Author Archives: Reuters News Agency

One U.S. company’s risky effort to build a new mask factory during COVID

By Timothy Aeppel

LA VERNE, Calif. (Reuters) – Dan Izhaky is betting $4 million that the pandemic will change what Americans are willing to pay for high quality face masks from his new factory here in this suburb of Los Angeles.

It’s a risky wager.

Before COVID-19 hit, the United States imported much of the personal protection equipment needed by health care providers, mainly from Asia. Some U.S. companies pivoted in the crisis, such as liquor companies churning out hand sanitizer and plastics firms making face shields.

But one item that remains in tight supply is N95 face masks, which provide a high level of filtration against airborne contaminants and are closely regulated by the U.S. government.

Izhaky is president of United Safety Technology Inc, a startup that is poised to open a new N95 mask factory possibly within weeks. While the plant is still being fitted with machinery, his goal is to make 1 million masks a day when it’s up and running. Izhaky said if they get approval from regulators soon, the plant could be shipping that amount by the end of the second quarter.

“The big question we face is what happens post-pandemic,” said Izhaky, “when you have a hospital administrator or whoever it is that’s in charge of purchasing” and looking at U.S.-made masks that cost more. The pricing of many types of protective equipment remain elevated by shortages, but once the market normalizes Izhaky estimates his masks will cost about 30% more than Chinese masks, or about $1.15 each.

Other domestic producers are likely to face the same challenge, including industry giants Izhaky will compete with. 3M Co has quadrupled its domestic production of N95 masks since the start of the pandemic, expanding a factory in South Dakota and hiring 300 workers and now makes nearly 100 million masks in the U.S. a month. Honeywell International Inc has opened “multiple new locations in the Phoenix area” to make N95 masks, said spokesman Eric Krantz, and converted a significant portion of a factory in Rhode Island that also makes safety glasses.

Krantz said Honeywell doesn’t view the expansion as a risk.

“We’re confident there will be continued demand for high-quality respiratory protection products,” he said in an email. “We’ve made smart, strategic investments in expanding our N95 production.”

But many smaller producers aren’t so sure.

“China subsidizes their face masks,” so every producer faces a challenge in competing with China after the pandemic, said Vitali Servutas, CEO of AmeriShield, which built a factory that makes single-use surgical masks, not N95 masks, in Virginia last year in response to the crisis.

Izhaky hopes, but is not certain, that the pandemic will make Americans more willing to pay a premium, or that U.S. government policy will mandate more domestic sourcing which would benefit his venture. Actions by the incoming administration of President Joe Biden, including an executive order aimed at increasing the production of a wide range of goods in domestic factories through Buy American programs, have made him more optimistic.

David Sanford, the brigadier general who directs the supply chain advisory group at the Department of Health and Human Services working on COVID-19 response, has been helping Izhaky and other manufacturers work through the process of getting certified and connected to domestic distributors of medical goods. He said Izhaky’s new factory is exactly the kind of project the U.S. needs to encourage.

“But there’s always a risk,” said Sanford. He adds there are ways the government can support businesses like this, short of giving direct government contracts to purchase goods at higher prices. A requirement to buy U.S.-made protective equipment could be built into Medicare and Medicaid reimbursements, for instance.

Making masks isn’t that hard. The process is highly automated and doesn’t require a costly cleanroom. But getting a dependable supply of the materials, particularly the specialized layers of filtration material that makes them effective, is a challenge.

“You can buy a face mask machine for a few hundred thousand dollars and start it up in 90 days. That’s happening all over the world,” said Sara Greenstein, CEO of Lydall Inc, a U.S. producer of the material that has agreed to supply Izhaky’s operation.

Lydall, aided by federal funds provided early in the crisis, has nearly tripled capacity at its one U.S. plant capable of making the material. With competing Chinese material expected to continue to sell at much lower prices after the pandemic, Lydall CEO Greenstein has “high confidence” there will be government-led programs in the United States and Europe “to buy product made here to help keep that supply chain stable and competitive.”

At the United Safety Technology plant in La Verne, engineers are busy fine tuning the first of the machines that will eventually turn out cup-shaped masks.

Edward Zheng, Izhaky’s partner in the venture, said their goal is to source all the materials domestically, with a key exception: the machines that make the masks in the factory are imported from China.

(Reporting by Timothy Aeppel; editing by Dan Burns and Edward Tobin)

U.S. Senate passes budget plan to advance Biden’s $1.9 trillion COVID aid package

By Richard Cowan

WASHINGTON (Reuters) – President Joe Biden’s drive to enact a $1.9 trillion coronavirus aid bill gained momentum on Friday as the U.S. Senate narrowly approved a budget blueprint allowing Democrats to push the legislation through Congress in coming weeks with or without Republican support.

At the end of about 15 hours of debate and votes on dozens of amendments, the Senate found itself in a 50-50 partisan deadlock over passage of the budget plan. That deadlock was broken by Vice President Kamala Harris, whose “yes” vote provided the win for Democrats.

This was a “giant first step” toward passing the kind of comprehensive coronavirus aid bill that Biden has put at the top of his legislative agenda, Senate Majority Leader Chuck Schumer said.

Shortly before the final vote, Democrats flexed their muscles by offering an amendment reversing three earlier votes that Republicans had won.

Those had used the coronavirus aid battle to voice support for the Canada-to-United States Keystone XL pipeline that Biden has blocked and support for hydraulic fracking to extract underground oil and natural gas.

Also overturned was a Republican amendment barring coronavirus aid to immigrants living in the United States illegally.

With Democrat Harris presiding, she broke a 50-50 tie to overturn those Republican victories.

It marked the first time Harris, in her role as president of the Senate, cast a tie-breaking vote after being sworn in as Biden’s vice president on Jan. 20.

Before finishing its work, the Senate approved a series of amendments to the budget outline, which had already passed the House of Representatives on Wednesday. As a result, the House must now vote again to accept the Senate’s changes, which could occur as early as Friday.

For example, the Senate added a measure calling for increased funding for rural hospitals whose resources are strained by the pandemic.

Senate Democrats and the Biden administration have said they want comprehensive legislation to move quickly to address a pandemic that has killed more than 450,000 Americans and left millions jobless.

They want to spend the $1.9 trillion to speed COVID-19 vaccines throughout the nation. Other funds would extend special unemployment benefits that will expire at the end of March and make direct payments to people to help them pay bills and stimulate the economy.

They also want to send money to state and local governments dealing with the worst health crisis in decades.

But as the hours wore on and dozens of amendments were offered, exhausted senators mainly spent the night disposing of Republican ideas, such as ending all U.S. foreign aid and prohibiting Congress from expanding the U.S. Supreme Court beyond its current nine justices.

RANGE OF ISSUES

Senators voted on issues ranging from immigration and abortion to energy and taxes. But none of the approved amendments will carry the force of law in a budget blueprint and mainly are guidelines for developing the actual coronavirus aid bill in coming weeks.

More importantly, the budget plan unlocks a legislative tool called reconciliation that is designed to let Democrats approve Biden’s $1.9 trillion proposal by a simple majority.

Most legislation must get at least 60 votes in the 100-seat Senate to advance. But the chamber is divided 50-50 and Republicans oppose the Democratic president’s proposal. Reconciliation would allow the Senate’s 48 Democrats and two independents who align with them to approve the relief package, with a tie-breaking vote from Harris.

Republicans have countered the budget plan with proposals that would be less than one-third the cost. While their plan dovetails with the Democrats’ in some respects, Biden has deemed it as too anemic to put the country back on its feet after a year of suffering through the pandemic.

A group of 10 Republican senators who met with Biden at the White House on Monday sent him a letter on Thursday saying that significant amounts of money already appropriated by Congress have not yet been spent.

Last year, Congress passed emergency bills totaling around $4 trillion to deal with the health and economic crisis caused by the COVID-19 virus.

In early voting on Thursday, senators delivered a message to the Biden administration that direct payments should be tailored to those who need the money the most, as it voted 99-1 to recommend that high-income earners not qualify for a new round of government checks that could amount to $1,400 for individuals.

Senators did not specify income limits. But an earlier round of direct payments placed thresholds of $75,000 for individuals and $150,000 for married couples before the money would start scaling down.

“The decent compassionate thing is for us to target the relief to our neighbors who are struggling every day to get by” during the coronavirus pandemic, said Democratic Senator Joe Manchin, author of the proposal.

(Reporting by Richard Cowan; Editing by Angus MacSwan)

McKinsey to pay $600 million to settle with U.S. states over opioid crisis role

By Jonathan Stempel and Nate Raymond

(Reuters) – Consulting firm McKinsey & Company on Thursday said it has agreed to pay nearly $600 million to resolve investigations by most U.S. states into its alleged role in “turbocharging” sales of opioids, fueling a nationwide epidemic.

McKinsey struck a $573 million settlement with 47 states, the District of Columbia and five territories which will go toward opioid treatment and prevention. It reached separate deals with Washington state and West Virginia that boost the total.

The states alleged that McKinsey contributed to the opioid crisis by helping drug manufacturers including OxyContin maker Purdue Pharma, owned by Sackler family members, design marketing plans and boost sales of painkillers.

“They were part of a machine that disrupted, in fact destroyed, lives and families in America,” said California Attorney General Xavier Becerra, President Joe Biden’s nominee to lead the U.S. Department of Health and Human Services.

McKinsey, which did not admit wrongdoing, must also turn over internal documents concerning its work. It will continue investigating whether employees, including two partners, tried to destroy documents in response to probes.

“We deeply regret that we did not adequately acknowledge the tragic consequences of the epidemic,” McKinsey Global Managing Partner Kevin Sneader said in a statement.

Purdue filed for bankruptcy in 2019 as part of a proposed settlement it valued at $10 billion to resolve lawsuits alleging its painkiller marketing helped fuel the epidemic. It pleaded guilty in November to related criminal charges.

More than 3,300 lawsuits are pending, largely by states and local governments, seeking to hold drug makers and distributors responsible for an opioid addiction epidemic that according to U.S. government data resulted in 450,000 overdose deaths from 1999 to 2018.

The states and localities have also been negotiating $26 billion in settlements with distributors Cardinal Health Inc, McKesson Corp and AmerisourceBergen Corp and drugmaker Johnson & Johnson.

(Reporting by Jonathan Stempel in New York and Nate Raymond in Boston; Additional reporting by Tom Hals in Wilmington, Delaware; Editing by Chizu Nomiyama and Bernadette Baum and Kirsten Donovan)

Canada’s Trudeau says scope for closer U.S.-Canada integration on EVs, critical mineral supply

By Steve Scherer

OTTAWA (Reuters) – Canada and the United States can collaborate more closely on manufacturing electric vehicles and on supplying critical minerals needed to make batteries for cars and other clean technologies, Prime Minister Justin Trudeau said on Thursday.

“The integration of our economies, of our supply chains … I think gives a real opportunity for us to really take some leaps forward,” Trudeau said in a telephone interview.

After noting that Canada has many of the rare earths minerals needed for car batteries and solar panels, Trudeau said it was important to have “a secure supply from a friend and an ally”.

China has been one of the main suppliers of critical minerals to the United States, and Biden is planning to mandate a review of critical U.S. supply chains with an eye to securing U.S. industrial supplies, Reuters reported earlier this week.

Canada’s mineral wealth “is part of why so many automakers are now looking at setting up their supply chains for zero emission vehicles in Canada,” Trudeau said.

General Motors Co, Ford Motor Co and Stellantis NV have all announced plans to manufacture electric vehicles in Canada in coming years.

“We’ve already seen something like $6 billion worth of investment by auto companies in Canada over the past couple of years into zero-emissions or low-emissions vehicles,” Trudeau said.

“There’s a lot of really great opportunities to be developing partnerships and production facilities not just for the North American market, but for the world,” he added.

(Reporting by Steve Scherer; Editing by Daniel Wallis)

U.S. court upholds Trump’s national security tariffs on steel imports

WASHINGTON (Reuters) – The U.S. Court of International Trade on Thursday upheld former President Donald Trump’s “Section 232” national security tariffs on steel imports into the United States, issuing a decision denying a steel importer’s challenge to the duties.

A three-judge panel at the New York-based federal court which hears challenges to trade actions said the tariffs, imposed in 2018, were legal under a Cold War-era national security trade statute, denying the request by New Jersey importer Universal Steel Products Inc to remove them.

(Reporting by David Lawder; Editing by Chris Reese)

Biden set to accept more refugees

By Steve Holland and Ted Hesson

WASHINGTON (Reuters) – U.S. President Joe Biden will issue an executive order to build up the country’s capacity to accept refugees, national security adviser Jake Sullivan said during a White House briefing on Thursday, but the timing of the action remains unclear.

White House Press Secretary Jen Psaki said later in the briefing that she did not expect Biden to issue the order on Thursday, but that Biden is “committed to looking for ways to ensure more refugees are welcomed into the United States.”

Biden has pledged to restore the United States’ historic role as a country that welcomes refugees from around the world after four years of cuts to admissions under former U.S. President Donald Trump. The U.N. High Commissioner for Refugees (UNHCR) estimates there are 1.4 million refugees worldwide in urgent need of resettlement.

During his presidency, Trump portrayed refugees as a security threat and a drain on U.S. communities as he took a series of measures to restrict legal immigration. The Biden administration is confronting a refugee program hobbled by Trump’s hardline policies, which led to the closure of resettlement offices and disrupted the pipeline of refugees to the United States, a situation exacerbated by the coronavirus pandemic.

Biden was expected to issue the refugee order in conjunction with a speech on Thursday at the U.S. State Department that aims to reinvigorate the workforce there, but the order was delayed, according to one person familiar with the plan. The reason for the delay was not clear.

Biden vowed on the campaign trail to raise the annual refugee ceiling to 125,000, up from a record-low 15,000 set by Trump for this fiscal year.

Biden eventually plans to raise refugee levels this year, but the target will be lower than his goal of 125,000, according to two people familiar with the matter.

(Reporting by Alexandra Alper, Steve Holland and Ted Hesson in Washington, Editing by Franklin Paul and Aurora Ellis)

Biden to name special Yemen envoy, end support for Saudi-led coalition, aide says

By Jonathan Landay and Jarrett Renshaw

WASHINGTON (Reuters) – U.S. President Joe Biden on Thursday will announce a new special envoy for Yemen and an end to U.S. support for the Saudi-led coalition’s offensive operations in that country’s civil war, White House national security adviser Jake Sullivan said.

The moves show that Biden plans to intensify the U.S. role in diplomatic efforts to close out the grueling conflict between the Saudi-backed government and the Iranian-align Houthi movement that has created the world’s worst humanitarian crisis.

Biden “is going to announce an end to American support for offensive operations in Yemen,” Sullivan told a White House briefing. “That is a promise he made in the campaign that he will be following through on.”

Sullivan also said that Biden would name a new special envoy for Yemen, but he did not disclose the person’s name. A source familiar with the matter said the U.S. president was expected to tap veteran U.S. diplomat Timothy Lenderking for the new post.

HUMANITARIAN CALAMITY

The end of U.S. support for the Saudi-led coalition’s offensive operations does not extend to efforts to neutralize al Qaeda’s regional affiliate, Sullivan said.

“It extends to the types of offensive operations that have perpetuated a civil war in Yemen that have led to a humanitarian crisis,” he said.

The new U.S. administration, he noted, already has halted two sales of precision-guided munitions and kept regional allies in the region informed of actions to avoid surprises.

The civil war in Yemen has claimed tens of thousands of lives, including large numbers of civilians, and left 80% of the country’s 24 million people in need, according to the United Nations.

The Saudi-led coalition intervened in March 2015 on the side of the government and enjoyed the backing of the Trump administration, with the war increasingly seen as a proxy conflict between the United States and Iran.

But the mounting civilian death toll and growing humanitarian calamity fueled demands by Republican and Democratic lawmakers for an end to U.S. support for Riyadh.

Biden pledged during the 2020 presidential campaign to curtail U.S. support for Saudi Arabia’s military campaign, including arms sales.

The U.N. has been struggling to broker peace talks between the government and the Houthis, an effort that Lenderking likely would be tasked to boost.

“Any move that reduces the number of weapons, military activity, is to be welcomed and will give more space and more hope not only to the (peace) talks, but importantly more hope to the people of Yemen,” U.N. spokesman Stephane Dujarric said.

The State Department is reviewing the Trump administration’s designation last month of the Iran-aligned Houthi group as a foreign terrorist organization.

The United States last week approved all transactions involving Yemen’s Houthi movement for the next month as it carries out the review. But the United Nations is still hearing concerns that companies are planning to cancel or suspend business with Yemen despite the move.

The U.N. and aid groups have called for the designation to be reversed, warning it would push Yemen into a large-scale famine.

(Additional reporting by Michelle Nichols at the United Nations; Editing by Alistair Bell and Paul Simao)

U.N. Security Council calls for release of Myanmar’s Suu Kyi

(Reuters) – The United Nations Security Council called for the release of Myanmar’s leader Aung San Suu Kyi and others detained by the military and voiced concern over the state of emergency, but stopped short of condemning this week’s coup.

U.S. President Joe Biden’s administration is meanwhile considering an executive order in response to the coup that could include some sanctions, national security adviser Jake Sullivan said.

Myanmar’s long and troubled transition to democracy was derailed on Monday when army commander Min Aung Hlaing took power, alleging irregularities in an election last November that Suu Kyi’s party won in a landslide.

The 15-member U.N. Security Council said in a statement agreed by consensus on Thursday that they “stressed the need to uphold democratic institutions and processes, refrain from violence, and fully respect human rights, fundamental freedoms and the rule of law.”

Language in the statement was softer than that originally drafted by Britain and made no mention of a coup – apparently to win support from China and Russia, which have traditionally shielded Myanmar from significant council action. China also has large economic interests in Myanmar.

A spokesperson for China’s U.N. mission said Beijing hoped the key messages in the statement “could be heeded by all sides and lead to a positive outcome” in its neighbor.

Reuters was not immediately able to reach the Myanmar government for comment.

Nobel Peace laureate Suu Kyi, 75, has not been seen since her arrest. Police have filed charges against her of illegally importing and using six walkie-talkie radios found at her home and she has been detained until Feb. 15.

Some 147 people have been detained since the coup, including activists, lawmakers and officials from Suu Kyi’s government, Myanmar’s Assistance Association for Political Prisoners (AAPP) said.

At least four people were arrested on Thursday, including three who took part in a street demonstration and a teenager who was banging a pot in part of what have become nightly protests against the coup.

In a country with a bloody history of crackdowns on demonstrations, there has been no mass outpouring of opposition on the streets.

But doctors have helped spearhead a campaign of civil disobedience that has also been joined by some other government employees, students and youth groups.

“UNFAIR COUP”

“Lights are shining in the dark,” said Min Ko Naing, a veteran of past campaigns against military rule, in a call to action. “We need to show how many people are against this unfair coup.”

In the face of the dissent, Myanmar’s junta blocked Facebook on Thursday, trying to shut off an important channel for opposition. Demand for VPNs surged over 4,000% as people sought to defeat the ban.

The Ministry of Communications and Information said Facebook would be blocked until Feb. 7, because users were “spreading fake news and misinformation and causing misunderstanding”.

Hlaing has moved quickly to consolidate his grip on power. He told a business group on Wednesday night he could remain in charge for six months after a one-year state of emergency ends in order to hold fair elections.

But in a show of defiance to the generals, about a dozen lawmakers from Suu Kyi’s party convened a symbolic parliamentary session on Thursday.

Among the steps the Biden administration is looking at are targeted sanctions on individuals and on entities controlled by the military, national security adviser Sullivan told a news briefing.

The daughter of the former British colony’s independence hero Aung San and the longtime leader of its democracy movement, Suu Kyi spent about 15 years under house arrest between 1989 and 2010. She was awarded the Nobel Peace Prize in 1991.

She remains hugely popular at home despite damage to her international reputation over the plight of Muslim Rohingya refugees.

The NLD won about 80% of the parliament seats in the November election and trounced a pro-military party, according to the election commission. The army refused to accept the result, citing unsubstantiated allegations of fraud.

(Reporting by Reuters staff; Writing by Matthew Tostevin, Rosalba O’Brien and Stephen Coates; editing by Lincoln Feast, Angus MacSwan and Nick Macfie)

Vaccine passports: path back to normality or problem in the making?

By Natalie Thomas

LONDON (Reuters) – Governments and developers around the world are exploring the potential use of “vaccine passports” as a way of reopening the economy by identifying those protected against the coronavirus.

Those developing the technologies however, say such tools come with consequences such as potentially excluding whole groups from social participation, and are urging lawmakers to think seriously about how they are used.

The travel and entertainment industries, which have struggled to operate at a profit while imposing social distancing regulations, are particularly interested in a way of swiftly checking who has protection.

Among those developing passports are biometrics company iProov and cyber security firm Mvine which have built a vaccine pass now being tested within Britain’s National Health Service after receiving UK government funding.

iProov founder and chief executive Andrew Bud believes such vaccine passports only really need to hold two pieces of information.

“One is, has this person been vaccinated? And the other is, what does this person look like?”

You need only match a face to a vaccination status, you don’t need to know a person’s identity, he added.

Confirmation of patrons’ vaccination status could help the night-time economy, which employs some 420,000 people in the northern English city of Manchester, off its knees, experts say.

“We have to look at how to get back to normal,” said Sacha Lord, an industry adviser and co-founder of the city’s Parklife music festival.

While there have been experiments in socially distanced concerts and events over the last year, they weren’t financially viable, he said.

“A gig isn’t a gig or a festival isn’t a festival unless you are stood shoulder to shoulder with your friends.

“I don’t think we should be forcing people into the vaccine passports. It should be a choice. But on entry, if you don’t have that passport, then we will give you another option,” he added, suggesting the use of rapid result coronavirus tests.

Bud said vaccine certificates were being rolled out in some countries, and in the United Sates, some private sector health passes were being used to admit customers to sports events.

“I think vaccine certificates raise huge social and political issues. Our job is to provide the technology basis for making vaccine passports and certificates possible … It is not our place to make judgments about whether they are a good idea or not,” he said.

Potential issues could arise around discrimination, privilege and exclusion of the younger generation who would be last in line to be vaccinated, he said, adding he believed government was giving it careful consideration.

(Reporting by Natalie Thomas; Writing by Alexandra Hudson; Editing by Mike Collett-White)

Subsiding layoffs raise cautious optimism for U.S. labor market

By Lucia Mutikani

WASHINGTON (Reuters) – The number of Americans filing new applications for unemployment benefits decreased further last week, suggesting the labor market was stabilizing as authorities started to loosen pandemic-related restrictions on businesses.

Despite the signs that layoffs are abating, the weekly jobless claims report from the Labor Department on Thursday showed at least 17.8 million Americans were on benefits in mid-January, indicating that long-term unemployment was likely becoming entrenched. That could boost President Joe Biden’s push for the U.S. Congress to pass his $1.9 trillion recovery plan.

Treasury Secretary Janet Yellen told ABC’s Good Morning America that the massive stimulus plan was needed to overcome the economic pain caused by the COVID-19 pandemic.

“It’s too early to predict that this begins a strong reversal of excruciatingly high layoffs,” said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia. “Another round of stimulus is important.”

Initial claims for state unemployment benefits fell 33,000 to a seasonally adjusted 779,000 for the week ended Jan. 30. That was the third straight weekly decline. Economists polled by Reuters had forecast 830,000 applications for the latest week.

Unadjusted claims decreased 23,525 to 816,247 last week. Including a government-funded program for the self-employed, gig workers and others who do not qualify for the regular state unemployment programs, 1.165 million people filed claims last week, down from 1.243 million in the prior period.

Claims remain above their 665,000 peak during the 2007-2009 Great Recession, but well below the record 6.867 million last March when the pandemic hit the United States.

Part of the elevation in claims reflects people re-applying for benefits after the government in late December renewed a $300 unemployment supplement until March 14 as part of a pandemic relief package worth nearly $900 billion.

“The decline in new claims in recent weeks adds to the evidence that the worst months for the labor market could very well be behind us,” said Sarah House, a senior economist at Wells Fargo Securities in Charlotte, North Carolina.

Stocks on Wall Street were trading higher. The dollar rose against a basket of currencies. U.S. Treasury prices were mostly lower.

LAYOFFS SUBSIDING

Though January was the worst month since the onset of the pandemic, the decline in economic activity leveled off in the second half of the month amid signs of a peak in the recent coronavirus wave.

Data from Homebase, a payroll scheduling and tracking company, showed its measure of employees at work flattened out over the last two weeks of January, pausing the decline observed from December into January.

Other data on Thursday from global outplacement firm Challenger, Gray & Christmas showed planned job cuts announced by U.S.-based employers rose only 3.3% to 79,552 in January.

The claims report also showed the number of people receiving benefits after an initial week of aid dropped 193,000 to 4.592 million during the week ended Jan. 23. About 17.836 million people were on unemployment benefits on all programs in mid-January, down from 18.322 million in the first week of 2021.

Last week’s claims data has no bearing on Friday’s closely watched employment report for January, as it falls outside the survey period, which was in the middle of the month. Still, the signs of stability in other labor market measures support expectations that hiring rebounded in January after the economy shed jobs in December for the first time in eight months.

Hopes that the economy created jobs last month were boosted by reports on Wednesday showing rebounds in private payrolls and services industry employment in January. A survey this week also showed manufacturers hired more workers in January.

According to a Reuters poll of economists payrolls likely increased by 50,000 jobs in January after declining by 140,000 in December. In the wake of the fairly upbeat reports, Goldman Sachs lifted its payrolls forecast by 75,000 to 200,000.

But some economists are bracing for a second straight month of job losses in January. The Conference Board’s survey last week showed consumers’ perceptions of labor market conditions deteriorated further last month.

The economy has recouped 12.5 million of the 22.2 million jobs lost in March and April. The Congressional Budget Office estimated on Monday that employment would not return to its pre-pandemic level before 2024.

Economists were unperturbed by a separate report on Thursday from the Labor Department showing worker productivity dropped at a 4.8% annualized rate in the fourth quarter. That was the deepest pace of decline since the second quarter of 1981 and followed a 5.1% pace of expansion in the third quarter. The pandemic has caused wild swings in productivity.

“This decline came after very strong productivity growth in the middle quarters of the year, and we think that the pandemic has led to a shift in economic activity away from some low-productivity sectors that has led to firming in productivity growth through some of the noise in the quarterly readings,” said Daniel Silver, an economist at JPMorgan in New York.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao)