Enlightenment of the economic crisis caused by the epidemic
Where do the workplace and the church go from here?
The hottest and coldest buzzword in 2020: social distance. The world has changed as a result. The "globalized economy" that has developed over the past few decades has made many people proud, but in an instant it fell into an economic crisis and became the contemporary "Tower of Babel."
Another hot word in 2020: unprecedented. In terms of the root cause, the characteristics of the new coronavirus are cunning and changeable, leaving countries in a dilemma between blockade and resumption of work; in terms of breadth, the complete shutdown of all parts of the world is still unbelievable; in terms of depth, the damage of the epidemic to the economic system goes deep into the bone marrow. ” and the ripple effects will last for many years.
▲The hottest and coldest hot word in 2020: social distance.
Economic recovery, a long road ahead
Because of the epidemic, the negative growth of global GDP in 2020 is expected to exceed 5%1, which is the most serious economic crisis since the Great Depression in the 1930s. The United Nations predicts that the economic crisis caused by the epidemic will reverse the 30-year trend of continuous improvement in living standards and plunge 81% of the world's population into poverty. 420 million of them will enter a state of extreme poverty with an average daily income of less than US$1.90. It will make it more difficult for the 730 million extremely poor people who existed before the epidemic to escape poverty 2&3. This means that the number of deaths caused by the economic crisis may exceed the number of people killed directly by the epidemic.
Unlike ordinary economic crises, the epidemic has caused severe setbacks to both supply and demand, and it is difficult for supply and demand to return to pre-epidemic levels in the short term. Large-scale unemployment, the reorganization of global industrial chains, countries tightening trade policies, the reappearance of the Cold War, and economic recovery will be a long road. Experts have been predicting the curve of economic recovery: will it be a V-shaped rapid recovery? Or is it a slow U-shaped recovery? Or the W-shape’s repeated over and over again, the italic V-shape’s two-stage recovery, or the L-shape’s protracted slump? In the face of huge unknowns, economic experts also admit that humility is needed.
The epidemic has caused permanent damage to the global economy, and it will be difficult for the global economic aggregate to return to pre-epidemic levels for many years.
Social distancing requirements have completely changed the way businesses operate and consumer behavior. Even if the ban is completely lifted, consumer behavior will be more cautious. Increased online consumption cannot offset the decrease in physical consumption. Companies need to maintain social distance and disinfection measures for a long time, and their production capacity will be significantly reduced. The epidemic has initiated the reorganization of the global industrial chain, and corporate costs are expected to increase significantly in the next few years.
Many governments have launched huge monetary and fiscal stimulus policies, resulting in huge debts that have become increasingly heavy. These relief and stimulus measures are necessary, but how will we repay the debt in the future and bring the national debt ratio back to a reasonable level?
Unless the economic recovery is good for a long period of time, interest rates continue to be lower than GDP growth, the government carefully controls spending, and strives to maintain credit stability in financial markets - and some countries do not have these conditions to absorb debt - otherwise they will have to rely on inflation. To absorb debt, the government may raise taxes and reduce public service expenditures, but this will inhibit economic development. In short, various risk factors will remain complex and changeable in the next few years, and it is necessary for the government and the private sector to work together and cautiously weather the difficult situation.
Globalization in the eyes of the world
The epidemic has suddenly accelerated the trend of "de-globalization", causing many people to lament and try their best to stop it, because globalization has indeed brought tangible benefits: substantial economic growth and substantial improvement in productivity (the total economic growth rate in the past decade has been In volume, 75% is attributed to increased productivity) 4, cheaper and more abundant goods, job creation for developing countries, shared technological progress, improved living standards, freer flow of information and culture internationally, etc.
Globalization in God’s Eyes
Originally, God gave man the ability to create and expected man to manage the world faithfully and try his best to create value in order to glorify Him. Through creation, people produce more than they need, which is surplus value. God has given man the right to steward and also to enjoy the surplus. The book of Jeremiah says to seek the welfare of the city where you are, and when that city prospers, you will prosper as well (see 29:7). It’s a win-win situation.
A free market economy gives people the motivation to create more value and better manage the assets entrusted by God; a globalized free economy enables value-creating economic activities to achieve scale effects on a larger scale, allowing everyone in all countries and regions to exert their full potential. long-term and maximize global interests.
However, any seemingly “wise” plan that does not come from God and glorify God is unwise.
Humanity's first global effort, the building of the Tower of Babel recorded in Genesis, was a blatant disobedience to God's will. God wants people to fill the earth (see 9:1), but people insist on "dwelling there" (see 11:2); people also do not believe God's covenant that "all flesh will no longer be destroyed by the flood, nor will any flesh be destroyed by the flood again." "No more floods will destroy the earth" (see 9:11), so he used high-tech "fired bricks" to build a waterproof tower reaching the sky. The biggest problem is that the purpose of building the Tower of Babel is to spread the name of man and to compete with God.
How similar is it in today’s world?
With the advancement of global economic integration, technology has become faith, and capital and finance have made the strong stronger and invincible. Human beings have become more and more proud and disobedient to God.
Moreover, most of the benefits of globalization flow to powerful countries and the wealthy class that control power, capital and technology, making the social problem of the gap between rich and poor more and more acute. 1% people own 44% of the world's wealth5. The benefits of globalization are extremely unevenly distributed among several powerful countries and other countries; globalization is very beneficial to investors, entrepreneurs and business managers, but very detrimental to working-class people.
Developed countries have lost millions of jobs in the process of globalization, and employees of multinational companies are also facing pressure to lower their salaries because employers can move the same positions abroad, so the country's social welfare system is also threatened; developing countries What you get is low-paying, high-intensity, high-pollution work. In order to reduce costs, multinational companies often no longer adhere to the principle of just employment abroad, hire child labor, prisoners, and encourage overtime work.
▲The trend of global economic integration has made poor countries poorer and rich countries richer; there are huge differences in values in the system, making it difficult to achieve global well-being.
Rich countries get richer and poor countries get poorer
First, the layout of the global industrial chain is mainly driven by costs. In order to maximize profits, multinational companies will look for the cheapest production resources around the world. As a result, low-end industrial chains are concentrated in developing countries, while high-profit industries are concentrated in developed countries. Once a scale is formed, it is difficult to break, causing rich countries to become richer and poor countries to become poorer. The global wave of corporate mergers and acquisitions has intensified monopoly and oligopoly operations, and the market power has become increasingly concentrated in a small number of consortiums and companies.
It is also because the globalized economy is increasingly driven by capital and technology, giving groups and individuals who already have wealth greater advantages to continue to make profits. Coupled with the globalization of the financial system, the imbalance of economic development in various countries has led to frequent financial crises. The crisis hits working-class people harder, but the crisis response measures taken by governments often result in the losses caused by the crisis being shared equally between the rich and the poor, while developing countries pay the bill for developed countries with powerful financial tools.
For globalization to bring benefits to the world, participants need to hold similar values, abide by the same set of game rules, respect each other, and pursue win-win outcomes. But the problem is that there are huge differences in values in the global economic system. There are very different approaches on how to create profits, how to distribute benefits, how to take care of vulnerable groups, and how to ensure supervision and accountability. It was originally expected that the process of globalization would help developing countries make progress in protecting human rights and freedoms, but in fact, countries did not regard this as an important goal and were busy pursuing profits.
In fact, globalization is part of God’s will. In essence, globalization is the removal of economic, cultural and political barriers between countries. Christ commanded his disciples to go to the ends of the earth and make disciples of all nations (see Matthew 28:19); God wants to “gather everything in heaven and on earth into one in Christ” (see Ephesians 1: 10), the core is "in Christ". But the decades of globalization have coincided with an era when the world is accelerating away from God. Globalization without Christ is like building the Tower of Babel again, and God will not be pleased with it.
"There is a way that seems right to a man, but its end is the way to death." (Proverbs 14:12) I hope that the crisis of 2020 will calm the manic world and return to the presence of God. It is difficult to move from luxury to frugality, and "deglobalization" will be a painful and long process.
The global economic system is like a body, with cancer cells tightly intertwined with good cells everywhere. Now that you know you are sick, you need to start early and break, detoxify, and reorganize from all levels. Maybe when the time comes, we can build a new global economy that is in line with God’s will.
▲Technology will play a stronger dominant role in the future economy, and the epidemic has forced the world to take a crash course in the digital economy.
The impact of the economic crisis on the future of work
The epidemic has caused the highest unemployment rate since the Great Depression of 1929 to 1933. While many jobs will come back once lockdowns are lifted, many will never come back. Although the unemployment rate can improve significantly before the end of 2020, it will not be possible to return to pre-epidemic levels until at least 20226. Many people who are re-employed may be forced to change careers, thus reducing productivity and becoming a factor in the economic slowdown.
Technology will have a stronger dominant role in the future economy. The epidemic has forced the world to take a crash course in the digital economy, learning about remote work, telemedicine, remote entertainment, digital payment, e-commerce... This global stress test has not only established the feasibility of large-scale digital operations, but also proved its huge benefits. Therefore, countries and enterprises are currently upgrading their technology to cope with the general trend of remote working. In the future, artificial intelligence, the Internet of Things, robots and automation technologies will make many jobs disappear, such as assembly line workers, bank tellers, cashiers, drivers, pilots, telemarketers, many industry intermediaries, and even some lawyer positions.
Because computers can never reach human creativity, the professions that will most need people in the future are: professions that require a high degree of innovation (such as artists, scientists, and corporate strategic designers); professions that deal with people (such as medical staff, business managers, etc.) workers); and occupations with high levels of unpredictability (such as emergency service technicians and rescue workers). 7
The shift to remote working will also bring significant changes to the human resources market. After the epidemic, many companies began to seriously consider opening positions that allow long-term remote working to talents from outside. This way, talents from all over the country can choose from across the country or even the world when looking for jobs, without having to move to big cities with expensive living costs. Companies can also Recruit from a wider talent pool. However, companies may set lower salary standards for remote workers, but even so, remote work will allow employees to earn wages and disperse the operational pressure of metropolitan areas.
▲Churches during the epidemic have transformed into online gatherings. Some churches are adopting very creative new models.
Church: Responding to Financial Crisis
The breadth, severity, and depth of the economic crisis in 2020 may cause church giving to face great uncertainty for many years to come. How can churches turn around from financial crises?
What remains unchanged is that the church is centered on God under all circumstances. In times of difficulty, it is even more important to pray for God’s guidance, lest human hearts dictate the direction of the church’s response.
Churches can take this opportunity to carefully study their financial and operating conditions and proactively and creatively look for ways to increase revenue and reduce expenditure. For example, does every activity really contribute to the mission of the church? If you have to choose, which ones are the most valuable? Is it worth re-signing a mortgage contract or renegotiating a lease when interest rates are low? Which church property is not needed very much and can be sold? How to streamline administrative costs, reduce printing and switch to electronic weekly newspapers and electronic textbooks? Reset the air-conditioning temperature in the auditorium, switch to energy-saving light bulbs, or voice-activated light bulbs? Leasing underused synagogue space? Encourage givers to use low-fee giving methods? Encourage givers to use corporate-sponsored giving programs (such as Amazon Smile, Facebook GivingTuesday Donation Match program, etc.)?
A 2013 survey of its member churches by Evangelical Christian Credit Union found that churches spent $82% of their budgets on personnel, synagogues and administrative expenses, but allocated less budget to ministry programs—3% for children and youth ministries. Of the budget, adult ministry accounts for 2%. Is this ratio consistent with the mission direction of the church? Any adjustments?
In terms of personnel costs, can we call on more volunteers? It is impossible for a church to have all-round ministry. Can it use the "outsourcing" model to find and share ministry resources globally?
As for synagogues, in addition to trying to increase revenue and reduce expenditure, some churches may consider adopting innovative models. Some churches have divided their weekly gatherings into multiple small gatherings, which are held at home or other free locations, while renting a venue for the monthly general gathering, thus saving a lot on the total venue cost. Some churches establish the principle of small size when planting churches, and branch out into churches as soon as the number of people increases. This not only eliminates the need to maintain the church, but also maintains the close and deep connection and pastoral care of small churches, and provides opportunities for the next generation of pastors and leaders. provide more opportunities for growth.
Large, medium and small churches all have their pros and cons. The key is to faithfully fulfill the unique mission of the Christian church, be a good steward of the resources of the kingdom of God, and maximize the use of the assets dedicated to God to the mission and ministry projects called by God. .
The epidemic is big and the crisis is serious, but it is also a good time to seek breakthroughs. What I didn’t dare to think or do before is now the right time to ask God! May God lead so that companies, individuals, and churches can open their horizons, be brave in innovation, and actively connect and use the resources of all parties in the Kingdom of God. May the church of Christ be revived and witness together that God will receive great glory in the great crisis of 2020!
Note
1. World Bank.https://www.worldbank.org/en/publication/global-economic-prospects
2. Los Angeles Times.https://www.latimes.com/world-nation/story/2020-05-11/more-than-a-billion-people-escaped-poverty-in-the-last-20-years-the-coronavirus-could-erase-those-gains
3.Angelus. https://angelusnews.com/voices/financial-impact-of-pandemic-on-the-church-unclear-but-likely-catastrophic/
4. Bain & Company. 2011. https://www.bain.com/insights/macro-trends-to-add-trillions-of-dollars-to-global-gdp-in-2020-the-economic-times/
5. Credit Suisse. 2019. https://www.credit-suisse.com/about-us/en/reports-research/global-wealth-report.html
6. Politico. June 5, 2020.https://www.politico.com/news/2020/06/05/may-unemployment-rate-coronavirus-302945
7.CareerAddict. https://www.careeraddict.com/disappearing-jobs
True face, Master of Business Administration, once served as financial director of a Fortune Global 500 company, and has been engaged in investment management and economic strategy research for many years.