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COVID Bends Future Technology

By Michael Castelluccio
August 1, 2020
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“The pandemic brought about the biggest work experiment in history, accelerated digital trends, and has opened up new habits, possibilities and thinking.” These opinions come from Technology at Work v5.0, released in June 2020 by Citi GPS: Global Perspectives & Solutions and the Oxford Martin School of the University of Oxford.

 

Since 2015, Citigroup and Oxford have produced an annual report on the current state and future expectations for technology at work. This year’s edition is subtitled “A New World of Remote Work,” and its central theme is “COVID-19 is creating enormous societal disruptions but also new opportunities to experiment, both for business and for ­governments.”

 

The contrast between last year’s report and this year’s is often stark. Last year, the discussions ranged over wide-open vistas with many un­knowns. We were told to anticipate six different careers in our lifetimes; that 60% of those jobs don’t yet exist; and that AI won’t result in fewer jobs for humans but different jobs in which people and machines collaborate, side by side on the assembly lines and with shared software at our desks. And readers were advised to emphasize their native strengths: “Workers need a deep humanity specialization more than a deep technology one.”

 

This year, the vistas seem cramped, with workers soon to be released back to their office workspaces with new worries, including the likelihood that COVID-19 isn’t the last of these catastrophes. The chapter and section titles express some of the concerns: “Are Cities Dying?” “Impact of Telework on Real Estate,” and “The Death of Distance and the Future of Development.” A major takeaway repeated throughout the 110-page study expresses the need to innovate to increase our resilience.

 

GOING BACK TO WORK?

 

The initial question is what will the post-COVID-19 work environment look like? The study found that as we prepare to return to the office, three out of five workers would prefer to remain at home. Further, 24% of the occupations in the United States can now be performed remotely, and those occupations employ 52% of the workforce. Built into this formula are several problems. The report shows fewer than one in 10 of the bottom half of earners can work from home vs. one in two of the higher earners.

 

There are three key industries driving the shift to virtual offices—education technology (ed tech), telecom services, and software. The pandemic will not only shape the way the ed tech industry views its goals and means; the report suggests growth in ed tech could exceed the 12.5% annual growth rate anticipated through 2025. Then there’s the build-out of telecom connectivity due to increased demands, improving performance that could provide incentives for Big Data and digital technologies in healthcare.

 

If the shift to working from home were to become permanent for many, that would impact air pollution and climate change in a positive way and real estate in office markets and travel negatively. The study offers a dramatic example: “If 52% of the U.S. workforce work at home for one day a week, they will be saving 20 million tons of CO2 which is equivalent to 4.3 million passenger cars NOT driven in one year.” It also notes the catastrophic impairment to corporate travel. The significance of the collapse is that a 1% impact on corporate travel has a 10% impact on profits for the carriers. Regarding real estate, the study assumes a short-term rent and value decline in office markets due to the current situation.

 

Sometimes the most lasting lessons are those learned under duress. The pandemic is forcing mass adoption of existing technologies like ed tech’s flipped classrooms and blended learning solutions. Doctors who never made house calls are learning the value of telemedicine, and the demand for widespread 5G is increasing. The addition of augmented and virtual reality to teleconferencing and lectures is likely to emerge sooner now, rather than later.

 

According to this year’s Technology at Work, we’re in the “mid-morning” of the “post-office” era. The authors point to an image from Harvard Business School’s Frances Cairncross in 1997 that seems more likely now because of the pandemic: “In half a century’s time, it may well seem extraordinary that millions of people once trooped from one building (their home) to another (their office) each morning, only to reverse the procedure each evening… Commuting wastes time and building capacity. One building—the home—often stands empty all day; another—the office—usually stands empty all night. All this may strike our grandchildren as bizarre.”

 

You can download a PDF of Technology at Work v5.0 at bit.ly/2OaD8gV.

 

Michael Castelluccio has been the Technology Editor for Strategic Finance for 25 years. His SF Technotes blog is in its 22nd year. You can contact Mike at mcastelluccio@imanet.org.


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