Triple Whammy: Three post-COVID-19 issues to consider
The global COVID-19 pandemic has disrupted business as usual for nearly all, especially in the areas of service workers, work from home options and racial inequalities.
Service worker shortage. Many services organizations cannot find labor to fill jobs. This was a problem last year, but it is even worse right now. Staff have disappeared due to the unemployment stimulus. Local wages are proving lower than the federal boost to Michigan unemployment payments, so there is incentive to remain on unemployment. Although receipt of unemployment funds requires certification of inability to find a job, service industry workers are currently scarce. Lawn services like Vidion Landscaping are having to turn away new business due to not having enough workers to service accounts. Restaurants are not able to fill openings.
Some of the difficulty stems from the nature of our service industries in having seasonal employment opportunities. The federal Small Business Association’s Paycheck Protection Program’s “forgivable debt” loans cover payroll expenses in an effort to keep people employed. Yet northern Michigan businesses did not have their increased summer work force in place as of Feb. 15, 2020 – the date by which payroll was measured for PPP forgiveness eligibility. On the employee side, many unemployment filings were based upon winter jobs and not new summer opportunities, which could be providing a loophole for continued benefits despite summer job openings. Other employees do not want to risk personal safety to take on front line jobs. Further, there has been little lead time when a new phase of reopening is announced, creating a lag from the date that reopening is officially allowed and pent-up customer demand starts pounding on business doors. Perhaps job applicants will increase after July when the federal boost to unemployment ends.
Work from home now acceptable. Naveego is fortunate to be a software company with products based on cloud technologies. We were able to seamlessly move operations from in-office to working from home without impact to customer service, R&D or new product releases. Productivity actually increased due to eliminating commutes and staff fear of contracting the virus.
We felt operational impact from COVID-19 to our sales processes, which relied heavily on in-person engagement. That being said, our sales team includes employees from hard-hit Detroit and New York City, who already worked 100% remotely pre-COVID, so in many ways we were prepared for the shift.
Many other northern Michigan businesses were not similarly situated; many have operations that require in-person staff to service customers. The nature of a business is central to its ability to adapt to closing doors to in-person customers, and many tourism, healthcare and personal services cannot be performed from afar. Yet when you break down job functions and tasks, most organizations have a portion of operations that can be remotely performed. We just didn’t see it that way because our northern Michigan norm has been predominantly going to the office every morning.
Part of the pain felt in our local economy is due to many businesses not having processes or technologies for running business functions remotely. Yet as TC showed impressive resiliency and people reconfigured kitchen lines for curbside delivery menus and retail spaces for new social distancing requirements, businesses realized that back end office functions can continue with remote workers.
Nationally in the tech industry most companies are planning to increase remote employment. Facebook, Oracle, TripAdvisor and Twitter, among others, have announced permanent work-from-home options. Since the tech giants are hiring and increasing remote work opportunities, tech companies in Traverse City need to offer the same work-from-home options on an ongoing basis, or else risk losing local talent to companies outside of our region. This is catching on locally, as Hagerty has announced plans to keep its current office footprint during a growth phase of hiring 100-200 new employees due to increasing work-from-home options for its team.
The impact of remote operations extends well beyond the tech industry, which was already equipped for it. By being forced into remote operations, some who had never tried it and some who thought it was not desirable or not doable have changed their minds. For example, Munson and private practice physicians jumpstarted telemedicine initiatives to see patients virtually during the pandemic. Although it was an adjustment, it worked for monitoring treatment plans. Patients benefited from not having to travel for appointments.
We will likely see increased work-from-home opportunities for local businesses on a permanent basis.
Racial inequalities amplified. The murder of George Floyd set ablaze demand for change across our country. While it is easy to sit back and judge communities elsewhere from our zone of northern Michigan safety, free from lootings and arson, the economic impact hits us too. First, we need to support local minority-owned businesses. Minority-owned businesses typically have a more difficult time finding funding sources than businesses owned by whites and they need our support during this economic crisis.
Second, economic losses from other communities mean less discretionary income for travel and a hit to our tourism economy. This is a reminder that diversification of our economy to include sustainable year-round business is essential to our survival.
Finally, think about how, as a business community, you are treating minorities. It has been a privilege of hiring the best talent available from across the country that Naveego’s staff is diverse. Diversity on our team makes us stronger because we bring different experiences and perspectives to our work. If we all came to the table with the same ideas, we would not excel in R&D, problem-solving or adapting to new business challenges to the extent we do.
Yet our minority employees have faced stares when walking down Front Street. They have been followed by store security while shopping retail and have received less than stellar customer service when trying to buy a new car. They have had extra trouble renting apartments despite making a great income as tech professionals. To be clear: Though many in northern Michigan do not behave this way, my point is that no one should.
Our economic development corporation is actively recruiting companies to open operations in TC. Companies will not want to move here if employees feel unwelcome due to the color of their skin. Think about how you treat others. Do not treat patrons of color as if they are not qualified to be your customer. A smile in passing on Front Street can go a long way to making all people feel welcome in our business community.
Katie Horvath is the CEO of Naveego in Traverse City. Reach her at email@example.com.