Posts tagged with "recession"

Mina Tocalini, 360 Magazine, Woman at Computer

What happens to the home and economy when women leave the workforce?

The pandemic-induced recession forced many women to drop out of the workforce, with research showing they were much more likely than men to give up jobs so they could take care of children when schools went online.

The consequences of these decisions may go beyond each individual, though. 

“They could have large repercussions for the economy, the home, and society as a whole, says Andi Simon (www.andisimon.com), a corporate anthropologist, founder of Simon Associates Management Consultants, and author of the upcoming book Rethink: Smashing the Myths of Women in Business.

Some ramifications of this 2020 exodus from the workforce for women could include:

  • A drop in consumer spending. When one spouse loses a job, whatever the reason might be, it means an immediate and sudden drop in income for that household. “The impact on household earnings will lead to reduced spending,” Simon says. “That will have ripple effects throughout the economy.”
  • An impact on women’s careers and advancement. Eventually, many of these women will no doubt go back to work, but how well they will be able to just pick up their careers where they left off could be another matter, Simon says. “Will they have lost ground in the line for promotions to men who didn’t take any time away from work?” she asks. “Also, depending on how slow the recovery is, rejoining the workforce might not be that quick and easy.”
  • A reduction in demand for family-related industries. When both spouses work outside the home, couples often need to make use of services that developed or grew because one adult – usually the woman – wasn’t around to take care of certain household duties. For households where a mother is now back in the home, that has changed. “They no longer need to pay someone for childcare services,” Simon says. “In addition, the need for house-cleaning services is likely to drop.”
  • Changes to retail markets. A woman who stays home with the kids has different needs than a woman who commutes to an office each day, and those differences could be reflected in the world of retail, Simon says. Just as an example, there could be a drop in demand for makeup. Sales of business attire for women may plummet – or at least take a hit as more casual, comfortable clothes become more important wardrobe necessities. Restaurants could continue to struggle as people eat out less and cook at home more.
  • Entrepreneurial urges could shift to home businesses. Some women could still keep their career mindsets and try to establish their own businesses run from their homes, Simons says. But she cautions that there are questions about just what those businesses might be since some potential areas – such as marketing, consulting, and business coaching – have seen a downshift in demand for their services. “That leaves you to wonder just how viable setting up a home business might be,” Simon says.

Despite all those concerns, some good can come out of this period as well for women who want a better life both personally and professionally, Simon says.

“If you’ve not been satisfied with your career and your life, this could be an opportunity to rethink and rewrite your personal story,” she says. “You need to imagine what you want to become, focus on how to make that possible, and then begin to take steps to make it happen.”

About Andi Simon

Andi Simon, Ph.D. (www.andisimon.com), author of the upcoming book Rethink: Smashing the Myths of Women in Business, is a corporate anthropologist and founder of Simon Associates Management Consultants (www.simonassociates.net). A trained practitioner in Blue Ocean Strategy®, Simon has conducted several hundred workshops and speeches on the topic as well as consulted with a wide range of clients across the globe. She also is the author of the award-winning book On the Brink: A Fresh Lens to Take Your Business to New Heights. Simon has a successful podcast, On the Brink with Andi Simon, that has more than 125,000 monthly listeners, and is ranked among the top 20 Futurist podcasts and top 200 business podcasts. In addition, Global Advisory Experts named Simons’ firm the Corporate Anthropology Consultancy Firm of the Year in New York – 2020. She has been on Good Morning, America and Bloomberg, and is widely published in the Washington Post, Los Angeles Times, Forbes, Business Week, Becker’s, and American Banker, among others. She has been a guest blogger for Forbes.com, Huffington Post, and Fierce Health.

Digital illustration for 360 Magazine

Brand Building In A Recession

Building Your Brand During A Recession

By Lauren Howe and Teri Uyovbievbo, co-founders of up-and-coming South Bay marketing start-up, The Social Block

The onset of COVID-19 has ultimately ended a decade-long trend of economic growth in the United States. In it’s place, we now have the highest rates of unemployment since the Great Depression. The unprecedented economic downturn has also ushered in the swift demise of formerly successful corporations.

Although COVID-19 has brought difficulty to many businesses, the high rate of unemployment has left many to focus on what was previously their side-hustle or freelance work. A small percentage of job prospects has left us with gig work, using our marketable skills and furthering our educations.

While this is a difficult time to build a brand, it isn’t impossible. In lieu of attending meetings, speaking on panels and networking in the community, placing the focus instead on the company’s current messaging, graphics, website, public relations, social media and marketing efforts is essential. In order to get your brand in the spotlight, you’ll need to create a memorable logo so that people recognize your brand as soon as they see your awesome logo. COVID has thrust the world into a work-from-home, online shopping, and food delivery reality. Building your brand during this time is not only the smartest move for your start-up or business – it is the only move that will keep you competitive in a post-COVID world. The following steps are what we at The Social Block do for ourselves to build our brand, as well as what we would always suggest to clients.

Take relationship building digital

We know that nothing can replace face-to-face interactions and networking, but in a digital world, it’s not enough to just do one. Looking out for media opportunities, offering discounted services to local non-profits to support your community, participating in roundtables, panel discussions and curating a well-managed social media presence are all essential ways to build your brand online.

Social media has been, and is continuing to be, a method of providing customer service and increasing brand loyalty. Although the recession may be limiting those buying or product or using your service, communicating with your target audience, asking for their success stories or feedback, and showing that you listen, care and are engaged, will keep your business top of mind and keep business flowing when the economy stabilizes.

Don’t stop marketing

Depending on your product or service, you can choose from email or mail campaigns, utilizing ad space in relevant publications, or targeting your audience directly through Facebook, Instagram, Twitter or LinkedIn ads. It’s not enough to leave your growth to organic views, shares and customer/client reviews. Getting new traffic in the door and fresh eyes on your business will increase your brand awareness.

Even if COVID may cause a delay in conversions or results, you want to be one of the services or products on your target audience’s list to try after your area has reopened and the economy begins to repair itself.

Assess where your brand is at currently

It may be time to take a hard look at what branding you had going on before COVID, and determine if it is time to make a change. Is your website difficult to navigate wit outdated items? Is your social media active, and is it used to build relationships with potential clients or customers, or is it used almost as a “personal” account, full of successes and company outings? Are you participating in speaking engagements and interacting in you community? Are your graphics, presentations, business cards and logo truly representative of what you do?

Take a hard look at where each area stands, and be honest about what could change. At first glance, are you truly giving off the impression you want?

Times are tough, but it’s an opportunity to pause, reflect and rethink the way you do business.

Kaelen Fenix illustration for homelessness in 360 MAGAZINE

Covid-19 Increasing Homelessness

By Eamonn Burke

A study back in May of this year by a Columbia professor found that the unemployment resulting from the COVID-19 pandemic could increase homelessness by 45%, following a peak unemployment rate in April of 14.7%. Using data from previous recessions as well as current unemployment trends, Dr. Brendan O’Flaherty estimated that another 250,000 people would become homeless this year, bringing the total number of homeless in the country to 800,000. Across the nation, evidence of this narrative coming to fruition is clear. In West Virginia, there are 10,000 homeless students. 125 homeless people have died this year in San Francisco. Homelessness is increasing in Ohio and Texas, and Residents of Long Island are petitioning for another homeless shelter. This is just some of data to show the trend of widespread homelessness as a result of the coronavirus.

Besides taking the lives of many through infection, the coronavirus has caused a massive recession, like likes of which have not been seen since the Great Depression in the 1930s. As of last month, 22 millions Americans are receiving unemployment payments, coming after one of the best economic stretches in American history.

In addition to unemployment benefits, many people were also protected by the moratorium under the Federal CARES Act, which has since expired, allowing evictions to resume. An Aspen Institute study estimates 30-40 million people could be evicted by the end of 2020. This means even more people out on the streets and more vulnerable to getting COVID, which creates a vicious cycle and creates more pressure on emergency services. Shelters are available but often overcrowded and unsanitary.

There is also the issue of those who are older and who have preexisting conditions, who have been identified as higher risk for COVID-19 and who also are becoming more prevalent among homeless populations. Over 100,000 people over 45 years old were estimated to be living outside on an average night in 2019. Another study showed that around 85% of unsheltered people had physical health issues in 2019. Lastly, a Harvard study revealed that roughly 11 million households spend at least half of their income on housing, making them vulnerable in a recession.

There is also a racial undertone of the homelessness crisis from Covid-19, as black and Latinx people make up a large portion of the population and 58% of black and Latinx people lack the sufficient liquid assets to survive a recession. This can lead to greater racial disparity in an already tumultuous period for race relations in the country.

The CARES act also provided $4 billion in funding, which the Center on Budget Policy and Priorities, along with The National Alliance to End Homelessness used to develop a framework for how to use the money to fight homelessness. It focuses on five major points: services for the unsheltered, housing, shelter, prevention and diversion, and improving future systems.

It is expected that the rising homelessness rate with correlate with the projected rising unemployment rate through 2022. The homelessness rate was already rising with overpopulation, and the pandemic is acting as a catalyst for the issue.

Covid and health illustration

COVID-19 Evictions

By Eamonn Burke

The recession caused by Covid-19 has put millions of people out of work and out of income, making it harder for them to pay for their housing. As a result, a heightened importance has been placed on housing and income security in light of the pandemic by the United States government.

The U.S. Department of Housing and Urban Development has temporarily halted evictions and closures to help ensure housing for families and individuals. These moratoriums are a part of the CARES Act passed on March 27, including 2 Trillion dollars for economic relief. Most of these exceptions truly are temporary, however, and will be lifted when the pandemic is further under control.

Individual states are undertaking efforts to protect housing as well, and these policies can be viewed for every state in a scorecard compiled by the Eviction Lab and Professor Emily Benfer of Columbia’s Law School.

Click here for information about this housing crisis and to find out whether or not you are protected.

Unemployment and Voter Turnout

The “angry voter hypothesis” is a popular narrative that many voters are driven to the polls by economic anxiety. But a new study shows that hundreds of thousands of Americans hit by the 2008 recession actually avoided participating in subsequent elections.

The same phenomenon could happen this November as the United States experiences historic levels of unemployment, said the study’s author, Ben McCartney, an assistant professor of finance at Purdue University and an expert in household finance and voter participation. With so much financial distress on their plate, voting could be the last thing on their minds. “My concern going forward is that this story is going to repeat itself,” he said.

McCartney found that a 10% decline in local home prices decreased the participation rate of an average mortgaged homeowner by 1.6%, amounting to 800,000 potential votes over the course of the 2010 and 2012 national elections. The effect was less intense for renters and particularly severe for homeowners with little to no equity in their homes. He estimated that financial distress from the economic downturn was to blame.

McCartney used North Carolina voter files, housing data and Zillow home values for his analysis. His findings were recently published online as an accepted manuscript in The Review of Financial Studies.

“It’s a case where the opportunity costs now of voting are very high for some people,” he said. “It’s relatively easy for people to say, ‘I’m not going to worry about it this cycle. How do I figure out if I’m registered to vote? Where’s my polling place? Who is running for the various offices? I’ve got too much stuff on my plate, the economy is collapsing and I’m trying not to foreclose. Maybe now I’m taking care of the kids myself instead of sending them to day care, maybe I’m working more hours or working overtime.’ That is the story that I find fits the data better than this angry voter hypothesis.”

Fortunately, home prices have remained stable during the recent economic downturn due to high demand and low housing stock. But Zillow estimates prices to drop by 2%-3% and rebound by next year.

Four of 10 states that held their primary elections on June 2 saw a decline in voter turnout compared with 2016, according to analytics website FiveThirtyEight.com. The expansion of mail-in voting could have contributed to higher turnout in the six other states, according to the report.

McCartney said that potential voters could be more concerned about recovering from closures, furloughs and layoffs due to the COVID-19 pandemic. “Households hit hard by this crisis are going to turn to credit cards and short-term loans,” he said. “Even if the economic ship is somewhat righted by November, a lot of households’ financial situations will have really deteriorated. And, for financially distressed households, voting is something easy to just drop from the to-do list. The implications for voter turnout are worrying.”

Ben McCartney (Courtesy photo)

McCartney is a faculty affiliate in the Purdue University Research Center in Economics. His research was supported by Purdue’s Krannert School of Management and Duke University.

About Purdue University

Purdue University is a top public research institution developing practical solutions to today’s toughest challenges. Ranked the No. 6 Most Innovative University in the United States by U.S. News & World Report, Purdue delivers world-changing research and out-of-this-world discovery. Committed to hands-on and online, real-world learning, Purdue offers a transformative education to all. Committed to affordability and accessibility, Purdue has frozen tuition and most fees at 2012-13 levels, enabling more students than ever to graduate debt-free. See how Purdue never stops in the persistent pursuit of the next giant leap here.