Where for many hospitality companies maintaining 1.5-metre distance will hardly be possible in the future, it will be easier to implement in industry. ABN AMRO expresses this expectation in its new sector report 'Entrepreneurship in times of corona'.
Shrinkage in industrial production
In the report, the bank discusses the impact of the corona crisis on, in this case, the manufacturing industry. It issues a forecast that assumes the Dutch economy will shrink by 3.8%. ABN AMRO expects industrial production to fall by 10% by 2020. The industrial sector is particularly affected in the following three areas:
- A supply shock due to production stoppage at suppliers.
- Lower production due to less supply of labour because of higher absenteeism and migrant workers leaving.
- Drop in demand due to 'lockdowns', closed factories of buyers and sharply declining confidence and
willingness to invest among entrepreneurs and consumers
A plus point, according to the bank, is that the commandment to keep 1.5 metres of distance is easy to implement in many industrial companies and the direct impact on production processes is limited. "Factories tend to be spacious and many machine tools operate automatically or can be controlled remotely," ABN AMRO said. Setting up shifts without shift transfers, disinfection breaks for tools, changing clothes at home, adapting internal routing (e.g. one-way traffic on walkways), installing screens and phasing lunch and coffee breaks can also help monitor the 1.5-metre distance.
Looking ahead
While the bank understands that entrepreneurs are now mainly concerned with taking measures around the corona crisis, it says it is also important to look ahead. To this end, it makes some short- and long-term recommendations. A handy table also shows the impact on different industry sectors and where their opportunities lie.
You can read the report here.
