Tag Archives: working from home

Working from home may hurt women’s careers, says Bank of England’s Mann

By David Milliken

LONDON (Reuters) -Women who work mostly from home risk seeing their careers suffer now that significant numbers of workers are returning to the office after the COVID-19 pandemic, Bank of England policymaker Catherine Mann said on Thursday.

Mann, a member of the BoE’s Monetary Policy Committee, said online communication was unable to replicate the spontaneous office conversations which were important for recognition and advancement in many workplaces.

“Virtual platforms are way better than they than they were even five years ago. But the extemporaneous, spontaneity – those are hard to replicate in a virtual setting,” she told an event for women in finance hosted by the newspaper Financial News.

Difficulty accessing childcare and COVID-related disruption to schooling meant many women were continuing to work from home, while men returned to the office, Mann said.

“There is the potential for two tracks. There’s the people who are on the virtual track and people who are on a physical track. And I do worry that we will see those two tracks develop, and we will pretty much know who’s going to be on which track, unfortunately,” she said.

Mann was an economics professor and chief economist at Citi and the Organization for Economic Co-operation and Development (OECD), before joining the BoE in September.

British finance minister Rishi Sunak warned younger workers in August that they risked missing out on building skills and work relationships if they worked from home.

British businesses last month said 60% of their staff were fully back at their normal place of work, but proportions vary widely by sector. In professional services, 34% of staff are in the office, 24% are fully working from home, and 35% are doing a mix, according to the Office for National Statistics.

Separate ONS data shows a slightly higher percentage of male workers than females worked from home for at least some of the time in late October, although the gap was within the survey’s margin of error.

Previous ONS analysis showed women were more likely than men to say working from home allowed them more time to work, with fewer distractions. But men said working from home helped them come up with new ideas, while women found it a hindrance.

(Reporting by David Milliken; Editing by William Schomberg)

Pandemic’s labor reshuffle likely just starting for U.S. workers

By Howard Schneider

WASHINGTON (Reuters) – If the coronavirus pandemic produced its own brand of anxiety for American workers trying to stay healthy while balancing job and family demands, the coming return to “normal” will pose a new set of challenges.

Like whether to first try to claw back all the free hours of labor donated to companies during the crisis, or shift to a “future-proof” occupation to insure against the next one, or figure out how to compete with the robots being deployed more widely because of the pandemic.

The workforce fallout from the coronavirus outbreak, in other words, may have only just begun.

Some industries are recovering faster than others, with the worst-hit sectors continuing to lag. Even though U.S. gross domestic product is near its pre-pandemic peak, jobs are rebounding more slowly, suggesting a potentially prolonged period of adaptation ahead for both workers and companies.

Payroll processor ADP set a baseline of sorts in a recent survey of more than 32,000 workers globally that showed just how unsettled the landscape is as the pandemic, at least in the major developed economies, reaches its endgame.

Over the past year, for example, workers often said they benefited from the flexibility of working from home and wanted it to continue. Companies and their employees have both reported improved productivity.

But it turns out some of that “flexibility” was consumed by a substantial increase in unpaid overtime, according to the ADP survey, which was conducted last fall. That means the higher productivity may be something of a mirage, not the outcome of better work-life balance but value donated to firms by workers worried about staying employed. Workers globally reported unpaid hours rose about 25%, from 7.2 to 9.3 per week. In the United States, it more than doubled from 4.1 to 9.

SPREAD OF AUTOMATION

People, and women in particular, “may be returning to a corporate landscape that expects more hours worked with less compensation,” said Nela Richardson, ADP’s chief economist. “That’s a post-COVID burden,” which could potentially frustrate hopes to reemploy the roughly 2 million U.S. women still absent from the labor force compared with February 2020.

More than three-fourths of workers globally said job insecurity had prompted them to work more during the week or on their days off, and take on new tasks including ones they were not comfortable performing. Richardson said those results mean companies and their workers will need to find a new post-pandemic relationship. Many workers took on new duties, for example, but often without a raise or extra training, an outcome particularly true for women.

The ADP survey found 15% of respondents said they were planning to shift occupations altogether to something more “future-proof,” a finding with implications for how companies and workers match up if large shares of people in, say, the restaurant sector decide they want to do something else.

The U.S. labor market’s weak performance in April – it added only about a quarter of the jobs that had been expected by a Reuters poll of economists – may be related at least in part to people’s reluctance to return to jobs they no longer see as rewarding or worth the health risk.

Defining what future-proof means, however, is challenging as the pandemic shifts consumer behavior in potentially permanent ways – the rush to online shopping and a preference for buying goods or participating largely in “distanced” activities – and automation spreads deeper into the service sector.

The Association for Advancing Automation last week reported a nearly 20% increase in purchases of industrial robots in the first three months of 2021 versus 2020, and most went to companies outside the auto sector where they are already prevalent. Orders by consumer companies rose 32%.

The pandemic has motivated hotels, restaurants and other consumer-facing, “high-touch” companies to build social distancing into their business models, possibly resulting in fewer employees than before.

In an analysis last week, Bank of America’s Ethan Harris and Jeseo Park argued that over time people will find jobs nevertheless, just as they have during past technological upheavals.

“While the COVID crisis has likely sped up structural changes in the labor market, these multi-decade changes are much slower than the dynamics of the business cycle,” wrote Harris, the bank’s head of global economics, and Park, a global and U.S. economist. “Over time the labor market will re-invent itself as it has done repeatedly across history.”

The interim can still be tough, and a slow adjustment may mean higher-than-expected unemployment while it plays out.

A recent U.S. Bureau of Labor Statistics study indicated the burden may fall hardest on the same workers most affected by the pandemic recession. If the dislocation is deep, the U.S. economy may have 3 million jobs fewer than it would otherwise by 2029, with many of the losses among waiters, retail clerks and other front-line service occupations.

(Reporting by Howard Schneider; Editing by Dan Burns and Paul Simao)

Pandemic takes center stage in holiday shopping ad campaigns

By Sheila Dang

(Reuters) – After spending the summer convincing consumers to take socially distanced breaks from grim reality, advertisers are now returning to the pandemic as the central focus in holiday shopping campaigns launching this month.

U.S. companies from carmakers to retailers are under pressure to make the shopping season a success after retail sales crashed 21% earlier this year as millions of Americans lost jobs and cut their budgets. They face the challenge of convincing consumers to open their wallets for the holidays even as the coronavirus pandemic rages anew across the United States and Europe.

As new campaigns roll out, brands feel it is their responsibility to inspire optimism for the coming year, but also empathize with “the hurt that people have,” said Jason Schragger, chief creative officer at ad agency Saatchi & Saatchi.

Carmaker Lexus’ iconic “December to Remember” campaign, which features cars wrapped in giant red bows on picturesque snowy driveways, will focus on the different role that driveways have played this year, as people sought ways to celebrate birthdays, anniversaries and other milestones despite stay-at-home orders.

New TV commercials launching on Monday feature family and friends doing a drive-by graduation party in their Lexus vehicles as a student in a cap and gown waves from her driveway. In another, a man greets his children and grandkids from a distance as they drive by, waving a homemade “Happy Birthday, Grandpa” sign.

“We wanted to make sure we weren’t showing large gatherings of people,” said Lisa Materazzo, vice president of marketing at Lexus, owned by Toyota Motor Corp. “But it’s nice to have a live interaction, and that can happen when you’re safe in the car and waving from the driveway.”

Staying connected during the pandemic is the message behind ads for the department store Macy’s, whose window displays and Santa land attraction have been hallmarks of the holidays since the late 19th century.

At a time when flying home or hosting big family gatherings can be dangerous, Macy’s Inc is focusing on how finding and giving the perfect gift plays an even bigger role in connecting with people you can not see in person this year, according to Macy’s chief customer officer Rich Lennox.

A similar theme underpins Etsy’s commercial, in which a woman who longs to see her grandson opens a gift of a handmade doll that matches a picture he had drawn.

“You’re supposed to hug it when you can’t see us,” her grandson said over a video call while holding up the drawing.

PANDEMIC ADJUSTMENTS

Apparel retailer H&M has taken the pandemic-themed ad campaign a step further by changing how commercials are produced in keeping with the times.

The company will lean on influencers working from home to create content, and plans to provide them with outfits and holiday prop kits so they can take festive photos on their own, said Mario Moreno, H&M USA’s head of marketing.

Toy maker Mattel, which has targeted young fans directly on kids’ TV shows, is directing some marketing messages to parents this season.

The owner of the Barbie and Fisher-Price brands will craft digital and social media ads that address the struggle parents have with keeping their kids entertained and engaged after months of schooling from home, said Jason Horowitz, senior vice president of U.S. marketing at Mattel.

The ads will focus on gifts that can offer hours of playtime and mental stimulation while cooped up inside, such as a Thomas & Friends toy that lets kids make-believe that they are taking a trip from their living room, he said.

Expect optimism with a dose of reality at this dark time, ad executives said.

“There’s a lot of 2020 we want to leave behind,” Materazzo said. “But there are nuggets worth celebrating.”

(Reporting by Sheila Dang; Editing by Kenneth Li and Daniel Wallis)

Coffee, ketchup and Nike Air Max: it’s the COVID consumer economy

By Nick Carey, Richa Naidu and Siddharth Cavale

(Reuters) – Instant coffee, ketchup, Lululemon yoga pants and Nike Air Max sneakers are all in. Bottled water, pricey diapers and Burberry luxury trench coats are out.

Welcome to America’s pandemic consumer economy. And it’s like nothing we’ve seen before.

“Everything we knew about supply and demand, we can essentially throw out the window because consumer behavior has changed completely,” said Piotr Dworczak, assistant professor of economics at Northwestern University.

A Reuters analysis of a varied basket of goods shows how the COVID-19 crisis has upturned a decades-old consumer model for everything from clothing to food. This has given some companies surprising power to raise prices or withdraw discounts.

Many of the new trends can be attributed to one factor, according to retail specialists: working from home.

Almost overnight, a consumer-driven economy with clearly delineated work and home spending, changed profoundly. Rising demand for certain items, as well as global supply-chain disruptions, has driven up prices.

Americans are now shelling out significantly more than a year before for coffee, eggs, sliced ham, ketchup and cheese, for example, according to the Reuters analysis of the latest pricing data from Nielsen Co, the Brewers Association and StyleSage Co.

Yet it’s a complex picture, and some of the changes in behavior seem counter-intuitive during a time of deep economic uncertainty.

Demand and prices have also increased for more expensive, or “splurge”, items like $106 men’s Nike Air Max sneakers, $105 Lululemon yoga pants and even a $1,500 Louis Vuitton handbag.

Economists put this apparent discrepancy in behavior down to the fact that many people, unable to spend outside, have more cash in hand. Even many workers on furlough are receiving jobless benefits that match their wages under a federal stimulus plan.

“If I were to consider the consumer situation right now, in a strange way, they may have more disposable income, if they kept their job,” said Nirupama Rao, an assistant professor of business economics and public policy at the University of Michigan. “Of course we’re facing mass layoffs, but the bulk of people have maintained their wages and earnings.”

‘UNPRECEDENTED PRESSURE’

Shoppers paid roughly 8% more on average for JM Smucker’s instant coffees, including Folger’s and Dunkin’, at bricks-and-mortar stores in the four weeks to Aug. 8 versus a year before, according to Nielsen data analyzed by Bernstein.

They shelled out nearly 10% more for Kraft Heinz sauces and about 5% extra for Tyson Foods’ sliced hams.

Such inflation might make commercial sense, given the bump in demand for home staples. But some consumer experts complain retailers and big brands are cutting back on promotions and using their power to shore up profits during a health crisis that has led to millions losing their livelihoods.

“Brand manufacturers have been fattening their pockets with profits while putting unprecedented pressure on the consumer who has to pay those higher prices,” said Burt Flickinger, retail consultant at Strategic Resource Group.

JM Smucker said it did not raise prices of its instant coffees in the four weeks to Aug. 8, but did cut back on some promotions for in-demand products. Kraft Heinz declined to comment, but said during earnings in July that second-quarter prices went up as it pulled some offers and discounts for scarce products. Tyson did not respond to a request for comment.

Other industry experts point out that companies have had to grapple with costly production shifts to adapt to the new landscape. They note that before the pandemic, when costs were lower and there were more promotions and discounts, prices of Heinz sauces were declining.

Pre-COVID-19, tens of millions of commuters grabbed a coffee to-go en route to work. Suddenly, instead of 20-pound (9.1 kg) bags of coffee for restaurants, or large containers of ketchup, producers have had to switch to smaller, home-use packaging.

As ketchup, mayonnaise and vinegar sales surged, Kraft Heinz diverted resources to running these production lines around the clock, while suspending others. It added extra shifts for factory workers to make grocery-sized bottles.

Egg suppliers, like market leader Cal-Maine Foods Inc., have had to overcome a shortage of cartons.

“If you look at eggs, before they’d be powdered to send to restaurants and now they have to be put in cardboard containers to go to supermarkets,” said Daniel Bachman, senior U.S. economist at Deloitte. “It took a high price to induce the change.”

Yet consumer companies cannot take demand for granted and can be burnt by raising prices.

Prices for bottled water and disposable diapers have gone up, while demand has fallen for most of the pandemic. People are unwilling to pay out extra when they can drink their own water at home, and can opt for reusable or cheaper generic diapers at a time when there’s a lack of child daycare, some economists say.

“You’re at home anyway so you’re not sending your child off somewhere in a diaper that fails,” said Rao.

A $2,245 COAT, ANYONE?

Lockdowns have meant many Americans do not travel, eat out, or go to movie theaters. As they have not been commuting or taking kids to school, many are using less gas in their cars.

So they can now splash out on other things, perhaps.

Michael Collins, a professor at the University of Wisconsin’s consumer science department, calls this a “substitution effect.”

“It’s pretty clear people behave as if they have different pots of money,” he said. “Now I don’t eat out at all, so I have a couple of hundred dollars of new income not allocated to anything. I can substitute that money away from eating out and treat myself to other things.”

This effect could help explain the rise in demand and prices for the Air Max. Nike sold about 63% of their online stocks of the shoes in July, compared with only 10% a year earlier, according to apparel data company StyleSage which collects sales information from brand websites.

Air Max prices surged 10.5% on average versus a year before.

Prices for Lululemon’s yoga pants rose 7.2%, and about 45% of stocks were sold in July versus 15% the year before.

Meanwhile, the price of Louis Vuitton’s Neverfull MM Monogram handbag has risen 5% on its website since the start of May. In July, Louis Vuitton owner LVMH said sales momentum had picked up since June, even as its star label raised prices for a third time during the pandemic.

There are some limits, though.

Demand for a Burberry woman’s trench coat has declined, with only 3% of online stocks sold in July versus 14% a year earlier.

It’s a snip at $2,245, down 3.5%.

Nike and Burberry did not respond to requests for comment, while LVMH declined to comment beyond its July remarks. Lululemon said it hadn’t raised prices on some of its core yoga pant styles, including Align and Wunder Under, but had seen a significant rise in demand for yoga products since April. The strong July sales reflected its “Warehouse Sale” offer that month, it added.

HOW LONG WILL IT LAST?

Much remains uncertain.

The U.S. epidemic and its economic consequences are moving targets, and it is unclear when – or even if – American life and consumer behavior will revert to “normal”.

The University of Michigan’s Rao said food producers had been reluctant to invest in permanent changes to retool factories. “They’re hindered by the fact there’s so much uncertainty as to how long this will last.”

Indeed, consumer demand, as well as brands’ pricing power, could change in the coming weeks and months as many Americans feel more financial pain.

The government’s first round of COVID-19-related benefits expired on July 31, leaving about 30 million unemployed Americans without the $600 weekly boost that sustained their households and promoted some discretionary spending.

With the money spigot turned off, analysts say recessionary spending behavior should take hold, with consumers cutting back.

The University of Wisconsin’s Collins said loan forbearance on mortgages, credit cards and student loans since the spring had also helped consumers.

“Eventually that will all end, and people could start to tighten up again.”

(Reporting By Nick Carey, Richa Naidu and Siddharth Cavale; Additional reporting by Silvia Aloisi; Editing by Vanessa O’Connell and Pravin Char)

Pandemic teleworking is straining families: EU study

BRUSSELS (Reuters) – The COVID-19 pandemic is placing unprecedented strain on families and working life, an EU study showed on Friday, with more than a fifth of people who now work at home in households with younger children struggling to concentrate on their jobs.

The study by EU agency Eurofound, which seeks to improve living and working conditions, found that over a third of people working in the 27-nation European Union had started teleworking as a result of the pandemic.

Of those, 26% live in households with children under 12 and a further 10% with children aged from 12 to 17. Of those living with younger children, 22% reported difficulties in concentrating on their jobs all or most of the time.

That compared with 5% of households with no children and 7% with older children.

Mary McCaughey, Eurofound head of unit for information and communication, said the health and economic implication of the pandemic were understandably dominating the thoughts of the public and policymakers.

“However, the toll this pandemic has taken on family life cannot be ignored. Parents are facing unprecedented challenges, particularly now that most cannot avail of childcare services, and many are required to supervise schooling at home,” she said.

(Reporting by Philip Blenkinsop; Editing by Mark Potter)