A sign in the window of a FedEx office reads, "Now Hiring," Monday, Oct. 26, 2020 in New York. (AP Photo/Mark Lennihan)
By Christopher Rugaber
U.S. employers added 638,000 jobs in October, a solid pace though far fewer than needed to regain most of the jobs lost to the pandemic recession just as new viral cases are setting record highs.
The gain suggested that a tentative economic recovery may remain intact even in the face of a surging viral outbreak.
The report Friday from the Labor Department said the unemployment rate fell to 6.9% from 7.9% in September. But eight months after the virus struck the United States, the economy still has recovered barely half the 22 million jobs that were lost to the pandemic.
The job market and the overall economy are under intense pressure from the accelerating pandemic. On Thursday, the nation broke another record in the seven-day rolling average for new cases, hitting nearly 90,000. Daily new cases were also on track for another day above 100,000, with surging numbers reported all around the country, including a combined nearly 25,000 in Texas, Illinois and Florida.
The economy, which had rebounded sharply in the July-September quarter as businesses reopened from virus-related shutdowns, is now expanding more slowly. Many businesses, especially restaurants and bars that had made use of outdoor seating, face a dim future as the weather turns colder. Consumers may also pull back again on shopping, traveling and other activities to avoid contracting the virus.
Friday's report follows the expiration of government stimulus for struggling individuals, businesses and state and local governments and the failure of Congress to provide further aid.
Consumer spending on services like restaurants, health care and haircuts is rising much more slowly this fall after having rebounded in May and June. It remains 7% below the pre-pandemic level — a decline that threatens many labor-intensive parts of the economy. The restaurant reservations website OpenTable shows, for example, that just three-quarters of restaurants are now taking reservations, a decline from three weeks ago.
The slowdown has coincided with the waning of $1,200 checks that were sent to most adults in the spring and a $600-a-week federal jobless benefit that expired in July. That was followed by an additional $300 that lasted through mid-September. A study by JPMorgan Chase found that Americans spent roughly two-thirds of such money by the end of August.
“The economy is on its own against the virus,” said AnnElizabeth Konkel, an economist at the job-posting website Indeed. “Accelerating cases are an ever-present threat during winter, and a virus surge means economic uncertainty for businesses. Until that uncertainty is eliminated, the labor market will struggle to return to what it used to be.”
Memorial Day rang in the unofficial start of summer here in the United States -- and with it, the unofficial start of summer travel. Whether consumers traveled by air or by land, they probably experienced some form of frustration over the weekend. Flyers faced delays and cancellations, and drivers faced the most expensive gas prices ever recorded on Memorial Day. Zach Griff, Senior Aviation Reporter for the Points Guy, joins Cheddar News' Closing Bell to discuss.
Next-generation gaming ecosystem Joystick recently raised $8 million in a seed round and is in the process of raising a $110 million Series A funding round. Gaming ecosystems are a relatively new type of platform in the Web3 space, allowing users to maximize their play-to-earn gaming opportunities, exchange crypto-currencies, and sell their digital assets. Joystick says its platform is flipping the current model on its head by giving players the opportunity to keep 100% of the revenue they earn. Robin Defay, co-founder and CEO of Joystick, and Michael Le, co-founder of Joystick and TikTok content creator, join Cheddar News' Closing Bell to discuss.
Abe Stein, Head of Innovation at Sports Innovation Lab, joins Cheddar News' Closing Bell, where he explains why the top four spots on his company's 2022 list are European soccer clubs and discusses Sports Innovation Lab's plan to publish data on women's pro sports teams in the not-too-distant future.
Joel Birch, Co-Founder and CEO of Stacked, joins Cheddar News' Closing Bell, where he explains why he doesn't see any new catalysts that would lead to a Bitcoin rally at the moment. He also reiterates that now is a good time for long-term Bitcoin investors to buy low.
The dating app Bumble has sponsored bills and pushed lawmakers to criminalize the online practice of sending unsolicited nudes or “cyberflashing." Payton Iheme, Bumble's head of public policy for the Americas, joined Cheddar News to discuss why the app was going after the harassing behavior beyond its own platform. "Now, while we went to work internally in the company, and we created something called private detector to automatically blur those images so the user can decide if they want to see them, there's nothing for the rest of the internet," she said. "And so that's why we went to work with these laws."
The holiday weekend saw Disney+ and Netflix competing head-to-head for streaming views as the Disney behemoth kicked off the unofficial start to summer with its release of "Obi-Wan Kenobi" and Netflix responded with the first part of "Stranger Things" Season 4. The streaming giants caught the eye of Wall Street, and Seth Schachner, the managing director at consultancy Strat Americas, joined Cheddar News to break down the heavy hitters. "This is a very tough, competitive game, and I don't see it getting any easier," he said. "I think you'll probably see more consolidation."
Amid high inflation, shoppers are pinching their pennies in the grocery stores and becoming more frugal when food shopping. However, supermarkets like Kroger are pushing back against passing on the higher costs and demanding reasons for the higher food prices from suppliers.
The founder and president of Cyborg Mobile Kobie Hatcher has been on a strong trajectory to disrupt his industry with a program called The New Technologists. It's not only meant to address the diversity gap within large tech companies but also help pave the way to transform the lives of young BIPOC students. He joined Cheddar News to talk about how he's working to make a difference with the lack of diversity in tech. “There's truly no lack of talent out there. It's just identifying them and letting them know that, hey, I've been in the tech sector for over 20 years. I see you. I know what you can bring, bring it, we need it," Hatcher said.
