demands of their domestic populations. The United States, on the other hand, has been very successful transforming its supply chains, moving closer to “necessity self-sufficiency”.
All of this had led to noticeable inflation in parts of the economy, particularly those tied closely to the materials, healthcare, and consumer staples sectors. Initially, COVID-19 began a deflationary trend consistent with lower demand, but that has since reversed and is approaching an inflationary level not seen since before 2008. Newly appointed “essential” workers are now demanding hazard pay, and wage increases are filtering down into the cost of products and services. On top of wage increases, companies are also absorbing expenses related to PP&E retrofitting and additional healthcare costs like onsite temperature testing. Automation, robotics, and artificial intelligence will reduce costs in the long term, but the necessary ramp-up in the short term could prove fatal for some companies.
COVID-19 led to a significant transformation of the workplace accelerating existing trends. In our next report we will discuss how our education system has transformed. Stay tuned…