As new risks spill into an economy already weakened by the COVID-19 pandemic, the International Monetary Fund (IMF) forecasts global growth to continue to slow in 2022. In its July 2022 World Economic Outlook (WEO) Update: Gloomy and More Uncertain, an update to its yearly WEO released in April, the IMF predicts growth to slow to 3.2% in 2022, revising its April forecast of 3.6% and down from 6.1% in 2021. After a shaky and slight recovery last year, risks identified in the April WEO, including the war in Ukraine, ballooning inflation, and economic slowdowns in China will continue to have adverse effects, the Update states.

It’s not all bad news; the economies of Brazil, Mexico, Colombia, and Chile have seen a more robust recovery than expected, contributing to an upward revision of 0.5 percentage points to projected growth in Latin America and the Caribbean. But globally, consumer prices have risen even faster than initially expected and inflation remains a chief concern. In the US and UK, inflation has reached its highest rate in more than 40 years, with the consumer price index rising by 9.1% in both the US in June and the UK in May when compared with a year earlier. Dismal consumer spending has caused the IMF to revise projected 2022 GDP for the US down 1.4 points to 2.3%.

Globally, inflation this year is expected to reach 6.6% in advanced economies and 9.5% in emerging market and developing economies, a bump of 0.9 and 0.8 percentage points, respectively, from the fund’s April projections. To address rising inflation, which has outpaced wage growth in both advanced and emerging market and developing economies, central banks in many countries have raised interest rates even higher than expected in April’s WEO.

Since April 2022, China’s zero-COVID policy led to lockdowns as outbreaks and new variants arose, pushing the country’s economy into a slowdown and resulting in supply-chain disruptions for the rest of the world. Shanghai entered a strict lockdown in April for 2 months, halting activity in many of the city’s semiconductor, electronics, and chemical manufacturing factories and disrupting activity at the world’s busiest port. The WEO warns future COVID-19 outbreaks could create further logjams for cargo moving through China’s ports and stop production in factories based in locked-down districts.

Lastly, the war in Ukraine continues to have cascading effects due to dependence on oil, gas, and metals exports from Russia, and Ukraine’s status as the breadbasket of Europe. Russia normally accounts for 10% of the world’s oil production, and Russia and Ukraine are together responsible for nearly 30% of the world’s wheat. The crisis has driven an inflation in global food prices, particularly prices of cereal grains. Russian gas exports to Europe have fallen to 40% of last year’s level, increasing crude oil prices, albeit at a rate slightly lower than the April WEO due to offsets made by OPEC. Overall, the WEO expects oil prices to increase by 50.4% in 2022 (with nonfuel commodity prices increasing by 10.1%). In the event of an unprecedented complete cut-off of Russian energy exports, the WEO predicts further inflation and a steeper deceleration global growth to 2.6% in 2022 and 2% in 2023, nearing 50-year lows, with shocks felt most acutely in Europe.

Combined, these factors could affect many end markets that intersect with the analytical instrument industry. Supply chain backups and higher energy prices could affect transport and costs of materials and products. Raised interest rates might hamper companies’ and institutions’ purchasing power for instruments. And for consumers, high prices of essentials like food and energy could curb large purchases or spending in discretionary categories, and less consumer spending could lead to a decrease in product testing. In all, the IMF positions the current economic outlook as “extraordinarily uncertain” due to the many shifting risks outlined in the WEO Update, but across the board, the prognosis is “gloomy.”

The pandemic shook up nearly every facet of modern life, including employees’ views of what they value at work. In a trend dubbed the “Great Resignation” or the “Great Attrition,” about 47.4 million workers quit their jobs in 2021, and more than 4 million people have quit their jobs each month this year. At the end of June (the latest month with available data), 10.7 million jobs were open in the US, down 5.6% from 11.3 million in May but up 9.2% from 9.8 million in June of 2021, according to the US Bureau of Labor Statistics.

And industries that rely on labs aren’t immune. The Bureau reported over 2 million healthcare and social services job openings and 790,000 manufacturing job openings at the end of June. As of July 22, job postings on the hiring platform Indeed.com are up nearly 68% for positions in scientific R&D, 78% for medical technicians, and 90.5% for positions in production and manufacturing compared with pre-pandemic levels in February 2020. Some large companies that profited during the pandemic expanded; for example, Johnson & Johnson grew 7.2% from 132,200 to 141,700 employees between 2019 and 2021.^* Other companies have seen their ranks decrease Pfizer’s numbers dropped 10.5% from 88,300 to 79,000 employees in the same time frame.

“We are suffering, along with the rest of the country, from the ‘where-are-the-workers’ syndrome,” says Jan Hudson, partner and CEO of Surf Search, a recruiting firm in San Diego, CA, that specializes in health care, medical devices, and the pharmaceutical and biotech industries. The pandemic is mostly to blame, Hudson says, and employees are now looking for remote work and other perks.

Before the pandemic, employers weren’t paying close enough attention to retention, says Chris Clancy, associate vice president and practice director in Life Sciences and Biotechnology at Boston, MA-based recruiting firm HireMinds. A report published in July by McKinsey & Company found that 54% of respondents working in healthcare or pharmaceuticals who quit their jobs between April 2020 and April 2022 did not return to that same industry, citing a lack of opportunities for career development or advancement and inadequate compensation as top reasons for quitting. Clancy says many employers are now desperate to fill spots at their lab benches.

For the candidates who stuck around the lab and are now looking for jobs, their wish lists are long. Ample time off and stock options are high on jobseekers must-have lists, Hudson says. But many prospective employees are looking for hybrid or fully remote work options above all, a tricky proposition for lab-based work. “You can’t culture cells from home,” Clancy says.

Because of the premium placed on remote work, “good lab hands are hard to find,” he says.

Even if a potential staffer is aware they’ll need to be physically at the bench, they often are looking for leadership to be in-person too, says Carla Yacoub, senior scientific recruiting associate at Boston-area firm Sci.bio Recruiting. “It may be a challenge for these companies to encourage their senior leadership to be on-site as much as they can,” she says.

Outsourcing wet lab work to CROs might play a growing role, says Aly Budny, senior marketing and scientific recruiting associate, also with Sci.bio. “Instead of executing experiments in a lab setting, scientists now design and troubleshoot experiments that are fully executed at a CRO, outside of their company’s lab,” she says, enabling them to work remotely.

Along with research associates and lab technicians, both Hudson and Clancy also see companies struggle to recruit bioinformaticians or other data scientists to their ranks. But while the pandemic has been hard on labs, Clancy points out that laboratories have proved now, more than ever, to be necessary. “These are the employees who were obviously essential in making the [COVID-19] vaccine and improving outcomes for antiviral pills,” he says. “The industry is still healthy and vital.”

^*According to our estimates, only about 9% of the increase in employee numbers is attributable to acquisitions.

The economic fallout from the war in Ukraine will reach far beyond the countries involved. In its April 2022 World Economic Outlook (WEO): War Sets Back the Global Recovery, the International Monetary Fund (IMF) cited the conflict as the primary reason for the slowing of global growth the institution now predicts. While recovery from the COVID-19 pandemic in 2021 was slightly stronger than expected, it is still in progress, with recent lockdowns in China slowing manufacturing and further disrupting supply chains. In addition, the prospect of new SARS-CoV-2 variants continues to pose a threat to the global recovery.

Anticipation of shortages in the wake of the Russian invasion of Ukraine has driven up commodities prices. The regions that will be most affected are the Caucasus and Central Asia, Europe, the Middle East, North Africa, and sub-Saharan Africa. Russia is a major global supplier of gas, metals, and oil. Russia and Ukraine are large producers of corn and wheat, together accounting for almost 30% of the worldΓÇÖs wheat exports. The price hikes of these commodities are anticipated to exacerbate inflation; the WEO has increased 2022 inflation projections for advanced economies, and emerging market and developing economies to 5.7% and 8.7%, respectively.

The consequences of the war to Ukraine’s economy are unsurprising—it will take years for the country to rebuild from the deaths, destruction, and fleeing of its people brought on by the invasion—and the WEO predicts a 35% plunge in the Ukrainian economy for 2022. Trade and financial sanctions will act to depress Russian GDP by 8.5%. Many European countries have begun to reduce their reliance on Russian energy, an act that will continue to affect the Russian economy beyond the short term. The war is expected to affect Europe most via higher energy prices, with emerging and developing European economies also experiencing trade disruptions. In advanced European economies, some industries already suffering supply-chain interruptions are predicted to be further hampered by the war and sanctions.

Higher food prices—especially that of wheat—restrict growth in the Caucasus and Central Asia, the Middle East, and North Africa. The Middle East and North Africa are also expected to be affected by a decrease in tourism. However, oil exporting countries will benefit from higher energy prices. On balance, the WEO anticipates 4.6% GDP growth for the Middle East and Central Asia, up 0.3 percentage point from the January projection. Similarly, the economy of sub-Saharan Africa is largely subject to the warΓÇÖs impact on food and fossil fuel prices. Although political and social unrest also depress the outlook for the region, its economy is nonetheless predicted to expand by 3.8% in 2022, 0.1 percentage point higher than forecast in January.

The main influence on the Asian economy continues to be China. Recent COVID-related lockdowns and restrictions, as well as weak urban employment recovery, have impaired manufacturing, trade, and private consumption in China. Real estate investment has also lost some of its momentum. For the Asian region as a whole, weaker demand and higher commodities pricing will slow growth.

Tightening monetary policy to counter inflation is predicted to suppress growth in North America, with war-related trade disruption and lower demand from the US also coming into play for the US and Canada, respectively. Latin America and the Caribbean are less tied to Europe but will also be subject to Inflation and tightening of financial policy.

With so much uncertainty in the state of international affairs, the WEO points out the challenges of making quantitative predictions for the world’s economy. Nonetheless, some means by which the war and sanctions will influence the global economy can be determined.