Which Trends Will Last in a Post-Pandemic World?

August 24, 2020

The global health pandemic has shifted the way we live, work and play. Social distancing, working from home, online shopping (e-commerce), online schooling and internet socialization — these have become the norm for many people across the globe.

Some new trends were forced upon us (like social distancing), while others that were already underway were accelerated (like the rise of e-commerce). In this article, we'll take a look at how these trends affected the market, and which ones are here to stay.

How has the pandemic changed consumer behavior?

According to Mastercard SpendingPulse, e-commerce nearly doubled with spending growing by 93% year over year in the month of May.

 

Source: Mastercard Recovery Insights

Meanwhile, retail and food service sales have rebounded surpassing pre-recession levels. However, the recovery and this shift to a more digital world has not been a smooth or an even transition.

As expected, households focused more on essentials rather than luxury items during the pandemic. The home improvement area benefited the most in May, while jewelry and department store sales fell.

Source: Mastercard Recovery Insights

There are several reasons why the home improvement sector is doing well. When the world economy shut down early this year, many people were forced to live, work and even socialize within their homes. Those working from home needed to set up home offices. Schools closed or went to online classes, making homeschooling areas important for many households. There was also an exodus from crowded larger cities, with many moving to the openness of the suburbs.

Which pandemic trends are here to stay?

More flexible work environments, virtual entertainment and virtual socialization are here to stay. However, the speed in which we integrate the virtual world with the in-person world will likely slow as the impact of the global pandemic lessens over time. Not every business, school or household was prepared — or even had the ability — to shift to a more digital world right away. Those that have adapted will have an advantage, at least in the near-term.

Source: Mastercard Recovery Insights

The longer-term impact is more unknown. Some industries will be more likely to benefit from the changes. For example, health care may see a boost from governmental spending to strengthen medical services. Technology will continue to benefit from the increased use of the internet, along with the products and services to support increased usage. Travel, especially airlines, will likely take longer to recover with less potential business travel.

Times like these (with more unknowns) are often accompanied by market volatility. However, history and the markets favor those who demonstrate consistency, discipline and patience. At Security National Wealth Management,  our charge is to invest for the long-term expansion of the global economy. Portfolios under our care will remain fully invested, broadly diversified and attentive to valuations. To see how these and other trends may impact your investments, contact one of our financial professionals today.