November 25, 2020

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Tech Industry Feels Increasing Impact of Coronavirus Outbreak

Coronavirus Outbreak Impact on Tech Industry

Many large tech companies are facing new challenges due to the outbreak of the Coronavirus in China. The virus is spreading from one country to another and is worrying not just for governments, but also for industries such as the tech sector.

Tech companies have closed stores and offices, restricted executives and workers from traveling to the country and warned about the potential effects on their supply chains.

The Chinese government has barred people from leaving Wuhan and Hubei, the provinces surrounding it, and severely restricted them from moving around in public — measures that have forced most industrial production to stop in the province.

Loss Of Revenue Predicted

Producers of smartphones and other consumer electronics could face loss of revenue and productivity due to workers told to stay home and factories shut by government order.

Major Tech Organisations Closing Business Operations and Restrict Business Travel

Apple
The iPhone maker has temporarily shut all of its stores in mainland China, one of its biggest and most important markets. Apple is also closing its corporate offices and contact centres in China until 9 February.

Google
Google has temporarily closed all of its offices in mainland China, Hong Kong and Taiwan due to the health threat. The tech giant has also placed restrictions on business travel to China and Hong Kong.

Microsoft
Microsoft has advised China-based employees to work from home and cancel all nonessential business travel until 9 February. It has also advised employees to avoid non-essential travel to China.

It has also said it will make a 1 million yuan ($144,000) donation to the Hubei Red Cross Foundation to help with relief efforts in Wuhan and surrounding areas.

Singapore Government Prepares to Support Industry Amid Outbreak

Governments around the world are also closely monitoring the situation as it evolves. Depending on how the virus situation progresses, the impact on economies could intensify.

In Singapore, Deputy Prime Minister and Finance Minister Heng Swee Keat announced that the Government will provide targeted support to the sectors that have been more directly affected.

The Singapore Government is prepared to support Singapore firms and workers in the event of a broad-based slowdown in the coming months, including a package of measures to help viable companies stay afloat and help workers stay in their jobs.

Even as the Government helps firms and workers get through this challenging period, the government has pledged it will continue to work together with tripartite partners to restructure the economy, build new enterprise capabilities, and upskill workers.

Virus Will Affect the Global Technology Industry as it has Struck the Largest Manufacturing Hub in the World

Travel restrictions to China are a significant burden for the companies, given the country’s role as the largest manufacturing hub in the world and a place where employees travel frequently.

The governments of six Chinese provinces, including manufacturing hubs crucial for the global technology industry such as Shanghai, Jiangsu, Guangdong and Chongqing, declared that the return to work after the Lunar New Year be delayed by a week to February 10 for all but essential industries.