COVID-19 is here to stay – but is this the 'new normal'?
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COVID concerns have registered a small increase over the past two weeks, with professional worries rising the most – by 17%. While vaccination rates are improving, some pension professionals question whether vaccine efficacy is decreasing given the spread of the delta variant.
However, the government continues relaxing rules, leaving some members of our research panel less confident that people can act responsibly. For those who have had the virus months ago – and have not yet made a full recovery – this is all a reminder that COVID-19 remains a threat no matter how careful we are.
COVID-19 is here to stay
Despite many aspects of life returning to some level of normalcy, we have not beat COVID-19 yet. Vaccines may have increased protection against bad disease or death, but this does not mean the coronavirus has become endemic like the common flu yet. As a result, the minimum expected duration of the outbreak has extended once again, suggesting we will not be out of the woods until at least June next year.
Is this the new normal we have been waiting for?
According to our COVID research panel, working from home is here to stay – with nearly three-quarters continuing to do so despite offices reopening. This statistic contrasts the two-thirds who now say they would be comfortable attending in-person events if protective measures are taken (e.g. mask wearing, social distancing, good ventilation).
This suggests that pension professionals still strongly believe in the efficacy of digital communications and remote work – and are comfortable with some in-person contact, but at limited times. Some still shy away from public transport for these reasons.
Selective social contact or a reluctance to return to work?
Pension professionals are choosing carefully whom to socialise with, and for how long. For example, many are already seeing family in person and attending family gatherings. Those holding off on travelling within the UK, meeting friends, seeing colleagues in person or going to the pub are likely to engage in these activities in the coming weeks – but they all tend to be one-time occasions with a select group of people.
In contrast, our COVID research panel suggests we should wait until at least November when it comes to holding in-person meetings or working from the office on a regular basis, if not later. These tend to be activities that involve longer and much more regular social contact, as well as commuting – all things that still make some pension professionals uneasy.
Further economic disruption
If the 'new normal' involves selective social contact, continued social distancing and mask wearing, further disruption in economic activity may lie ahead. Some pension professionals warn that the long-term effects of working from home on innovation and productivity remain unknown. Additionally, with the next wave of infections approaching rapidly, self-isolation will lead to staff shortages in various industries. As a result, the effects of the pandemic will still be felt until Q3 2024 – a year and a half later than the most pessimistic initial projections of our COVID research panel.
Has the pandemic changed our personal and professional lives forever, and will the government be blamed if deaths start rising again? Click here to tell us in our bi-weekly survey.
Previous articles in this series:
- 11/08: Vaccine uptake has shown promise but we’re not out of the woods yet
- 28/07: Mounting concerns driven by rising cases and slowing vaccination rates
- 14/07: COVID concerns climb to their highest levels since April
- 30/06: COVID-19 concerns are down but the delta variant remains a key worry
- 16/06: COVID-19 concerns rise as delta variant delays reopening and recovery
- 03/06: Rising challenges could disrupt the country’s race towards herd immunity
- 20/05: New risks emerge as many come to grips with the spread of new COVID variants
- 05/05: COVID concern indices dip to all-time lows as most covenants are left unchanged by the pandemic
- 20/04: A silver lining – economy likely to hit pre-pandemic levels in 2022
- 07/04: Professional COVID concerns plummet to all-time lows
- 25/03: Covid concerns are down, but new risks emerge
- 11/03: Concerns over the pandemic’s lasting impact on the world of work are growing
- 24/02: Pension professionals urge caution as vaccination efforts continue
- 12/02: High vaccinations rates bring down COVID-19 concerns
- 27/01: COVID-19 concerns at an all-time high
- 13/01: New COVID-19 strain makes pandemic spiral out of control
2020:
- 15/12: Another COVID summer on the cards despite vaccine rollout
- 02/12: Divergent COVID-19 concerns show different realities
- 18/11: The risks and consequences of COVID-19 complacency
- 04/11: Sharp rise in COVID-19 concerns before the second lockdown in England
- 22/10: COVID-19 outbreak to last at least until June 2021
- 07/10: Prolonged COVID-19 outbreak is putting pressure on covenants
- 23/09: How will the second COVID-19 wave impact UK schemes?
- 17/09: Trust in UK government dwindling due to COVID-19
- 26/08: Another step in adjusting to COVID-19 uncertainty?
- 19/08: COVID-19 outbreak to last at least until February 2021
- 12/08: Trustee sentiment around COVID-19 pandemic deteriorates
- 05/08: Relaxed attitudes towards COVID-19 threaten economic recovery
- 29/07: Does COVID-19 mean the ‘end of the world as we know it’?
- 22/07: COVID-19 could weaken covenants and raise taxes and inflation
- 15/07: COVID expectations set, except for economic recovery
- 08/07: COVID concerns rise as economic outlook improves - why?
- 01/07: Lockdown easing raises COVID concerns
- 24/06: The UK government’s COVID-19 guidance attracts criticism
- 17/06: COVID concerns shift to life after lockdown
- 10/06: Will lockdown easing cause COVID concerns to rise?
- 03/06: COVID concerns at an all-time low – is the worst over?
- 27/05: Personal COVID concern subsides – but this may be a problem
- 20/05: UK pension trustees worry there may be no ‘going back’ after COVID
- 13/05: UK pension schemes don’t trust the lockdown exit strategy
- 06/05: Concerns over duration of COVID lockdown and macro effects intensify
- 29/04: Professional COVID concern spikes by 18% as trustees brace for a longer lockdown
- 22/04: Macro effects of COVID to last until 2022, with personal concerns up by 10%
- 15/04: COVID concerns fluctuate – there is no path to normalisation in sight
- 08/04: The magnitude of COVID’s economic impact remains unclear
- 01/04: Have UK pensions schemes settled into the ‘new normal’ of COVID-19?
- 25/03: Rising levels of concern about COVID and a changing economy
- 23/03: What do pension funds think about the economic impact of COVID-19?
- 19/03: COVID-19: Government response divides pensions community
- 18/03: 96% of pension funds and trustees preparing for a long-term COVID-19 fallout
- 18/03: mallowstreet Flash Insights Report: COVID-19 – what’s on trustees’ minds
About the COVID Concern Index
This short survey helps gauge sentiment of our community on the pandemic. The results are distributed via the community newsletter. Until 31/08/2020, this was a weekly survey. From 01/09/2020, the survey shifted to a bi-weekly cadence.
The COVID Concern Index values should be used as indication only and do not constitute advice. Their values are bound by the choices available in the survey on which they are based.
COVID Concern Index:
- 0 = respondents are not worried at all
- 100 = respondents are extremely worried
Expected minimum duration of outbreak:
A methodology change took place on 06/10/2020, affecting data from 20/10/2020 onwards.
Prior to 06/10/2020:
- Lowest possible value = 1 month
- Highest possible value = 6 months
Following 20/10/2020:
- Lowest possible value = 1 month
- Highest possible value = 12 months
Expected minimum duration of macro effects:
A methodology change took place on 15/04/2020, affecting data from 21/04/2020 onwards.
Prior to 15/04/2020:
- Lowest possible value = 3 months
- Highest possible value = 12 months
Following 15/04/2020:
- Lowest possible value = 3 months
- Highest possible value = 60 months
Macro rates index:
- -100 = all respondents think rates will fall
- 0 = all respondents think rates will stay the same
- +100 = all respondents think rates will rise
Sector sentiment index:
- -100 = all respondents think the sector will be a ‘loser’ in the pandemic
- 0 = all respondents see a neutral outlook for the sector
- +100 = all respondents think the sector will be a ‘winner’ in the pandemic
Concerned about the coronavirus outbreak and its macro implications? Click here to take part in the bi-weekly COVID-19 survey.