The big difference between 2020 and 2021-2022 is we will see a period of falling uncertainty. There are a lot of good things on the horizon. I will take my best guess at Politics, Jobs, and Salaries.
As the political season winds down we will see falling uncertainty. Why, well it looks like neither party will have a strong majority in either house of congress. The Democrats lost seats in the house and the Republicans lost seats in the Senate. It seams likely that gridlock will prevail. Which oddly enough is a good thing. The press will jump up and down screaming nothing will get done. Well is that a bad thing? I will loosely quote that famous policical philosopher Mark Twain, No mans freedom or property rights are safe while congress is in session. With gridlock we gain a degree of certainty that congress won’t change the rules, by giving an advantage to one group at the expense of another group. This greatly reduces the number of unknowns we all face.
It is not likely that any major political changes will happen. The only laws that will get passed are those that have broad bi-partisan support. Considering the polarization we have politicly there isn’t much that has any level of broad support. Anything that does go through both houses will be very watered down. Which reduces uncertainty, making decisions going forward a bit easier. Looking further down the road, when mid-term elections happen in 2 years it may further cement gridlock. Usually the presidents party looses seats in the house and senate. We may even see one or both flip parties. Even so it will still probably be by a slim margin. We may be looking at 4 years of gridlock. We may see a repeat of President Bill Clinton’s 2nd term good times for most.
With the Covid vaccine coming on board, we can expect a roll out over the next 3 months or so. As the population gains immunity we will see a big decline in uncertainty. Businesses and Consumers that have been holding off spending will loosen their purse strings. Look to this trend starting near the end of the first Quarter 2021. Many Jobs will come back a some will not. Service workers, Arts Entertainment Media, Small Business, Construction, Sales, Transportation, Manufacturing, Maintenance, Healthcare, Clerical and many low skill services jobs have faired poorly no secret there. Once businesses get used to having fewer employees it will be hard to justify filling positions that have been vacant for 9 plus months.
Businesses in the weak areas have learned to do with less or gone out of business. Many of these jobs will not come back and there will be pressure on salaries to stay low due to plenty of workers all competing for the same jobs. No incentive to increase wages or benefits. The pressure on wages will slowly slacken. Although like we saw back in 2008 there will be a lag in some cases – some sectors for a year or two. A lot of business lost out on good hires because they thought they could low ball employees 3-4 years after the great recession of 2008. A recruiter friend of mine had to reminded more than a few hiring managers that the Recession Salary & Benefit discount was over. Now is good time to hire good talent or upgrade the talent you have. As hiring and salaries pick up that too will greatly reduce the uncertainty about our lives.
The good news it those in the areas that have done well during this period of work at home will be in good stead in the short term There is even an uptick of hiring for jobs that automate business processes Think Salesforce. But this opens the door to a major change in business models. If a job can be done from home, does it matter where that workers home is? Will it matter if that home is domestic or could that home worker be in a low cost foreign market? Knowledge workers are not safe from global competition anymore. I have seen some salary pressure here but not as much as in other areas. Now is the the time to up-skill learn new skills to remain valuable in the job market.
The next 2 to 4 years look good for those of us in the business world. Don’t get districted by the press who will be desperately looking for the next pandemic or crisis to scream about, don’t buy it. The news is all about If it Bleeds it Leads. We will do just fine if we have adapted to the new environment and work for companies that are in growth areas that is doubly so. It is an excellent time to hone your existing skills and learn new ones.