WASHINGTON — The final jobs report before Election Day a month from now showed hiring slowed in September even as the U.S. unemployment rate fell to 7.9% — a mixed result for President Donald Trump, who has staked his reelection in part on the economy.
The Labor Department said Friday that employers added just 661,000 jobs last month amid the coronavirus outbreak, down from 1.5 million in August and 1.8 million in July.
Unemployment fell from 8.4% in August, but that mainly reflected a decline in the number of people seeking work, rather than a surge in hiring. The government doesn’t count people as unemployed if they aren’t actively looking for a job.
“There seems to be a worrisome loss of momentum,” said Drew Matus, an economist at MetLife Investment Management. “There’s a lot of caution on the part of employers.”
With September’s hiring gain, the economy has now recovered slightly more than half the 22 million jobs wiped out by the coronavirus, which has killed over 200,000 Americans and infected more than 7 million. With many businesses and customers plagued by fear and uncertainty, some economists say it could take as long as late 2023 for the job market to fully recover.
This week, moreover, brought a new wave of layoff announcements reflecting the continuing slump in travel and tourism: Disney is cutting 28,000 jobs, Allstate will shed 3,800, and U.S. airlines said as many as 40,000 employees are losing their jobs this month as federal aid to the industry expires.
In another problematic sign in Friday’s report, the number of laid-off workers who say their jobs are gone for good rose from 3.4 million to 3.8 million.
While unemployment has tumbled from April, when it topped out at 14.7%, it is still high by historical standards. For the Trump administration, the pandemic recession has been a whiplash, with unemployment soaring from a half-century low in February of 3.5% to a 90-year peak in April of 14.7%.
The U.S. gained nearly 7 million jobs from Trump’s 2017 inauguration until the pandemic struck. Now it has 3.9 million fewer than when he took office.
Friday’s numbers offered voters a final look at the most important barometer of the economy before the Nov. 3 presidential election — an election whose outcome was thrown into deeper uncertainty by the announcement Friday that Trump has tested positive for the coronavirus.
Still-high unemployment is a potential political liability for Trump. Yet President Barack Obama was re-elected in 2012 even with unemployment at 7.8% on the eve of the election.
And even as the economy has struggled to sustain a recovery, it has remained one of the few bright spots in Trump’s otherwise weak political standing. Roughly half of voters approve of his performance on the economy.
Voters in some battleground states may feel differently. In August, the latest data available, unemployment was 10.3% in Pennsylvania and 8.7% in Michigan, both above the national rate that month. Florida was at 7.4% and Wisconsin at 6.2%, with both states below the national average.
The economy is under pressure on a number of fronts, including the expiration of federal aid programs that had fueled rehiring and sustained the economy — from a $600-a-week benefit for the unemployed to $500 billion in forgivable short-term loans to small businesses.
The September jobs report showed that women in their prime working years are quitting their jobs and leaving the workforce at much higher rates than men, a sign that many women are staying home to help their children with remote schooling.
“Women continue to bear the brunt of this recession,” said Julia Pollak, a labour economist at ZipRecruiter. “They are supervising at-home schooling.”
This is the first U.S. recession in which service-sector jobs have been hardest hit, instead of goods-producing industries like manufacturing, and women make up a greater share of the workforce in service industries like retail and health.
Many in-person service providers, such as gyms, movie theatres, and restaurants are still employing far fewer people than before the outbreak.
Charlie Cassara, who owns two gyms on New York’s Long Island, said he has brought back only one of his 20 employees since gyms were allowed to reopen at 33% capacity in late August. He said many of his clients have stayed away out of fear of the virus.
He has been unable to pay full rent and expects he will have to close one gym by the end of the year unless things change.
“Everybody is pretty much hanging on now with the hope that maybe they are going to have a chance if they can survive the winter, but the outlook is not good,” said Cassara, president of the New York Fitness Coalition, which has sued New York City to allow indoor fitness group classes.
The unemployment rate for Black workers fell sharply last month but is still much higher than it is for whites. The African-American rate dropped to 12.1% from 13% in August. For whites, unemployment declined from 7.3% to 7%. For Hispanics, the rate fell from 10.5% to 10.3%.
Overseas, unemployment rose for a fifth straight month in Europe in August and is expected to climb further amid concern that government support programs won’t be able keep many businesses hit by coronavirus restrictions afloat indefinitely.
Associated Press writers Steve Peoples and Alexandra Olson in New York contributed to this report.
Christopher Rugaber, The Associated Press
Victorious BC NDP faces uncertain political, economic landscape over next four years – Business in Vancouver
Thanks to those mailed-in ballots, we will know who are the members of the next U.S. Congress before we know who are the members of the next B.C. Legislative Assembly.
But at least we know who is the premier within our borders before we know who will be the president below the border.
Dr. Bonnie Henry led the province to flatten the pandemic’s curve, which created a nice poll trajectory for John Horgan. He made no other case for this election but his reelection, but there is good reason why the word “opportunist” often comes to mind when describing a politician.
Horgan knew the economy might be way worse this time next year, when his minority governing covenant with the Greens expires. Today’s tendency to blame troubles on the pandemic might next year be a tendency to blame troubles on the government, so he chose to break the pact and launch his latest public offering when the market appeared most willing to pay for it.
The bet was publicly derided but privately admired for its political savvy. It proved safe. The NDP will have more seats than ever in the 87-seat legislature.
Horgan would keep a straight face when he said the province needed political stability, even if there were no signs of unsettledness in the cross-party cooperation in COVID-19. For his poker face, though, he gets dealt a very uncertain hand in the next four years.
The NDP has in recent months figured out how to spend and salve some wounds in the pandemic. Soon it will need to determine how to pay – or how we will. Some of its most ambitious ideas – for child care, for social and below-market housing, for climate change, for transit – have their largest commitments due in the next term. Sooner or later, too, the cryptic financial strait of the Site C hydroelectric project will be clarified.
And, of course, there is the cost of the pandemic on livelihoods and on businesses, along with the challenge of how to reignite what was the country’s leading economy – unchartered territory for the NDP. The campaign gave us no clues on how Horgan will approach the larger questions. He has some figuring to do.
There is no doubt all of this will reach deeper into our pockets. None. It’s only a question of whose, how soon, how often, and how deeply.
We can conveniently forget that the 2017 election was actually won by the BC Liberals. The mailed-in ballot counts in one riding kept them from a majority and set into motion the negotiation that cemented – or Scotch-taped, anyway – the BC-Green deal.
So if the 1a) story Saturday was the rise of the NDP, 1b) was the collapse of the Liberals, their worst showing since they were coalesced by Gordon Campbell two decades ago. Andrew Wilkinson delivered a muted, barely audible speech late Saturday that conceded an NDP government but little else. He encouraged British Columbians to respect all voters and await the final results some two-plus weeks away, once the half-million mailed-in ballots are tallied.
But it is unlikely Wilkinson will have long to address his own political future. Already there are campaigns under way to succeed him, although one possible successor, Jas Johal, appears by the preliminary count to have lost his seat in Richmond-Queensborough. If Wilkinson chooses to stay, he will first have to persuade his party, and that is not a camp in a good mood.
The nightmare scenario for the Liberals was a much smaller caucus tilted heavily into the conservative camp, a result that might have shattered the coalition of centrist and right-of-centre cohorts. Now it will survive to fight another day, as mainly a rural party. But it’s hard to fathom it will fight under the same leader.
Well down from the 1a) and 1b) stories was the sleeper story Saturday of the Green Party. With Andrew Weaver’s departure as leader, but his endorsement of Horgan, there was every possibility the party would recede. But the Greens traded Weaver’s lost seat in Oak Bay for one in West Vancouver to keep three. Few saw that coming months ago.
New leader Sonia Furstenau made nothing but positive campaign impressions – the election timing was miserable for the Greens, just weeks after her ascension – and her opportunity in these next years is to further define the economic vision for the Greens. She backed Horgan down in a campaign he wanted to use to vaporize the Greens, and she has the chance to make him miserable for four years. For the time being, until the Liberals regroup, she is the de facto opposition leader.
Horgan got the benefit of a crisis in reelection. His challenge now is not to create one.
Kirk LaPointe is publisher and editor-in-chief of Business in Vancouver and vice-president, editorial, of Glacier Media.
Time to Reset Expectations for World Economy With Virus Untamed
Investors banking on a coronavirus vaccine to save the world economy in 2021 need to temper their ambitions as scientists increasingly warn of a long and difficult road ahead.
While drug companies are making progress in the quest to find a cure for a disease that triggered the worst recession since the Great Depression, questions remain about how effective the first wave of vaccines would be, how easy they will be to distribute to more than 7 billion people and then how many will agree to take them.
The future for global growth relies on the answers to those questions as a new wave of the pandemic means health fears and government restrictions continue to inhibit daily life and commerce. Even when a successful immunization system does come along, it won’t be an instant economic panacea, says Chris Chapman, a portfolio manager at Manulife Investment, which manages more than $660 billion.
“In terms of actually getting back to pre-Covid or trend growth, it could take more than a year,” said Chapman. “The timing of the recovery will be delayed, but there is still expectation of a vaccine at some point next year.”
For decades, the world economy relied on central bankers and finance ministers to pull it out of crisis, on the basis that if you pump the right amount of money into an economy, a recovery will eventually follow.
This time is different, as investors look to scientists and data from vaccine and treatment trials for signs of hope just as much as they pore over stimulus plans coming out of Washington, Beijing or European capitals. The longer the hunt for an effective vaccine lasts, the weaker economic expansions will be.
To be sure, science could yet make major breakthroughs in the near term. If even only a small proportion of the population such as healthcare workers and the most vulnerable are immunized, that could make a big difference to the resumption of everyday life. Savings built up by households and businesses in 2020 could be unleashed in 2021.
Pfizer Inc. said this month it could seek emergency-use authorization in the U.S. by late November for its vaccine with German partner BioNTech SE. Moderna, another frontrunner in the race, is also looking at the possibility of an emergency approval this year if it has positive interim results next month.
“There is a fair prospect that by the late spring, vaccines will be available in quantities sufficient to protect the most vulnerable groups,” said Neil Ferguson, an epidemiologist at Imperial College London, and former Covid-19 adviser to the U.K. government. “But at least until then, life will unfortunately remain a balancing act between reopening society and keeping the virus in check.”
Scientific hiccups may slow things down too. Johnson & Johnson paused clinical trials of its Covid-19 shot this month after a participant fell ill, weeks after AstraZeneca Plc and the University of Oxford stopped studies for the same reason. On Friday, both companies announced plans to resume their U.S. trials.
Effective treatments that would also help the economic recovery are also a mixed picture. Disappointing trial results this month for the much-hailed drug remdesivir from Gilead Sciences Inc. showed the antiviral treatment doesn’t save the lives of Covid-19 patients, despite U.S. President Donald Trump extolling its benefits. Still, U.S. regulators cleared the drug for use this week and Gilead has challenged the recent findings citing other positive results.
While there are hopeful signs from some antibody treatments being tested, the steroid dexamethasone is one of the only other therapeutics showing a meaningful benefit, and is aimed at people with very severe symptoms.
Even if an effective vaccine is discovered, the logistics of distribution will still mean disruption to work, travel and leisure will remain, with only a small subset of the population expected to receive a shot in the first instance anyway.
That all spells trouble for global growth, even as data in the U.S. and euro-area are likely to show this week that it rebounded smartly in the third quarter and didn’t collapse as much as once feared.
Long gone though is talk of a V-shaped recovery, as winter nears in the northern hemisphere — and with it the risk the virus spreads more easily. Bloomberg Economics’s gauges of high-frequency data already point to a weakening of activity in many industrial nations in October, particularly those in Europe.
“The virus is creating a major element of uncertainty,” former Federal Reserve Chairman Alan Greenspan told Bloomberg Television last week. “Forecasting it is very precarious.”
Underscoring the pressure for an end to the pandemic is the knowledge economic scars are already forming. Among them: lost jobs, record debts, corporate bankruptcies, atrophying skills, missed investment, deglobalization, frayed mental health and rising inequality.
A recent study declared the U.S. economy alone will witness “large, persistent adverse effects” in the long term that outweigh the short-term hit in part because the virus means greater unease among the public.
“This did not start as a financial crisis but it is morphing into a major economic crisis, with very serious financial consequences,” World Bank Chief Economist Carmen Reinhart told Bloomberg Television. “There’s a long road ahead.”
Even in those parts of the world where the virus has been largely contained, consumers remain cautious. Chinese retail sales have only just begun to accelerate even though the most severe limits on movement were lifted months ago.
There is also the question of re-infection. Scientists have found it’s possible to get Covid-19 more than once, with a handful of confirmed cases globally. That presents another obstacle, which a vaccine may only partially solve.
There’s a high chance the coronavirus, like flu, could require regular shots to keep it at bay, meaning the virus could cast an even longer arc than already expected, cautioned Graham Medley, a professor of infectious disease modeling at the London School of Hygiene & Tropical Medicine, and member of the U.K. government’s Covid-19 advisory panel.
“If second and third infections are as infectious as the first infection, and the first generation of vaccines is not very efficacious, then it’s possible that Covid-19 will continue to be a major aspect of life into 2022,” he said.
World Economy Gets Temperature Check Before U.S. Vote: Eco Week
The Canadian Press
NEW DELHI — India’s daily coronavirus cases have dropped to nearly 50,000, maintaining a downturn over the last few weeks.The Health Ministry says 50,129 new cases have taken the overall tally to nearly 7.9 million on Sunday. It also reported 578 deaths in the past 24 hours, raising total fatalities to 118,534.The ministry also said India’s active coronavirus cases were below 700,000 across the country and almost 7.1 million people had recovered from COVID-19.India is second to the United States with the largest outbreak of the coronavirus. Last month, India hit a peak of nearly 100,000 cases in a single day, but since then daily cases have fallen by about half and deaths by about a third.Some experts say the decline in cases suggests that the virus may have finally reached a plateau but others question the testing methods. India is relying heavily on antigen tests, which are faster but less accurate than traditional RT-PCR tests.___HERE’S WHAT YOU NEED TO KNOW ABOUT THE VIRUS OUTBREAK:— Surging coronavirus colours White House race in closing days— Europe, US watch case totals grow, debate new restrictions— Colombia reaches 1 million confirmed coronavirus cases— Iran’s supreme leader has urged authorities to prioritize public health above any economic or security concerns, amid the Mideast’s worst outbreak of the coronavirus. Iran’s death toll from the global pandemic topped 32,000 this week.— Pope Francis met with the Spanish prime minister Saturday at the Vatican, which has had a rash of COVID-19 infections confirmed in recent days, but neither man used a face a mask during the public part of their meeting.— Poland’s President Andrzej Duda has tested positive for the coronavirus; apologizes to those in quarantine because of contact, including Poland’s recent French Open winner.— Police force in England says it will try to stop people from leaving Wales, which has started a 17-day lockdown to slow a surging rate of coronavirus infections.___Follow all of AP’s coronavirus pandemic coverage at http://apnews.com/VirusOutbreak and https://apnews.com/UnderstandingtheOutbreak___HERE’S WHAT ELSE IS HAPPENING:MELBOURNE, Australia — A COVID-19 outbreak in the north of Melbourne has led health authorities in Australia’s Victoria state to hold off on any further easing of restrictions in the beleaguered city.Victoria Premier Daniel Andrews withheld any announcement on an easing on Sunday as the state awaits results on 3,000 people who were tested in the city’s north in the past 24 hours.He described it as a “cautious pause” – not a setback – to rule out there wasn’t widespread community transmission linked to the cluster.Among the current restrictions are mandatory wearing of masks and no travelling beyond 25 kilometres (15 miles) from home. At the start of the second wave of cases two months ago, Andrews instituted an overnight curfew and shut down most businesses.“I know it is frustrating,” Andrews said. “I know people are keen to have a long and detailed list of changes to the rules. It is not appropriate for us to do that now.”?Victoria reported seven new coronavirus cases on Sunday, with six linked to the latest outbreak, which involves 39 people across 11 households.No additional deaths kept the state toll at 817 and the national toll at 905.___COLOMBO, Sri Lanka — Sri Lankan authorities have terminated a number of passenger trains and widened the curfew as COVID-19 cases related to a new cluster at a garment factory continue to surge.The Railway Department cancelled at least 16 trains — mostly ran through busy office hours — after the number of commuters declined due to the curfew imposed in many parts of the country.More than a dozen villages are isolated in densely populated Western province, which includes capital Colombo.Authorities last week closed the island’s main fish market on Colombo’s outskirts after 49 traders tested positive for the coronavirus. By Sunday, the number of cases from the fish market went up to nearly 900.Authorities say the outbreak is linked to a cluster in a garment factory early this month, which has grown to 4,052 cases, more than half the country’s total of 7,521. During the last 24 hours, 368 new cases have been detected.In a bid to contain the spread, health authorities also closed three fishery harbours and many fish stalls around the country.Several thousand people have been asked to quarantine at home. Schools and key public offices are closed and gatherings banned. The death toll rose to 15 on Saturday.___BOGOTA, Colombia — Colombia reached 1 million confirmed coronavirus cases on Saturday, its health ministry says, becoming the second country in Latin America to report that number in less than a week.The nation of 50 million saw cases peak in August and has seen a decline since but still continues to register around 8,000 new infections a day.Eight countries now have more than 1 million confirmed cases, and three are in Latin America. Argentina hit 1 million confirmed cases on Monday. Brazil ranks third worldwide in the number of virus cases, with more than 5 million, and passed 1 million infections back in June. Peru and Mexico are expected to reach 1 million cases each in the coming weeks.Overall, Latin America continues to register some of the highest caseloads, diagnosing more than 100,000 confirmed infections each day, though the World Health Organization reports that Europe is now seeing even larger numbers as a second virus wave strikes.___LANSING, Mich. — Michigan has reported more than 3,000 new confirmed cases of the coronavirus — the highest daily count yet during the pandemic.The 3,338 new COVID-19 cases reported Saturday by the Michigan Department of Health and Human Services surpassed the state’s previous single-day record of 2,030 new cases set on Oct. 15. That earlier record had topped the previous record of 1,953 from early April.The state agency also reported Saturday 35 more deaths from COVID-19, raising Michigan’s pandemic toll to 7,182 deaths.Dr. Joneigh Khaldun, Michigan’s chief medical executive, said in a statement that it’s “now more important than ever that people take this seriously.” She urged Michigan residents to wear a face mask every time they are around someone outside of their own household, to practice social distancing and avoid large gatherings.___EL PASO, Texas — The surge in coronavirus in the Texas border city of El Paso continued Saturday with a record 1,216 new cases, nearly 20% of the state’s 6,125 new cases, according to city-county health officials.There have been 3,346 cases in the city during the past three days, according to city-county health reports. El Paso has reported 38,554 total cases since the pandemic began in March.“Today’s spike is part of an unfortunate national surge that we have been planning and preparing for,” public health director Angela Mora said in a statement. “Now, we need our community to help us by doing their part and staying home, if and when possible, for the next two weeks in order to stop the rapid the spread of the virus.”Gov. Greg Abbott has sent medical equipment and about 500 medical personnel to the region to help fight the virus. There have been more than 858,000 reported cases in Texas and nearly 17,500 deaths, 81 reported Saturday, since the pandemic’s start.___COLUMBIA, Tenn. — A Tennessee hospital is suspending all elective procedures requiring an overnight stay due to a surge in patients hospitalized with COVID-19, The Daily Herald of Columbia, Tennessee, reported.As of Friday evening, Columbia’s Maury Regional Medical Center was treating 50 COVID-19 inpatients, 20 of whom were in the medical centre’s 26-bed intensive care unit. In response, the hospital said Friday it is suspending elective surgical procedures that require an overnight stay for two weeks, beginning on Monday.“The time has long passed for our community to take this virus seriously,” Alan Watson, CEO of Maury Regional Health, said in a Friday statement. “We are seeing the impact of our community letting down their guard, and we must make every effort to mitigate the spread of this virus.”On Thursday, the Tennessee Department of Health reported that statewide hospitalizations had reached a new record of 1,300 patients with COVID-19 and had an ICU bed availability of just 11%.Martin Chaney, Maury Regional’s chief medical officer, said small home gatherings have become the emerging threat through which the disease is being spread in the six-county region the medical centre covers.“In our homes, we all let our guard down,” Chaney said. “You think it is safe to not socially distance, and you take your masks off. That is spreading the disease very rapidly.”He said Maury Regional has consistently seen a surge in cases about two weeks after each major holiday.“It is so predictable now,” Chaney said. “When families travel and get together for holidays, it is a high-risk time for spreading the virus.”Tennessee recorded 2,574 new cases of the coronavirus on Saturday and 24 new deaths, bringing the total number of deaths in the state to 3,100.___VATICAN CITY — Pope Francis met with the Spanish prime minister at the Vatican, but neither man wore a mask during the public part of their meeting.That’s despite 13 Swiss Guards and someone staying at the same Vatican City guest house where Francis lives recently testing positive for the coronavirus.Prime Minister Pedro Sanchez wore a mask when he arrived in a Vatican courtyard, but everyone sat unmasked immediately before and after his closed-door talks with Francis.Spain this week became the first country in Western Europe with more than 1 million confirmed virus cases.The Vatican says Sanchez also spoke with the Holy See’s foreign minister, discussing matters including “the current health emergency, the process of European integration and migration.”In his speech, Francis called politics “an act of charity, nobility” and the mission of a politician is to help a nation to progress. The pontiff also says its “very sad” when ideologies drive the destiny of a nation.___PHOENIX — Arizona is experiencing increases in coronavirus cases and the rate of positive test results.The 14-day rolling average of daily confirmed infections rose from 617 on Oct. 9 to 914 on Friday. Meanwhile, the average daily deaths increased from 7.6 to 8.4 and the positive test average went from 6.5% to 8.9%.Rolling averages even out daily spikes and drops.The state Department of Health Services on Saturday reported 890 cases and four additional deaths, increasing the Arizona totals to 236,772 confirmed infections and 5,869 deaths.___OKLAHOMA CITY — Oklahoma has registered more than 1,800 newly confirmed coronavirus cases.The Oklahoma State Department of Health report on Saturday comes one day after Gov. Kevin Stitt extended a state of emergency another 30 days. The health department reported 1,829 new cases for a total of 115,685.There have been 11 more deaths, bringing the death toll to 1,245.The Associated Press
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