Covid-19 briefing

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- ECONOMIC IMPACT -

Latest update: 20 January

World Bank forecasts global economic growth at 4% in 2021 as vaccine rollout becomes widespread, following an estimated 4.3% contraction in 2020.

Chinese economy expands by 6.5%  in Q4 2020, taking the full year growth to 2.3% in 2020, according to National Bureau of Statistics.

-3.7%

Consensus forecast for world GDP growth in 2020

6.7%

Unemployment rate in the US in December 2020, unchanged from the previous month

Global real GDP growth

% change on previous year

2.6%

2.8%

-3.9%

Pre-Covid-19 2020 forecast

2019 average

Adjusted 2020 forecast

The cost of Covid-19

$375bn

Estimated monthly cost of the Covid-19 pandemic globally

$11tn

Cumulative loss for global economy over the next two years

- SECTOR IMPACT: technology -

Latest update: 8 January

GlobalData has analysed the impact of Covid-19 on the leading companies operating in 17 separate sectors within technology, media, and telecoms (TMT), with all TMT sectors negatively impacted by Covid-19 in 2020. IT services has been the hardest-hit subsector.

Some areas, including telecom services, some telecom infrastructure, and cloud-based solutions, are holding up well or growing. Operators moved forward CAPEX to support critical connectivity requirements and are restarting 5G, edge computing and other initiatives that had been put on hold or slowed down.

Sector indices

The technology and telecom market is holding up relatively well uner pressure. New product and service launches continue

Revenue predictions

Boeing and Airbus post unprecedented losses throughout the year, with last quarter being the worst on record for the global aerospace industry.


Defence is being used as a stimulus measure in markets with large domestic capacity, particularly the US, but there will be medium-term constraint due to fiscal pressures.

Enterprise technology & services 

  • Revenue impact varies across industries, with some sectors hit harder than others.
  • Cloud optimisation and migration engagements, as well as security related projects, are growing, but many other IT infrastructure and services projects have been postponed.
  • IT services hardest hit as projects are re-evaluated. IT services companies are re-skilling employees to adapt to shifting demand and cutting use of contractors.
  • Shift to homeworking sparks demand for collaboration tools, but there are associated cybersecurity risks.
  • Some enterprise technology companies are reporting executive pay reductions and scaled back recruitment, but wide-scale Covid-19-related job cuts have not yet materialised.

  • Apple, Samsung and many others have experienced significant supply chain disruption. Expect significant supply chain diversification in the medium term.

  • Enterprise IT saw a rapid and intense demand spike for networking and capacity services, collaboration software and cybersecurity.

Subsector impact

Industrial automation: moderate negative impact

Organisations will focus on automation in the medium term to help bridge the productivity gap. Industry 4.0 will have an important role to play to reduce potential infection vectors in the workplace. A greater investment in robotics and automation may prevent future plant shutdowns.


Cloud: moderate positive impact

Collaboration tools are the new growth area in cloud; remote working will continue long after lockdowns are lifted. Longer term, expect demand to be driven by an increase in use of IoT, requiring cloud capacity to store and process data.


Application software: significant negative impact

Spending on software will be hit as IT projects are put on hold. However, the market will slowly recover in 2021 and beyond. Collaboration tools are the one bright spot and tech providers are launching return-to-work solutions to help manage the challenges associated with employees returning to the office.

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