Wed. May 25th, 2022

Berlin, Germany – This week, German Health Minister Karl Lauterbach told his country that it was the right time to start thinking about the COVID-19 pandemic in a different way.

“When we have it [surge] behind us… we can start opening again, step by step, ”he told local media. “It is correct to put it in perspective now.”

The German politician, who is a professor of epidemiology, is not the only European official making this call.

Spanish Prime Minister Pedro Sanchez has already spoken out about his plan to start treating the coronavirus more like the flu. Spain will “have to learn to live with it, as we do with many other viruses,” he said.

French Health Minister Olivier Veran also suggested that this could be the last wave of the pandemic.

The argument is that although infections caused by the more contagious Omicron variant of the virus are increasing rapidly, severe cases and hospital admissions have not increased at the same rate.

COVID-19 will not disappear completely, but will be managed. The disease would become endemic, rather than pandemic.

Berlin-based retailer Emily Pelich welcomes calls to consider COVID-19 a little differently.

Pelich opened her homeware store, Nos, just after Germany’s first collapse in May 2020. But for her, the most challenging aspect of starting a business in the midst of a pandemic was not necessarily logistical. “It was all the uncertainty,” she told Al Jazeera. “You just did not know what was going to happen from week to week.”

A protective mask mural on a sidewalk in Berlin, GermanyThe impact of COVID-19’s impending reclassification has not yet hit sectors of European economies hard [File: Krisztian Bocsi/Bloomberg]

Currently, the COVID-19 crisis is still being categorized in Europe as a pandemic. And despite all the optimism about a possible end to the two-year-old health crisis, any positive impact on business will take time.

Pelich says in the German capital, where COVID-19 infections are still on the rise, there are fewer people on the streets and in her shop. “We can not yet compare ourselves to Spain or France,” she said.

The impact of COVID-19’s impending reclassification has also not yet hit sectors elsewhere hard.

“Life goes on. We have to learn to live with it,” the manager of a Barcelona-based boat rental service told Al Jazeera, asking that she be withheld because she was not authorized to speak on behalf of her firm.

She said she agreed with her prime minister’s shifting stance on the pandemic, but had not yet seen the pivot translated into an increase in business. “We did not notice any differences for this year’s discussions,” she said. “[The year] 2020 was terrible. No planes coming in, no tourists. Last year was better. But how this year is going to be, it’s really too early to say. “

Neighboring Portugal is often described as one of the European countries closest to being able to name COVID-19 endemic, with about 98 percent of the qualifying population being vaccinated.

“We were back to 2019 levels last summer,” confirmed an operator at a Lisbon-based boat rental company, asking Al Jazeera to refrain from protecting privacy. “But unfortunately people are now canceling again.”

Infection rates in Portugal are also increasing dramatically.

Changing consumer behavior

For experts monitoring consumer behavior during the pandemic, it all makes sense.

“One thing we observed during the pandemic is that people make their own calculations, almost independently of what their government or institutions have said,” explains Sven Smit, co-chair of the McKinsey Global Institute, the international management consultant’s economic research arm. .

People do respond to what institutes and governments say, but also to what they see on the ground.

Sven Smit, Co-Chair, McKinsey Global Institute

Smit refers to data on what is known as “discretionary mobility” – that is, when people leave home for reasons other than work or to buy groceries.

“In most countries it is [discretionary mobility] almost perfectly in line with what is happening in hospitals and the death rate, ”Smit explained. “People respond to what institutes and governments say, but also to what they see on the ground, what they see happening to friends and family.”

For businesses, therefore, it will not be like moving from pandemic to endemic, like pushing a switch.

There will be a transition phase, one that experts at Boston Consulting Group suggested between six and nine months in a recent strategy document.

“Right now we’re all waiting,” confirmed UK-based economist Grace Lordan, director of the Inclusion Initiative at the London School of Economics.

“What’s so fascinating about human behavior is that we follow several, comparable others,” she told Al Jazeera. “We will not reach a tipping point until 30 to 50 percent of the population starts to react. Then we will see things start to adjust and move back to some stable state. ”

Who wins in the new normal?

During the pandemic, European economies saw an acceleration in existing business and cultural trends. Things like online shopping, more digital health services and working from home have become more popular. Virus-sensitive sectors that involved personal contact or travel – such as hospitality, tourism, retail or trade fairs – suffered.

This month, as markets began to respond to the promised switch from pandemic to endemic, some of the winners of the crisis were unable to maintain the lucrative trajectory they were on.

Companies such as German food specialists HelloFresh and Delivery Hero, the United States’ entertainment giant Netflix, exercise-at-home firm Peloton and online education specialist Chegg have all underperformed since the beginning of the year.

Meanwhile, firms bearing the brunt of the crisis have begun to predict better times ahead.

We will not reach a tipping point until 30 to 50 percent of the population begins to respond.

Grace Lordan, Director, Inclusion Initiative, London School of Economics

In its latest bulletin, the European Central Bank noted that by the end of 2021, locals were slowly but surely switching from spending money on goods to services. “The trade, transport and hospitality sector expanded by almost 7 percent, quarter on quarter, in the third quarter. [of 2021], “The bankers reported,” while the arts and leisure activity sector grew by 12 percent. “

Of course, this is still all part of the transition. But who is likely to win in the long run, once COVID-19 is considered endemic?

To some extent, you can see what tendencies are here to stay by determining how “tough” they are, McKinsey’s Smit explained.

“It’s actually quite simple,” the Amsterdam researcher said. “If everyone who experienced this new behavior liked it, then it will stay.”

For example, making an initial medical consultation with a physician via a phone call or online was considered by all involved to be effective, efficient and convenient, Smit noted.

On the other end of the scale, homeschooling was not particularly popular with anyone. “So the moment schools open, people will go back,” he said. While remote health care is likely to remain.

Work from home is somewhere in the middle. Some companies plan to keep it, others want staff back in the office.

How “tough” all these changes are will be resolved during the transition phase. Then the next step will involve prolonged, continuous reactions to “the new normal”.

For example, as Lordan pointed out, “In every country, corporations make these decisions. [about things like working from home] is also the lifeblood of all the small and medium enterprises around them. ”

If large firms decide that staff can work from home more frequently in the future, “you will see a change in what cities look like,” Lordan argued. For example, it is quite possible that there will be more restaurants in the suburbs where professionals work from home.

“Basic [the transition] will bring unpredictability to some sectors until everything is settled, ”the economist noted.

For Berlin-based retailer Pelich, even a little more security is helpful. “I think now we can all think things are going to get better again in the summer, then maybe we will see another boom in the winter,” she concluded. “And we need strategies for that.”

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