The devastation of the coronavirus pandemic became more evident on Thursday with more than 5.2 million workers added to the unemployment count.
The latest Labor Department figure, reflecting last week’s initial jobless claims, brings the four-week total to about 22 million, about the net number of jobs created over the nine and a half year period that started after the last recession and ended with the arrival of the pandemic.
He points out how the downdraft has spread to all corners of the economy: hotels and restaurants, mass retailers, manufacturers and white-collar fortresses like law firms.
“There’s nowhere to hide,” said Diane Swonk, chief economist at Grant Thornton in Chicago. “This is the deepest, quickest and widest recession we have ever seen. “
Some of the new unemployment claims represent newly laid-off workers; others are from people who have been trying to testify for a week or more. “We continue to catch up on several fronts,” said Swonk.
Each day seems to bring unwanted steps. On Wednesday, the Commerce Department announced the largest monthly decline in retail sales since the start of record-keeping nearly 30 years ago, and the Federal Reserve said industrial production had registered its largest decline since 1946.
The growing number of unemployed seems certain to fuel the debate on the duration of the imposition of home stay orders and restrictions on business activity. President Trump has said that certain measures should be relaxed soon due to the impact on workers. “There has to be a balance,” he said at a press conference on Wednesday evening. “We have to go back to work.”
Facebook announced Thursday morning that it would start sending messages to people who liked, reacted or commented on false information about Covid-19 that the social network had deleted. The posts would also recommend credible information from the World Health Organization, the company said.
“As this pandemic evolves, we will continue to focus on the most effective ways to keep misinformation and dangerous hoaxes on Covid-19 out of our applications and to ensure that people have credible information provided by health experts to stay safe and informed, “Guy Rosen, vice president of Facebook president of integrity, said in a blog.
As the coronavirus has spread around the world, killing hundreds of thousands of people, so too has online misinformation about it, despite aggressive efforts by social media companies to limit its spread. Facebook said on Thursday that it had deleted hundreds of thousands of social media posts that “could cause imminent physical harm”, such as harmful allegations that bleach cures virus and that physical distancing measures are ineffective against its widespread transmission.
Yet conspiracy theories on the coronavirus abounded on the social network. In March, the company said it had also reduced the reach of around 40 million bogus messages and applied warning labels showing more context based on thousands of articles written by its independent verification partners. facts.
The global economy can be permanently changed, even after its recovery.
Who would have thought that a crisis that started with defaults in the American suburbs in 2007 would lead to a budget crisis in Greece in 2010? Or that a stock market crash in New York in 1929 would contribute to the rise of fascists in Europe in the 1930s?
In the years to come, we will learn what will happen when the infinitely complicated network of interconnections that makes up the world economy is torn apart. And that opens up the possibility of a world economy completely different from that which has prevailed in recent decades.
“This is a period of radical uncertainty, an order of magnitude greater than anything we are used to,” said Adam Tooze, historian at Columbia University and author of “Crashed,” a study of the vast global ripple effects of 2008. financial crisis.
Crises have a way of highlighting problems that are easy to ignore at the right time.
One obvious candidate is globalization, in which companies can move production to where it is most efficient, people can get on planes and go almost anywhere, and money can flow everywhere it goes. its maximum. The idea of a global economy with the United States at its center was already crumbling, between the rise of China and the United States’ own shift to nationalism.
There are signs that the coronavirus crisis is exaggerating and may even cement these changes.
US stock futures rose and European markets rose slightly on Thursday as investors digested new government and corporate figures on the economic damage caused by the coronavirus epidemic.
Futures for the S&P 500 signaled a rise in the opening of the markets.
Thursday brings a new wave of bad economic news. Weekly US unemployment benefit data released on Thursday morning showed yet another massive job loss, and more businesses were expected to report the blow to their financial results in the first three months of the year.
On Wednesday, the S&P 500 fell more than 2% as investors faced additional data showing the economic damage from efforts to contain the coronavirus pandemic, including a historic drop in retail sales and collapse of factory production.
Although still far from the record reached on February 19, stocks in the United States have risen steadily in recent weeks as investors have begun to focus on the prospect of a possible rebound from the pandemic-triggered economic collapse.
Volkswagen, Daimler and Volvo will reopen factories.
European automakers are starting to gradually reopen factories in what will be an important test of whether it is possible to revive the economy without endangering the health of employees.
Volkswagen, which has already restarted limited production in some parts factories, announced Wednesday that it will reopen car assembly plants in Zwickau, Germany and Bratislava, Slovakia on Monday. Other VW factories around the world will follow later in April and May.
Daimler, the maker of Mercedes-Benz cars and trucks, said that next week it would reopen three German factories that make vital parts, like a Berlin-made system that controls the valves of internal combustion engines. The factories will initially operate for one shift per day as Daimler gradually restarts operations in Germany, the company said.
Volvo Cars has announced that it will reopen its factories and offices in Sweden on Monday. Sweden has taken a more relaxed approach to the virus, allowing primary schools and restaurants to remain open.
More than a million Europeans are working reduced hours or are unemployed due to car and parts plant closings, so restarting factories is crucial. But factories will also be laboratories to determine if the risk of infection can be controlled by using face masks, plastic barriers and other measures.
A struggling Chinese conglomerate talks to investors about its debt problems.
As China’s economy grapples with the coronavirus epidemic, a reputedly indebted company illustrates the risks of the country’s dependence on borrowing.
HNA, a conglomerate that has borrowed a lot and run into trouble in recent years, blamed cancellations of virus-related flights across China and the world for mounting debt problems that prompted it to ask the Chinese government a bailout in February. This week, the insurance giant said the pandemic had brought it to “life and death.”
In one HNA apologized to investors, said it would be forced to skip regular payments on a bond, delaying interest and principal owed by one year. The company also gave insight into internal difficulties by posting an anonymous letter criticizing its own finance department for missing a hastily organized call to some of these investors.
HNA said not all investors were aware of the call. He promised to “disclose relevant information more openly and transparently” in the future.
Most economists expect Chinese economic data to drop in the first quarter.
For more than four decades, China has never recognized that its economy has actually shrunk, even during major economic crises. But that could change Friday, when the country announces its gross domestic product for the quarter from January to March.
The Chinese National Bureau of Statistics has already confirmed last month that domestic industrial production, retail sales and investment all suffered record double-digit declines in the first two months of this year compared to the same period in 2019. This prompted most, but not all, economists to guess that overall economic performance for the first quarter this year is down from the previous year.
The question is, how big will the drop be?
A survey of 18 Chinese and foreign institutions by Caixin, a Chinese news agency, revealed that they expected the economy to stabilize at 11.5% in the first quarter. The average forecast was 6.6%.
A larger Reuters survey of 57 analysts found an even wider range of forecasts – ranging from a 28.9% dive to a 4% gain. But the Reuters survey average, a loss of 6.5%, was almost identical to that of Caixin.
Foreign banks, which face only slightly less political pressure than Chinese institutions to issue sunny forecasts, tend to be at the lower end of the range.
United Airlines is warning its employees about a bleak future.
The leaders of United airlines On Wednesday, he wrote to the airline’s 100,000 workers, warning that staff cuts may take place and demand for air travel is expected to remain subdued next year.
“The challenge ahead for United is greater than that we have faced in our 94 years of pride,” wrote airline general manager Oscar Munoz and president J. Scott Kirby, in the letter posted on the company’s website.
Traffic in the first two weeks of April fell 97% from last year and the airline now plans to carry fewer passengers in May than in one day in the same month l ‘last year, the leaders wrote. And the decline is expected to continue even if health concerns persist and travel restrictions are lifted at different times around the world.
The airline said earlier Wednesday that it expects to receive $ 5 billion in federal funds to pay airline workers until September, but the stimulus should not prevent cuts beyond that, warned the leaders Thursday.
“The difficult economic outlook means that we have difficult decisions to make when we expect our airline and our overall workforce to be smaller than today, starting October 1,” they said. .
Leaders took a distinctly different tone from that of the CEO of American airlinesDoug Parker, who said in an interview with CNBC earlier today that he saw “indications that the world is ready to start traveling again.”
A computer, communication tools, entertainment and a good Internet connection are all the technologies most of us need to work and stay healthy while trapped inside our homes, says our Tech Fix columnist Brian X. Chen.
This means that we don’t have to spend a lot of money on the latest devices, although investing in a new router can dramatically increase the speed of your Internet connection.
This short list can guide our priorities in terms of technological consumption even after the end of this uncertain period. It also means that we don’t have to spend a lot of money to maximize our happiness with technology.
Technology you don’t need: this smart speaker from Amazon or Google or this phone with the foldable screen. If that doesn’t help you work, stay connected, and have fun, you can find other ways to spend your money.
Catching up: here’s what’s going on.
California Governor Gavin Newsom signed an executive order Wednesday ordering the state unemployment agency to pay workers benefits Uber and Lyft through a federal assistance program for the self-employed. He said the state would also provide assistance to undocumented workers, many of whom were unable to obtain federal assistance during the pandemic despite the payment of local and state taxes.
Amazon said on Wednesday that he would temporarily interrupt its operations in France after a court ruled that the company had not adequately protected warehouse workers against the threat of coronavirus and that it had to restrict deliveries to food, hygiene and medical products only until it solves the problem.
UnitedHealth Group, one of the country’s largest insurers, said its revenues had increased in the last quarter, adding that the costs of the pandemic had been offset by cancellations of routine medical appointments and elective surgeries.
The Paycheck Protection Program, a federal program to help small businesses overcome the pandemic, risks drying up due to disagreement between congressional leaders and the White House over how to rebuild it.
The reports were provided by Alexandra Stevenson, Davey Alba, Neil Irwin, Nelson D. Schwartz, Liz Alderman, Keith Bradsher, Niraj Chokshi, Caitlin Dickerson, Miriam Jordan Jim Tankersley, Emily Cochrane and Emily Flitter Reed Abelson, Sapna Maheshwari, Ben Casselman , Noam Scheiber, Carlos Tejada and Mike Ives.