When Will the Economy Recover?
By: Kate Drew
Recovering From the Pandemic
Bank execs don’t think the economy will fully recover from the Covid-19 pandemic until at least the second half of 2022. In fact, according to a survey conducted by Arizent, 78% of banking respondents said they were looking that far out or later in setting their strategic plans as 2021 drew to a close. And, of those, 44% said they don’t expect to see a full recovery until 2023. This is sobering data as we head into a new year, especially against the backdrop of rising cases and yet another roving variant.
Perhaps most worrying, though, is the mention of strategic planning in the survey question — it’s not just that execs are expecting a further stalled recovery, they are signaling that their business decisions are being influenced by those expectations. Or put a different way, they aren’t planning to find normalcy anytime soon. That’s extremely problematic, as it suggests that many banks may end up remaining in limbo for another year when they should be taking steps to move forward, to embrace a new normal. Being prepared for a slow recovery is one thing, staying stagnant is another.
These executives may be right; the economy may continue to feel the effects of the pandemic for quite some time, in different ways. And being realistic about that reality is important. But it’s also important to keep looking toward the future. Fintechs and other innovative players are not going to stop rolling out new products and finding new ways to serve customers, which means the target for success will only continue to advance. For anyone biding their time, falling further and further behind is a major risk.
If we are going to be reeling for a bit longer, that provides ample time to prepare for a post-Covid environment. It may be tempting to use this moment as a waiting period, to stay frozen in time and inaction. But that would be a mistake. If the last two years has taught us anything, it’s that agility matters. Being ready matters. It’s time to start thinking about what the world is going to look like going forward and how we serve customers in it. Bank executives should be looking for opportunity in the chaos of today.
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