Notable switch to digital power in face of pandemic

THE Covid-19 pandemic is changing the way we live. That’s what many people feel.

The change has come about because of the rules on how we are to go about our daily activities. We are now in the thick of a changing lifestyle, and when the virus is eventually contained, will things be ever the same again?

Some circumspect people are doubtful if we will ever get back to normal. They speculate that, at best, we will be headed to what they call a new normal.

The painters of a gloomier picture of the future believe Covid-19 will be with us forever and the only way forward is to co-exist with the killer microbes in the hope that a vaccine can be found to subdue the invisible enemy just like humankind had done in several similar pandemics.

Undeniably, this latest pandemic has been very disruptive. Businesses have been jeopardised or ruined, workers’ wages reduced, and many people have lost their jobs.

Most people have suffered one way or another, the most severe being loss of income. Save for some lucky ones whose jobs are not affected and the few who have stumbled upon unexpected opportunities, the rest have found their lives in tatters with an uncertain future.

But when push comes to shove, people, in general, are quite resourceful. Driven to desperation, they would seek alternative ways to make ends meet — of course, precluding those who resort to crime.

The more initiated and venturesome recognise the propitiousness, created by the restrictions of movement, which has given rise to some new business and job opportunities, most notably the delivery and digital services.

In Malaysia, especially Sarawak, many young people have become runners for various services, and delivery persons, especially in the food business. We are witnessing some kind of proliferation of delivery riders for Grab, Foodpanda, KFC, McDelivery, Hungry, Pizza Hut, Lyfe, Yummi Hero, and Agrijoy Farm among others.

The services other runners offer range from collecting medicines from clinics to doing grocery shopping. There is also the mushrooming of all kinds of businesses accessible through the Internet of Things (IoT).

Extraordinary Grit

A survey by a global Internet company called SEA suggests that youth in Asean countries demonstrate extraordinary resilience and adaptability amid Covid-19 challenges.

SEA is a leading global consumer Internet company whose businesses include Garena, a leading global online games developer and publisher, Shopee, the largest pan-regional e-commerce platform in Southeast Asia and Taiwan and SeaMoney, a leading digital payments and financial services provider in Southeast Asia.

SEA’s findings are based on the 2020 Asean Youth Survey in collaboration with the World Economic Forum (WEF), claiming to have feedback information from some 70,000 young people aged 16 to 35 from six markets – Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam, through their Garena and Shopee platforms.

SEA also shared its findings with thesundaypost. The first thing they found is Asean youths have adjusted to the Covid-19 environment by significantly increasing their digital footprint. About 87 per cent of youths upped usage of at least one digital tool during the pandemic, while 42 per cent picked up one new digital tool.

Beyond just going digital, about 72 per cent of the youths have resorted to either picking up new skills, thinking creatively, or creating new income sources, thus, learning to be more resilient.

“With the challenges caused by the pandemic, Asean youths have displayed their resilience and adaptability, showing great promise for recovering and responding to future crises in the larger world of work,” said SEA group chief economist Santitarn Sathirathai.

They seem able to position themselves to be well-prepared for future pandemics, and surprisingly, girls are found to be not any less enterprising and ingenious in this area.

Feasible but not easy

Remote working or studying — or working or studying from home — is a feasible option to a certain extent but not as easy as it might sound.

According to SEA, 69 per cent find it difficult to work or study remotely during the pandemic, including 7 per cent who said it was impossible. Those lacking digital skills and access to affordable and quality Internet find it the toughest.

Digital Tools

The pandemic also seemed to raise awareness of the usability and helpfulness of digital tools. More than 60 per cent of the youths said they will permanently increase usage of key digital tools such as social media, e-commerce, online education, food delivery, and e-banking.

They believe that even after the virus has been brought under control, more digital tools will likely become an integral part of people’s lives and businesses. Many foresee digital economy playing an important role in supporting the recovery of the general economy.

“With the widespread shift in online lifestyles, we saw the rapid acceleration in digitalisation, further driving the demand for digital tools and skillsets,” Sathirathai noted.

But SEA found some stumbling blocks in this area — three key gaps related to digital skills, digital access, and funding to be bridged. And these domains, said SEA, require strong collaboration between the public, private, as well as the social sector.

The Internet company also found the most challenging aspects of remote working and studying facing Asean youths are the lack of digital skills, good Internet access, and financial ability which are the most binding constraints to remote working or studying.

The atmosphere is especially punishing to the gig economy in that the incomes of gig-economy workers and entrepreneurs fluctuate strongly with the state of the general economy.

SEA said large organisation employees are generally less exposed to such swings. Gig economy workers and entrepreneurs experience greater financing challenges as external sources of financing have become more important, but then, only a handful can rely on banks in times of needs.

Thus, youths tend to turn to their savings and family and friends for financial support first. Under such funding constraints, many are in greater need of government support.

Overall, SEA said Asean youths have adapted to the Covid-19 environment by increasing adoption of digital tools — and the digital footprint data they have acquired indicates an 87 per cent increase in digital tool usage during the pandemic, while 42 per cent picked up at least one new digital tool more or for the first time.

Larger Boost

Indonesia and Singapore generally show a larger boost to digital adoption. For instance, more than 50 per cent of youths in these two countries have increased e-commerce buying.

Online education also sees a surge of 38 per cent more users of education tools and 64 per cent of students use it for the first time. Over 70 per cent of users believe the increased usage of online education will last beyond Covid-19.

Meanwhile, many young entrepreneurs switch distribution channels and go online to increase sales. The increased adoption of e-commerce selling is highest among Indonesian entrepreneurs where one in four of those surveyed said they tried e-commerce more or were even using it for the first time.

Among the digital tools used are e-commerce selling, e-wallet, Online Banking, Enterprise Resource Planning, Food Delivery, and Ride-Sharing.

SEA also found that many Asean youths are inclined towards learning various new skills which reflect their different shades of resilience and adaptability. Entrepreneurs have even tried to develop new business models to improve their incomes.

This is especially so for those within the age range of 26 to 35 years. Women, in particular, said they had learnt more about the value of budgeting, having emergency savings, and more family time.

Generally, women have fared very well, if not better, than men during the pandemic in terms of entrepreneurship.

Some incidentally find their businesses doing even better if they can creatively adapt to the new economic environment. SEA found countless stories of such resiliency among women in Indonesia.

One of them SEA quoted as an example is Snack Mazter, a packaged food business owned by a couple, Sherly and William. They have been online for around four years, and also have set up offline shops.

When Covid-19 hit, their customers started panic-buying because they could not leave their house. Online sales surged for Snack Mazter.

To adapt to the new demand, Snack Mazter started selling granola cereal, a healthy food product. Its sales grew eight times, exceeding those of their traditional snacks during Ramadan.

However, one of their key challenges was meeting strong demand in the of supply chain disruptions during enforced movement restrictions.

As such, they had to wait longer than usual before getting their stock. Through live chat, they interacted more via online with their customers, and realised demand for healthy food was strong.

SEA findings also suggested most people see the digitalisation of the many aspects of life as the new normal which can play a key role to support post-Covid-19 economic recovery.

The new normal will thrive in a digital world.

It is as though Covid-19 has produced an effect in changing permanently how people use digital tools besides just increasing their usage of social media, e-commerce, online education, and e-banking. SEA has found an over 60 per cent increase in the usage of a digital tool in this area.

A Necessity

Going digital, therefore, is no longer a luxury but a necessity. Going digital can also bring about a significant and lasting economic turnover.

A SEA research has shown Asean SMEs, adopting e-commerce, see more than 160 per cent increase in total revenue (offline + online), driven by an increase in productivity. Before e-commerce, only about 36 per cent of the businesses sold outside their region, But after e-commerce, some 67 per cent now sell outside their region.

Gaining access to digital tools also creates a new breed of entrepreneurs and new income streams. Digital technologies such as e-commerce allow discovery of new income streams for different groups to become entrepreneurs. These include homemakers, students, full-time employees, and even retirees.

Through e-commerce, students have a valuable source of income to pay for their education. They can test out business ideas because of the ease in setting up a business at low cost.

For homemakers, they can make use of e-commerce profits to take care of the family. It is as if they are also participating in the labour market, yet can spend more time at home to look after the family.

For full-time employees who are mostly the main breadwinners, they can use e-commerce to earn extra income through low-cost and flexible businesses without jeopardising their main means of livelihood.

Drawing from the situation manifested by their research, SEA comes up with three recommendations where the public, private, and social sectors can collaborate to support Asean youths whom SEA has found to be full of potential because of their resilience, creative thinking and a venturesome spirit to try new things.

The first thing is to raise the digital skills of the youth. They need to have basic digital literacy to effectively employ digital tools as well as soft skills and growth mindset to thrive in a volatile world. Internet accessibility must also be improved.

In a more digitalised world, youths not only need Internet connection but also the ability to access quality Internet services at affordable prices. They can be helped with some forms of funding in their legitimate ventures.

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