How to Build a Resilient Business: Lessons From the Last Pandemic. What economics lessons can we learn from the 1918 pandemic, and what are successful businesses doing to survive the 2020 pandemic?

The difference between businesses that are able to weather the challenges of COVID-19 and those that will be caught permanently in its economical undertow may lie in business continuity planning, which is a fancy term for resilience. While some aspects of the novel coronavirus pandemic’s impact on economics are unique, business owners in other eras of unrest have also faced extreme situations, and then, much like today, the survivors were those that adapted.

Business observations from the 1918 influenza pandemic

Historical events are at the forefront of many people’s minds recently, as is often the case in periods of notable difficulty. But some economists have been concerned about a pandemic-related depression for years prior to the emergence of COVID-19.

In 2007, Thomas A. Garrett, assistant vice president and economist for the Federal Reserve Bank of St. Louis, wrote a report titled “Economic Effects of the 1918 Influenza Pandemic: Implications for a Modern-day Pandemic.” In it he seeks to outline the physical outcomes of the 1918 pandemic, in terms of spread of the disease and casualty numbers across different segments of society, as well as to “formulate a list of the likely economic effects of a modern-day influenza pandemic.”

Garrett, and other economists like him, have extensively studied financial reporting from the era of the 1918 pandemic (as there was not reliable data at the time on income, employment, etc.), and much of what they found is reminiscent of what’s happening today.

Firstly, Garrett points out that different regions responded very differently to the 1918 pandemic, and that the impacts were felt to widely varying degrees depending on location. The reason for greatly different mortality and infection rates was a matter of hot debate even at the time, with some positing that locations that were hit with the spread later (there were three waves of the pandemic, the second being the most deadly) were able to shut down schools and churches before outbreak spread extensively, thus mitigating damage.

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