Pfizer announced positive results from its potential Covid19 vaccine on Monday with >90% efficacy in patients. This coupled with the news of Joe Biden's election caused the stock markets to move up.
However, stocks of Zoom, Amazon & Netflix took a sharp dip on the same day with Zoom closing 18% lower (25% dip in 2 days)! Many supporters of in-office work took to social media saying this indicates popular sentiment that remote work won't stay after the launch of a vaccine.
'We will go back to our earlier ways of working' couldn't be further from the truth. Former IBM CEO, Ginnit Rometty, believes the same and said that remote work is here to stay even after the pandemic.
Here's why the shift to remote work is permanent:
Remote work is fundamentally a technology trend
Remote working isn't new and was primarily driven by advances in technology & tools before 2020. The pandemic just gave it a huge push fast forwarding what would happen a decade later to just a matter of days.
"I don’t think these technology trends are going to reverse themselves", said Rometty.
Rightly so. And this doesn't just apply to remote working but also to say, dominance of digital content & platforms like Netflix or Amazon Prime. People aren't going to suddenly stop viewing content on digital platforms because the content there is fundamentally good.
Many tech companies have already committed to a hybrid or fully remote future
It is common knowledge now that big tech firms like Twitter, Shopify, Reddit, Microsoft etc. have already made plans for a hybrid or fully remote model. Many companies have cancelled their office lease by paying huge amounts. There's a large scale movement from tier-1 cities to tier-2 cities or towns and consequently, dip in real estate prices & rents in cities. All of these things aren't temporary but sustained, long-term trends.
Don't be fooled by the numbers
Stocks moving up or down in a single day isn't an accurate measure of a long-term & broad trend like remote work. Zoom's stock grew by 600% in 2020 before that dip happened. The price is naturally inflated and it might just course correct post the pandemic.
Not every single person will be working from their home or remotely as in 2020. However, many people would, for most of the time.
Here's what our users had to say:
Ashley Thomas said "It's quite a dip for Zoom given this is just news about early results of the vaccine 🤯 However, agree that it's quite an exaggeration to say remote work will vanish or everyone will just rush to office after the pandemic. We know, to an extent, that remote work will have a lasting impact and many companies will embrace it. Although a large chunk will still return to office."
Mark Walter said "Haha, 600% rise for Zoom was always outlandish. I knew a dip would happen but didn't expect it so early. Stock markets sure operate in a funny way 😂"
Shehan Perera said "I don't think anyone was convinced with Zoom's stock growing by 600%, it was not going to sustain in anycase. But IBM CEO, Ginnit Rometty is right about remote work being fundamentally a technology trend. This is what Creately Co-Founder & CEO, Chandika Jayasundara envisioned years back. His vision led to the "remote first" work culture for Creately employees. Remote work should be strategy that every company needs to now look at seriously, not only tech companies. Non-tech companies need to figure how to sustain operations in future with hybrid work strategies for employees. It is at their own peril to consider this a passing phase."
Hrishikesh Pardeshi said "Non-tech companies need to figure how to sustain operations in future with hybrid work strategies for employees. It is at their own peril to consider this a passing phase. True words. I am honestly very surprised that people can't see the obvious. Disregarding remote work a year or two earlier was still only a disadvantage vs. your peers. Right now & moving forward, it might create questions of existence particularly in the tech industry."
Ermira Krasniqi said "Good point. It was previously under the assumption that only tech companies can easily switch to remote working, but now the pandemic has pushed the non-tech companies to rethink their strategies and identify tasks that can be carried out remotely."