COVID-19 has affected the entire world. Governments were bound to take meticulous measures, and in turn, people had to stay at home or maintain social distance when they were out in public. The businesses took a stand and asked their employees to work from home. But this could not be applicable to all the industrial sectors. Just the IT sector could take such measures to provide economic support to the country.
COVID-19’s significant impact on the IT and technology sectors has affected it in the following way:
There has been a reduction in the supply of raw material. Businesses have seen disruption in the electronic value chain, which has caused inflation in the product prices.
The major IT section that has faced a setback in the year 2020 are:
- IT services
- Network equipment
#1 The Growth Of The IT Businesses Have Slowed Down
The super-fast growth in the IT field had to suddenly face a shock in the first quarter of the year 2020. Since then, the IT businesses have been losing their momentum. The employees were asked to stay at home and due to this, the work productivity got down drastically. Moreover, the business had to face project cancellation, compensation charges, and delays in getting the finished products. All these things lead to a 4% dip in the IT business revenue. Even the renowned business houses were not able to recover the dip in the second or third quarter of the year 2020. It had a great impact on the productivity and efficiency level of the employees as they were forced to meet the deadline with the limited manpower or working staff. The pandemic had stunted the optimistic growth of the IT industry.
#2 Cancelation Of The Grand IT Business Events
In accordance with the coronavirus government guidelines, most of the IT business houses have to cancel the major business events, gatherings, conferences. Some of them were able to conduct such events online, but they were not at all beneficial for the IT sector as before. Some of the important IT events that were put on hold were:
- Mobile World Conference 2020
- Game Developers Conference 2020
- MTN GlobalConnect
Besides the cancellation of the major events, the tech giants such as Facebook, Microsoft, Apple, Google, and more were asked to put off the annual business meets and yearly events. Such events had the potential to grow the IT market and increase the revenue of the communication and telecommunication sector. But with cancelation, the business could not take advantage of such opportunities and failed miserably.
#3 COVID-19’s Major Impact On The Small-Scale IT Business And StartUps
If we talk about the startups, some of which were completely dependent on the business funding had to shut down immediately. Whereas others were facing tough times managing the salaries for the existing manpower. The hiring process had entirely stopped and salaries were cut down to meet the financial resources for the business.
#4 The IT Business Faced Disruption In The Products Supply Chain
The manufacturing hubs had to undergo a decline in the manufacturing capacity due to a lack of manpower. And this in turn had a great impact on the revenue of the tech giants. The manufacturing sectors are trying extremely hard to regain the capacity with limited manpower, but it is extremely hard to predict whether they would be helpful in growing the fallen economy or business revenue. The drastic reduction in the products at the manufacturing unit has disrupted the supply chain, which in turn indicates severe revenue implications for the companies throughout 2020.
With such a great impact on the business revenue of the IT sector, the businesses are still being optimistic and working hard to formulate business strategies that would help in increasing revenue growth. They would be taking support from the telecommunication sector, which boomed during the pandemic. Due to the widespread of COVID-19, social distancing had limited the mobility of consumers, which led them to find alternatives to keep themselves occupied with some work. Once again, the giants like Facebook, YouTube, and Netflix saw a dramatic upsurge. So where some IT businesses have seen a loss, others maintained their growth trajectory.