Tag Archives: Job Losses

As the Federal Reserve tees up a series of interest rate increases Companies cut 301,000 jobs

Important Takeaways:

  • Companies unexpectedly cut 301,000 jobs in January as Omicron slams labor market, ADP says
  • As companies reported a drop of 154,000. Trade, transportation and utilities cut 62,000 while the other services category declined by 23,000.
  • Manufacturing also lost 21,000 positions, while education and health services reported a drawdown of 15,000 and construction fell by 10,000.
  • Service-providing industries were responsible for 274,000 of the job losses, with goods producers falling by 27,000.

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Strong retail sales boost optimism before U.S. election, but it may be short lived

By Jonnelle Marte

(Reuters) – In an ordinary presidential election, Friday’s retail sales report would have been a dream for an incumbent like Republican President Donald Trump. Headline sales topped expectations by a wide margin and spending was up from August in all but one of the major categories.

Still, this is no ordinary election. Despite the gains seen in September, spending in key sectors that suffered massive job losses during the pandemic, such as restaurants and clothing stores, remain deeply below last year’s levels.

The report from the Commerce Department offered a reminder that millions of Americans are still out of work, leaving them with less money to spend on dinners out or new outfits. Without a vaccine or effective treatment, many consumers also hesitate to head out to stores or restaurants where they may be exposed to the virus.

On the one hand, the retail report showed that overall retail spending is now above pre-pandemic levels. That is a sign that some people may have spent the $300 supplement the federal government temporarily added to unemployment benefits. Other people may have boosted spending after being called back to work.

If more people continue to see their finances improve, that could bode well for the economy and for the overall outlook people carry when they vote in the Nov. 3 election.

But some economists are also questioning whether the increase in spending seen in September will continue with virus infections rising, job growth stalling and government aid fading.

Enhanced unemployment benefits and direct cash payments distributed as part of the CARES Act made it possible for jobless Americans to boost spending and pad their savings. But much of those savings were spent in August after the supplement to unemployment benefits expired, according to a study released Friday by the JPMorgan Chase Institute.

The White House and Congress have yet to reach a deal on another package. Job growth is also slowing and the number of Americans filing new claims for jobless benefits reached a two-month high last week.

“The progress we’ve made, which has been better than expected, may be slowing,” said John Briggs, head of strategy for the Americas at NatWest Markets. “I don’t know how much it hurts Trump’s chances, but I don’t see how it can help him.”

(Reporting by Jonnelle Marte; Editing by Andrea Ricci)

Rare syndrome tied to COVID-19 kills three children in New York, Cuomo says

By Nathan Layne

(Reuters) – Three children in New York have died from a rare inflammatory syndrome believed to be linked to the novel coronavirus, Governor Andrew Cuomo said on Saturday, a development that may augur a pandemic risk for the very young.

Both Cuomo and his counterpart in the neighboring state of New Jersey also spoke on Saturday about the pandemic’s growing toll on mental health, another factor on the minds of governors as they weigh the impact of mounting job losses against health risks in moving to loosen restrictions on daily life.

Nearly all of the 50 U.S. states will have taken steps to relax lockdown measures by this weekend, including states like Arizona and Mississippi, which are reporting increasing infections of COVID-19, the disease caused by the virus, highlighting the risk of a new wave of outbreaks.

Cuomo told a daily briefing that he was increasingly worried about a syndrome that shares symptoms with toxic shock and Kawasaki disease, which he said included inflammation of the blood vessels and potentially fatal damage to the heart.

He said three children – including a five-year old disclosed on Friday – have died from such symptoms while also testing positive for COVID-19 or related antibodies, suggesting a link that was still not fully understood.

Cuomo, who has emerged as a leading national voice on states’ response to the coronavirus crisis, said state health officials were reviewing 73 similar cases, which have rattled a prior assumption that children were largely not susceptible to the novel coronavirus.

“We are not so sure that is the fact anymore. Toddler, elementary school children are presenting symptoms similar to Kawasaki disease or toxic shock-like syndrome,” Cuomo said. “It’s very possible that this has been going on for several weeks and it hasn’t been diagnosed as related to COVID.”

Cuomo said state health officials had partnered with the New York Genome Center and the Rockefeller University to look at whether there is a genetic basis for the syndrome and have been asked by the federal Centers for Disease Control and Prevention to develop national criteria for identifying and treating cases.

The syndrome shares symptoms with toxic shock and Kawasaki disease, which is associated with fever, skin rashes, swelling of the glands, and in severe cases, inflammation of arteries of the heart. Scientists are still trying to determine whether the syndrome is linked with the new coronavirus because not all children with it have tested positive for the virus.

At a separate briefing, New Jersey Governor Phil Murphy said the death of a four-year old disclosed on Friday was not related to the syndrome. “This is a very specific situation with this blessed little kid and we are going to leave it at that.”

‘TOXIC MIX’

New York and New Jersey are at the epicenter of the pandemic in the United States, accounting for nearly half of the 77,737 American deaths from COVID-19, according to a Reuters tally, and the two states have among the strictest lockdown rules still in place.

They are also at the center of a devastating economic toll underscored in government data released on Friday showing the U.S. unemployment rate rose to 14.7% last month, up from 3.5% in February and shattering the post-World War Two record of 10.8% set in November 1982.

Cuomo said his state has seen increasing reports of mental health issues, substance abuse and domestic violence, all tied to the economic stress and isolation of the lockdowns.

On Friday a study released by the Well Being Trust and the American Academy of Family Physicians estimated an additional 75,000 people could lose their lives to suicide, drugs and other contributors to “deaths of despair” stemming from the crisis.

Murphy echoed those concerns.

“The cure for the health crisis is keeping people isolated,” Murphy told his briefing. “You add to that job loss, small businesses that have been crushed. It’s a toxic mix.”

Cuomo said 226 New Yorkers died from COVID-19 on Friday, up from 216 a day earlier, but less than half the levels recorded two weeks ago. He said hospitalizations and intubations continued their downward trend, further evidence the state has gained a measure of control over the virus.

Murphy said an additional 166 residents of his state had died over the past 24 hours from COVID-19, bringing its total fatalities to 9,116, while total cases rose by 1,759 to 137,085.

On a positive note, Murphy said the number of people hospitalized for the disease continued to fall, with the 422 patients discharged over the past 24 hours outpacing the 364 newly admitted for treatment.

Yet Murphy warned against complacency and said his constituents should continue to practice social distancing.

“We are not out of the woods, folks. Let’s not forget that,” he said.

(Reporting by Nathan Layne in Wilton, Connecticut; Editing by Daniel Wallis and Dan Grebler)

Robots will be your colleagues not your replacement: Manpower

FILE PHOTO: A robotic bartender prepares drinks inside a space modul-like structure in Prague, Czech Republic, November 28, 2018. REUTERS/David W Cerny/File Photo

BERLIN (Reuters) – Fears that robots will eliminate your job are unfounded with a growing number of employers planning to increase or maintain headcount as a result of automation, staffing company ManpowerGroup said in a survey published on Friday.

The “Humans Wanted: Robots Need You” report surveyed 19,000 employers in 44 countries and found 69 percent of firms were planning to maintain the size of their workforce while 18 percent wanted to hire more people as a result of automation. That was the highest result in three years.

The report went on to say that 24 percent of the firms that will invest in automation and digital technologies over the next two years plan to add jobs compared to 18 percent of those who are not automating.

Just 9 percent of employers in the annual survey said automation would directly lead to job losses, while 4 percent did not know what the impact would be.

“More and more robots are being added to the workforce, but humans are too,” said Jonas Prising, Chairman & CEO of ManpowerGroup.

“Tech is here to stay and it’s our responsibility as leaders to become Chief Learning Officers and work out how we integrate humans with machines.”

More than 3 million industrial robots will be in use in factories around the world by 2020, according to the International Federation of Robotics.

The Manpower survey found that 84 percent of firms planned to help their workers learn new skills by 2020, compared to just 21 percent in 2011.

The global talent shortage is at a 12-year-high, with many companies struggling to fill jobs, according to Manpower.

In Germany, where unemployment is at a record low, a shortage of talent was the top concern of small-to-mid-sized companies heading into 2019, according to a survey by the BVMW Mittelstand association.

The Manpower survey found IT skills are particularly in demand with 16 percent of companies expecting to hire staff in IT.

In manufacturing and production, where industrial robots are increasingly doing routine tasks, firms expect to hire more people in customer-facing roles that require skills such as communication, leadership, negotiation and adaptability.

Employers in Singapore, Costa Rica, Guatemala and South Africa expected to add the most staff, while firms in Bulgaria, Hungary, Czech Republic, Norway, Slovakia and Romania predicted a decrease in headcount, the survey found.

(Writing by Caroline Copley; Editing by Elaine Hardcastle)

U.S households see spending up, job prospects improving: New York Fed survey

- A shopper walks down an aisle in a Walmart Neighborhood Market in Chicago

WASHINGTON (Reuters) – Consumers expect to boost spending in the months ahead and voiced confidence they are more likely to find a job and less likely to lose one in a strong labor market, the New York Federal Reserve reported Monday in its latest monthly survey of consumer expectations.

Nearly 35 percent of the 1,300 heads of household included in the June poll said they were better off economically than a year go, a record in the four years the survey has been conducted.

The results bolster the current Fed outlook of an economy that continues to generate jobs despite tepid overall growth and some concern about a recent dip in inflation, improving chances the central bank can follow through with plans for a further interest rate increase later this year.

Though household expectations of inflation for the year ahead did dip slightly from the May survey, to 2.5 percent from 2.6 percent, respondents expect strong price increases of 2.8 percent over the coming three years. That’s consistent with the Fed’s current outlook that the recent weakness in inflation will prove temporary.

The survey also bolstered the view of continued strong consumption growth. Half of those polled said they expected to spend at least 3.3 percent more in the coming year, compared to median expected spending growth of 2.6 percent in the May survey. One-year-ahead expected earnings growth increased to 2.5 percent in the June survey from 2.2 percent in May.

Respondents also showed broad faith in the strength of the labor market, with a slight dip to 13.5 percent from 13.6 percent in the perceived probability of losing a job in the next year, and a jump to 59.2 percent from 56.7 percent in the probability of finding employment.

More than a fifth of respondents said they might leave a job voluntarily in the next year, up from 19.4 percent in May. Voluntarily job exits are considered a sign of a strong labor market that offers employees choices.

The online poll is designed to be a representative sample of the U.S. population. The New York Fed did not provide the margin of error for the poll.

 

(Reporting by Howard Schneider; Editing by Andrea Ricci)

 

U.S. employment gains hit seven-month low, labor force shrinks

Hiring Our Heroes event

By Lucia Mutikani

WASHINGTON (Reuters) – The U.S. economy added the fewest number of jobs in seven months in April and Americans dropped out of the labor force in droves, signs of weakness that cast doubts on whether the Federal Reserve will raise interest rates before the end of the year.

Nonfarm payrolls increased by 160,000 jobs last month as construction employment barely rose and the retail sector shed jobs, the Labor Department said on Friday. That was the smallest gain since September and below the first-quarter average job growth of 200,000.

Adding to the report’s weak tone, employers added 19,000 fewer jobs in February and March than previously reported. While the unemployment rate held at 5.0 percent that was because people dropped out of the labor force.

“For those who had thought a June rate hike was in play, this was a nail in the coffin. This raises questions about a September rate hike. I would like to think the economy is in a better place at the end of the year,” said Phil Orlando, chief equity market strategist at Federated Investors in New York.

The stepdown in job gains could temper expectations of a strong rebound in economic activity in the second quarter after growth nearly stalled in the first three months of the year.

Economists polled by Reuters had forecast payrolls rising 202,000 last month and the jobless rate unchanged at 5 percent.

The dollar dropped to session lows against the euro and the yen after the report. Prices for U.S. government debt rose, while U.S. stock index futures fell marginally.

Average hourly earnings were the only bright spot in the employment report, rising eight cents or 0.3 percent last month.

That took the year-on-year increase to 2.5 percent from 2.3 percent in March, still below the 3.0 percent advance that economists say is needed for inflation to rise to the Fed’s 2.0 percent target.

RATE HIKE PROBABILITIES DIMINISHING

The U.S. central bank last month offered a fairly upbeat assessment of the labor market, saying that conditions had “improved further.” The Fed raised its benchmark overnight interest rate in December for the first time in nearly a decade. Fed officials have forecast two more rate hikes for this year.

Market-based measures of Fed policy expectations have virtually priced out an interest rate increase at the Fed’s June 14-15 meeting, according to CME Group’s FedWatch. They see a less than 40 percent probability of rate hikes in September and November, with a 48 percent chance at the December meeting.

The labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job, fell 0.2 percentage point to 62.8 percent. It had increased 0.6 percentage point since dipping to 62.4 percent in September.

The labor force fell by 362,000 as people dropped out in April. The employment-to-population ratio fell to 59.7 percent from a seven-year high of 59.9 percent.

A broad measure of unemployment that includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment slipped one-tenth of a percentage point to 9.7 percent last month. The vast private services sector dominated employment gains in April, adding 174,000 jobs. Retail payrolls fell 3,100 after hefty gains in the first quarter, despite sluggish sales.

While information employment was unchanged last month, a Labor Department official said there was no sign that a strike by about 40,000 Verizon workers had impacted the data.

Manufacturing added 4,000 jobs last month after shedding 29,000 in March, the biggest loss for the sector since December 2009.

There were further job losses in mining as the energy sector adjusts to weak profits from a recent prolonged plunge in oil prices. Mining payrolls fell 8,000 last month. Mining employment has decreased by 191,000 jobs since peaking in September 2014, with 75 percent of the losses in support activities.

Gains in construction employment slowed sharply, with the sector adding 1,000 jobs in April, after home building showed some signs of fatigue last month.

(Reporting by Lucia Mutikani; Additional reporting by Richard Leong in New York; Editing by Andrea Ricci)

Major Companies to Cut Significant Amount of Jobs

Major companies, mostly located in the United States, are expecting to cut thousands of jobs within the next few years. These companies include: Whole Foods, Caterpillar, Chesapeake Energy, Hewlett-Packard Co., and Toshiba, along with supermarket giant, Wal-Mart Stores.

Reasons for the cuts have been attributed to a variety of reasons. Whole Foods reported to USA Today that they would be cutting 1,500 jobs within the next two months in order to lower prices for customers. The organic grocery store also announced that they would be trying to find other jobs within the company for those who were laid off.

Caterpillar, the heavy equipment manufacturer, said they would be cutting 10,000 jobs within the next three years. The job cuts come from a lack of projects for the company due to weakness in the energy and mining businesses worldwide, which affects the company greatly because their equipment is usually used for resource extraction and construction.

Another company that has been affected by the energy industry is Chesapeake Energy. Due to the high prices of oil and natural gas, the energy company is having to cut 750 workers, which is 15% of its workforce. Most of the job cuts will be in Oklahoma City, OK, where the company is based.

The technology business has also been affected by the recent world markets. Hewlett-Packard Company (HP) announced earlier this month that they would be cutting 33,300 jobs over the next three years due to falling demand. Another tech giant, Toshiba, also announced today that they would be cutting jobs as well due to a recent account scandal within the company. So far, Toshiba has not announced how many jobs would be cut, but that there would be restructuring within their company.

Even one of the biggest companies in the United States announced today that they would be cutting jobs. Wal-Mart Stores told Reuters that hundreds of people would be laid off at their headquarters in Arkansas. They expect fewer than 500 employees to lose their jobs. The job cuts were announced while the company struggles to shore up its profit margins, which have been weighted down by a $1 billion investment earlier this year to increase the wages of employees. So far this year, the stock for the world’s biggest retailer is down 26%.

CNN Money reported that the U.S. has cut more than 86,000 jobs due to falling oil prices.