Governments of major economies have so far successfully averted a pandemic depression, thanks to sanitary measures and massive spending made possible by unprecedented monetary supply increases and outsized borrowings. The desired effect of the spending stimulus was to encourage everyday consumption and forestall deflation through immediate financial relief.

First indications are that the mitigation measures worked, even if the long-term consequences of such large-scale spending remain uncertain and may engender problems in the future.

While an economic catastrophe has been avoided, the recovery in North America and Europe has now entered a slow growth phase.

To make matters more delicate, many employers are now accelerating change within their organizations. These transformations, which more often than not lead to massive layoffs, are only tangentially related to the pandemic. Technological improvements, changing consumer habits, and shifts in government policy—most notably in energy and infrastructure—have incentivized employers to implement change earlier and on a broader scale than previously planned, all the while using the pandemic as public relations cover, thus living up to Churchill’s bon mot that “one should never let a good crisis go to waste.”

This is occurring in nearly all sectors, and not just those more affected by the pandemic such as transportation, hospitality and leisure.

To make matters worse, there is evidence that governments will combat the pandemic slow growth and high unemployment using standard recession mitigation tools rather than the more exceptional measures used earlier this year to counter the economic effects of the Covid-19 shutdowns. In other words, governments have resigned themselves to their societies weathering the equivalent of a recession.

How long will this period of low growth and high unemployment last? At the very least until sanitary conditions return to pre-pandemic status. This is not expected before the summer of 2021 and more likely a while thereafter, since vaccines take time to deploy and are not in and of themselves a perfect solution. In other words, we must prepare for a longer rather than shorter period of slow growth.