Freelance Boomer

Covid-19 (Coronavirus) is an unforgettable name for people in 2020, because it is not just a medical crisis, but social and economic as well. It burst at the first half of the year and the effect is expected to be prolonged to the next half. Since the lockdown, sad news tightly follows with share market collapse, prediction of massive retrenchment and companies around the world facing the same unavoidable major issue - cash flow. We had the biggest player of shirt maker fall down, airlines depending on country support to survive, famous hotel close up and even long historical standing fast food restaurant declaring bankruptcy. Will little business fellow been excluded?

What does this eventually bring? Dry dock of people around the world.

U-N-E-M-P-L-O-Y-M-E-N-T

In Malaysia, it has been estimated about 10% of retrenchment for SME, which is around 1 million people might lose their current job, not including the recent break news of those big companies. We know when a company closed down, workers lost their job. These workers will have no income, and if they have no savings, they will have living issues. They have family need to feed, bills to pay. And if unemployment dragged for 6 months or more, they will defer on the loan repayment, houses and cars will be confiscated, bankruptcy is the next step.

Is it the end of the story? I believe not.

The downturn does not always mean the end, it is the shuffle of market focus and the beginning of a new era. Human is gifted with the ability to adapt and learn, we learn how to survive, we learn from a past mistake like a mirror, and most importantly we learn to think. Unemployment could be a good initiative to start thinking about starting a business, if we understand employment will never be forever, we will find a way to save our living. And I predict Covid-19 will be the trigger for the transformation of workforce market, is FREELANCE BOOMER time. Let me explain my view in details.

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1st | Company closed down

When a crisis like Covid-19 happens, company chooses to close down. Few reasons behind the move, it could be the traditional business which has a lower profit margin, with a high fixed cost, closing down the company is definitely a better solution than to struggle it through. It could be insufficient capital to fund the operations, the rental, the salaries and storage cost. Businessman will take into consideration for bad debts recoverability and foreseeable sales in the coming months, will it be better to save the “bullet” by chopping off the company expenses now.

2nd | Unemployment

Company save cost by layoff employee, which constitute a major part of a company monthly constant expenses. Is hard for the employee to look for another job because his skilled industries are in similar situation. They can barely find a job, and even if they do, they could be forced to accept a much lower pay job. People will now consider whether to wait, eating into their savings, or start with part-time job. And many will then start off with one-man show business, being a Freelancer.

3rd | Reduction in spending or increase in income

There are two ways people can adapt to sustain through the hardship, spending low or earning more. Spend wiser and lesser, cut off unnecessary expenses, careful in investment. However, the effect of the virus is unknown for its depth and length, with minimum spending will eventually eat into the savings and drained off soon. The better solutions are to look for income, people will be willing to take on a part-time job, or eventually start small trading, with friends or family. Estimate the loss that can be absorbed and set a plan to start a business, begin as a Freelancer is a safer choice.

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Based on the 3 explanations above, either the business owner or the employees, they eventually need to make a decision on whether to make changes. Workforce deem to be affected and setting up something that is controlled in our hand is always safer, either full-force or a backup plan.

In summary, a change of workforce in the market is most likely to happen. Think thoroughly, reposition yourselves and swim with the flow of transition.