Covid-19 and Productivity: Impact and Implications
This Occasional Paper on the impact and implications of Covid-19 on productivity by the National Institute of Economic and Social Research (NIESR) comes in the immediate aftermath of the pandemic. There is never a perfect time to reflect on the impacts of a crisis on the economy, employment and livelihoods. In the midst of the storm we are often blind, as data is scarce and in flux, and the long-term impacts get easily overhyped. And once the crisis is in the rear-view mirror, the focus is more on lessons from the past than real-time intervention to mitigate long-term effects.
However, during the Covid-19 crisis we benefited from advances in data sciences providing more real-time evidence than ever. We now have a better understanding of the short-term effects which
are well documented in this book. The authors also explain how this time around important policy lessons from past crises have helped to avoid worse in damage to businesses and jobs. Finally, the book identifies some emerging trends – in part originating from before the crisis but strengthened by it – such as behavioural changes in remote work, an acceleration of digitisation, a change in business dynamics, and a new balance between resilience to shocks and international trade, FDI and supply chain dependencies.
The long-term impacts of the pandemic are still highly uncertain. This is especially true for productivity which only changes course in a significant manner over longer periods of time. This contribution from NIESR, which is a key partner in The Productivity Institute, highlights many key facets helping policy-makers and businesses to respond to the post-crisis challenges in a timely fashion and make productivity a key part of the UK’s long-term recovery.