Are we in an economic slowdown in 2020 and how will it affect you?

During the first quarter of 2020, the world was told to ‘stay home, stay safe,’ and use social media and online conferencing tools to communicate with each other. But for many, not working meant filing for unemployment insurance or other social benefits, while trying to find the money to put food on the table and keep a roof overhead.

Impact on Lifestyle

We live in a small town between Cancun and Playa Del Carmen Mexico which are destination/vacation resort areas. Many of our neighbors are employed in the travel/vacation industry, for which the ‘no work/no money’ scenario resulted in many of them leaving the area, and returning to stay with relatives in other Mexican states. A neighbour drove to Todos Santos Baja Sur, on the west coast of Mexico, a 3,000-mile road trip which took him 5 days to get there, by himself.

The impact on the local economy was immediate, with families bicycling around early in the morning to collect recyclables, no garbage bin was left untouched, and front yards turned into take-out restaurants.

In Canada, federal, provincial, and municipal/local agencies and departments implemented a number of social/financial relief programs in an attempt to keep people in their homes and apartments for the duration of the quarantine and possibly beyond.

Mortgages are being extended to provide financial flexibility to homeowners, struggling to meet their living expenses, but the missed payments are being added to extend the mortgage.

The premise of the extension of the mortgage reduction or reduced rent was based on the debtors returning to work at a given point in time, but it’s just now that we’re hearing about what businesses can open when, and the conditions attached to remain open.

Working has Changed

The structure and manner of most clerical and administrative work have changed going forward with a portion of the workforce working remotely, using video conferencing and social media to connect, and email to conduct business, but that’s not for everyone.

Due to the proliferation of automation and the deployment of AI (artificial intelligence), robotics, online services, and chatbots within the different pillars of the economy, not as many people are going back to work the way they did before the COVID-19 virus hit.

Pillars of an Economy

For those that are unfamiliar with the term  ‘pillars of an economy’ please click on this link that leads to a more detailed description of Keynesian economics theories, for which it has been used by economists since the Great Depression.

There are specific sectors of the economy that increased their bottom lines and made money during the COVID-19 quarantine, one being online retail sites with ‘to your door’ home drop-off.  It’s a great service for my stepdaughter and grandchildren who live in a rural community, as the items they order are sent to their doorstep in a couple of days.

Google is currently piloting fleets of drones within specific rural communities throughout Canada and the United States to drop off orders, which means fewer humans are required to do the manual drop-off of consumer goods.

Structural Unemployment/Reemployment

Many are not going back to their employer or a job as the premises might be closed down, or closed/relocated to another area. There are several factors/reasons why these displaced humans are being impacted by ‘structural unemployment,’ which is a term used to describe the reduction of certain jobs due to economic conditions for which now the jobs are no longer around.

Structural unemployment creates economic instability within the general population/labour pool and reduces personal/employment tax revenues for governments.  Not a good situation for anyone.

Structural unemployment is here to stay; it’s been around since the days when assembly lines began automation, more recently displacing workers with robots, which was positioned as a method to reduce the cost of labour component in the manufacturer’s price to produce an item.

Many needed to make money quickly, which meant filing for unemployment, and using what little savings were in the bank while looking for a job to help pay the bills or enroll in a training program.  Many families did not possess three months’ worth of savings in a bank account, so it was the ‘I’ll take what I can get until something better comes along’ mentality.

The needs of these workers’ families were much more immediate; many faced the daunting prospects of juggling part-time jobs to keep the household afloat. Many of these newly employed staffers at the sorting and distribution facilities faced the reality that this is what they’ll be doing for the near future to put food on the table and keep a roof over their heads.

Ironically, online retailers and delivery companies hired a portion of the recently unemployed to work as contractors at sorting and distribution facilities but at lower wages than what they got before the quarantine. In many, there were no healthcare benefits, unless they were hired into management.

Again, there are parts of the economy that prospered during 2020 Q1, such as online video conferencing services, food delivery companies, and online retailers, which begs the question…how are they succeeding?

The New Economy

Let’s look at one sector, the online retail industry that has been thriving; one company – Amazon – started doing business out of a garage in the early 1990s and is the number one net new employer. It grew based on the concept of the old catalogue shopping that our parents or grandparents used, and the internet changed the way people shopped.

Proof? Look at the number of bricks and mortar retail locations, chains, and malls that got mothballed due to sagging sales, as people turned to online retail sales to acquire products and services.  And for those quarantined in their home for an extended period of time, the convenience and safety of online shopping is a no-brainer!

The questions people need to ask themselves are:

1) How can it help me?

2) How do I get a piece of that online retail pie?

3) What do I need to do to get started in it?

There are different ways; to market and sell content online, such as guides, storybooks, or author-based content to the global readership, but then again, not everyone is an author.

Establishing an online or social media account and partnering with advertisers to generate referral-based commissions based on the activity of your followers, etc., is another way. Retailers will pay commissions for each sale of their product or service, which takes time.

Not MLM

Another less prevalent form of online sales is being the aggregator and automated referral agent for particular lines of products and services that others will purchase and requires a different way of thinking to generate revenue.

The key is to garner the attention of a prospect, bring them to your site, and motivate them to buy their products from your website.

Please understand that it takes time, energy, and work to make it happen, as I know a female pensioner who has been doing this for a little while, and is now making an additional $700 per month just from the sales commissions for the goods that are linked from her site!

There is no inventory to acquire, no presentation meetings to ostracize family and friends, no products to carry around in your car, or a booth to set up to sell products. The beauty is it’s all done via a visitor to your site buying the product or services you market.

Affiliate Marketing in an Economic Slowdown

It’s commonly known as internet-based affiliate marketing. Think of the internet as the highway and your website is the traffic sign/traffic director to take visitors from the highway to your virtual store…and you receive a commission each time someone buys something!

The platform and services require the host to create content about the product and services being offered in an engaging way that motivates the visitor to continue through to the purchase.

We’ve all seen online ads about people making thousands of dollars a week or month, but it has taken them the time to build and develop the business; it’s all about having the right products/services and doing it the right way.

Do You Have What It Takes

It’s not for everyone as it requires commitment, discipline, and focus to get the configuration set up, and putting in the time to learn the right way to do things, which is normal for a business that’ll last.

Some governments offer new business grants, loans, and subsidies to those who need help to get their business started, so just go for it!  The time has come to realize that the old economic models have changed, technology has reshaped and reformed the way we work, how we communicate with family and friends, and how we shop for life’s needs. Why stand in the long ever-winding lineups outside the big-box retail locations, in fear of contracting a virus that just might KILL YOU?

It’s time to start opening your minds to the automated online shopping experience and become part of the retail revolution and the new lifestyle paradigm that is the ‘new normal.’ Don’t be left behind, anymore!

Need proof?! The owner of an online retail company did it despite all the ‘naysayers’ and a little while ago he bought a $77 million dollar yacht. Now you may not want a yacht, but some extra cash in your pocket is reason enough to float your boat, or better still keep the roof over your head!

Ready to start your own Online Business? Everything you need – from building your website to creating content to making revenue – all at the click of your fingertips. Let’s get started with a Free Website and Affiliate Marketing Training!

 

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