Economy in Crisis: What Sectors Benefit Most from Pandemic and Lockdown and What Are Brought to Ruin?
Crises always lead to upsurge in certain sectors of economy and inflicted huge losses to the other. The economy is inevitably and immediately impacted by the nature of crisis, as in the case of COVID-19 in 2020 it has changed the usual practices of the community as a whole. We have seen in a very demonstrative way how the health crisis and lockdown have created conditions for the prosperity in certain sectors.
And while some industries have had opportunities to reorient themselves, in the service sector things are clear - either your business can thrive in this environment or not.
Here is what the latest data of the National Statistical Institute showing, dedicated to the development of the services business in three main sectors - Transport, warehousing and postal services, creation and dissemination of information, creative products and telecommunications, as well as other business services, which include many different consulting, accounting and other services for the benefit of business:
The big winners
Postal and courier services benefited hugely during the crisis.
There is nothing surprising about these champions - after all, in the context of the "stay at home" appeal, online shopping for the whole range of products flourishes - from groceries in shops and restaurants, to household products, clothes, equipment, furniture, etc.
In addition, courier services for mailing parcels are increasingly sought, as travel has been banned during certain periods, and in certain countries quarantine continues to apply to international travel. The data prove it - the turnover of the companies engaged in postal and courier services for the period April-September has swollen by nearly 20% compared to the same period in 2019.
A 24% increase in turnover is observed in the field of telecommunications for the third quarter of 2020, compared to last year. Alongside this, growth of 6 to 12% has been registered in the field of IT activities and IT services for the period since April.
The fact is that the Internet, phones and computers have become a major communication opportunity during the pandemic, for work and training including.
An absolute record in turnover since 2015 is also registered in the sector of legal activities, accounting and auditing Activities, tax consulting and management advisory activities. The data show a 16% increase for the third quarter compared to 2019, as well as for the first time since the beginning of the crisis - March. The reasons here are obvious - many businesses needed help to survive. Application documents were prepared under the state’s economic measures aimed at helping businesses. Staff was being reduced, employment contracts were changing, calculations and of all sorts optimizations were made. Administrative office activities and other auxiliary business services also have been growing throughout the the year by above 10%, and the reasons are similar.
Cleaning services have flourished in the first quarter of 2019 by 23%, and for the period from April to September they retain good positions and do not generate any losses for the year. Disinfection is important, hygiene is important too.
The big losers
Transport, tourism, the film and music industry and advertising are all in complete meltdown.
The most affected is the sector of travel agents and operator activity and all other activities related to travel and bookings - their activity for April - June shrinks by nearly 95% or almost entirely. For July-September, the industry tried to stay afloat, but nevertheless recover pace is unsatisfactory and these businesses registered a 70% loss in turnover compared to the same period last year.
No less affected is air transport, which for the otherwise strong months of July, August and September, has marked a 75% loss of turnover compared to the previous year. It's really zeroing out.
A serious business recession of about 40% is also observed in water transport. Land transport is recovering the fastest and after a 14% drop in the second quarter, it is now almost back to its pre-crisis levels.
Architectural and engineering activities, technical tests and analyses collapsed by an average of 14% in July-September, and in the previous quarter by 7% compared to the levels for the same periods of 2019. Although construction continues, investors are more cautious, and people who hire such services for finishing or repair works do not think the time is right for spending.
Advertising and market research are also affected by the crisis with a 30% drop in turnover for the April-June period compared to the previous year and an 11% decrease in July-September. Unfortunately, the advertising item is the first that a number of companies are compelled to cut out of their budget. However, according to a number of studies, this is a mistake and leads to much greater losses than saved. It turns out that marketing and advertising are the invisible engine for success in a number of activities, no matter how underrated.
Victoria Petrova, trafficnews.bg
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