A man wearing a mask walks by Century 21 department store, Wednesday, Sept. 30, 2020 in the Brooklyn borough of New York. The discount department store chain has filed for Chapter 11 bankruptcy protection and is closing its 13 stores. (AP Photo/Mark Lennihan)
By Christopher Rugaber
The number of Americans seeking unemployment benefits declined last week to a still-high 837,000, evidence that the economy is struggling to sustain a tentative recovery that began this summer.
The Labor Department's report, released Thursday, suggests that companies are still cutting a historically high number of jobs, though the weekly numbers have become less reliable as states have increased their efforts to root out fraudulent claims and process earlier applications that have piled up.
For example, California, which accounts for more than one-quarter of aid applications, simply provided the same figure it submitted the previous week. The state had said it would stop accepting jobless claims online so it could tackle a backlog of 600,000 claims.
Measures of the U.S. economy have been sending mixed signals. Consumer confidence jumped in September, fueled by optimism among higher-income households, though it remains below pre-pandemic levels. And a measure of pending home sales rose in August to a record high, lifted by ultra-low mortgage rates.
Yet some real-time measures indicate that growth has lost momentum with the viral pandemic still squeezing many employers, especially small retailers, hotels, restaurants and airlines, nearly seven months after it paralyzed the economy. An economic index compiled by the Federal Reserve Bank of New York grew in September at a weaker pace than during the summer months.
In its report on jobless claims Thursday, the Labor Department said the number of people who are continuing to receive benefits fell to 11.8 million, extending a steady decline since spring. That suggests that many of the unemployed are being recalled to their old jobs.
But it also reflects the fact that tens of thousands of jobless Americans have exhausted their regular state unemployment benefits. Some of them are likely transitioning to an extended jobless aid program that provides benefits for an additional three months.
Weekly applications for unemployment benefits are typically watched as a proxy for layoffs, although the data has become muddied in recent months. The flood of laid-off workers during the pandemic recession overwhelmed state agencies.
Congress also made millions of contractors and self-employed people eligible for jobless aid for the first time through a new program that is managed by state agencies. This program has further burdened the states.
The states’ efforts to clear backlogs and uncover fraud in the new program have made it harder to interpret the government’s report on unemployment benefits. Many economists no longer consider it a clear sign of the pace of layoffs.
Initial jobless claims are stuck above the highest levels reached in the 2008-2009 Great Recession. But last week, economists at Goldman Sachs noted that according to other government data, layoffs have fallen below the peaks of a decade ago.
Still, many large companies are announcing further layoffs.
The Walt Disney Co. said this week that it’s cutting 28,000 jobs in California and Florida, a consequence of the damage it’s suffered from the viral outbreak and the shutdowns and attendance limits that were imposed in response.
Allstate said it will shed 3,800 jobs — 7.5% of its workforce. And tens of thousands of airline workers will lose their jobs this month as federal aid to the airlines expires. The airlines were barred from cutting jobs as long as they were receiving the government assistance.
Late Wednesday, two of them — American and United — announced that they would begin to furlough 32,000 employees after lawmakers and the White House failed to agree on a pandemic relief package that would extend the aid to airlines.
On Friday, the government will issue the jobs report for September, the final such report before Election Day, Nov. 3. Analysts have forecast that it will show a gain of 850,000, which would mark the third straight monthly slowdown in job growth. It would mean that the economy has regained just over half the 22 million jobs that were lost to the pandemic.
The unemployment rate is expected to decline from 8.4% to 8.2%, according to data provider FactSet.
Miami wants to be the crypto capital of the world. Mayor Francis Suarez has gone all in on the blockchain, even accepting one of his first paychecks in Bitcoin, hosting one of the world's largest digital cryptocurrency conferences, and marketing Miami as a great place for tech experts to work. Maja Vujinovic, managing director of OGroupLLC, joined Cheddar's Fast Forward to discuss Miami's enthusiasm toward crypto, some of the potential risks that entails, and where the city might be heading when it comes to the crypto takeover.
Like so many other cities, Miami experienced a tourism boom over the summer after vaccines were distributed. But, the Omicron variant has thrown the travel industry for a loop. David Whitaker, president and CEO of the Greater Miami Convention and Visitors Bureau, joined Cheddar to discuss the city as a tourist destination, and how it has handled headwinds from the pandemic.
Miami's real estate market has boomed since early 2020, thanks to an overall strong housing market, remote work, and no income tax as incentives. The city is preparing to welcome even more residents as people relocate to warmer climates to work from home. Garrett Derderian, director of market intelligence at SERHANT, joined Cheddar to discuss the Magic City's red hot market.
Rockstar Energy, a subsidiary of Pepsico, unveiled its new beverage brand, Rockstar Unplugged, changing up the energy drink formula with hemp seed oil as an ingredient. PepsiCo Energy CMO Fabiola Torres joined Cheddar News to talk about how the product promotes “good vibes” and allows consumers to unwind and discuss partnering with "MTV Unplugged" for a concert series. "We couldn't find a better partnership that MTV," she said. "MTV Unplugged has been such an iconic proposition … and we believe that we're the right partners because the insight of our proposition for Rockstar Unplugged comes from music.
Eight months after the National Football League announced $1 million in research into cannabinoids, the NFL-NFLPA Joint Pain Management Committee has awarded the funding to two teams of medical researchers at the University of California San Diego and the University of Regina. The NFL says the studies will investigate the effects of cannabinoids on pain management and neuroprotection from concussion in elite football players, respectively. Cheddar correspondent Chloe Ailello spoke with Jeff Miller, the executive vice president of communications, public affairs, and policy for the NFL, about the studies, as well as the recent lawsuit filed against the NFL by former Miami Dolphins head coach Brian Flores. "Maybe we can learn things from other alternative pain approaches that are going to benefit our player population and then sports medicine as a whole," Miller said.
All Hands celebrates Black History Month by highlighting achievements in inclusivity and paying homage to those who have fought for equal rights. Rep. Maxine Waters (D-CA) joins Cheddar News to discuss voter suppression; Damali Peterman, CEO of Breakthrough ADR, elaborates on the biggest barriers for Black professionals; Andre Perry, senior fellow of Brookings Institution, dives into student loans and the racial wealth divide; and lastly, BET CEO Scott Mills discusses the company's initiatives for 2022.
Hinge users who have children can opt-in to a $100 stipend up to $25,000 for childcare. Logan Ury, the director of relationship science for the online dating platform, noted the issue as an obstacle for single parents who want to go out on dates. "We have heard that singles with children have a hard time going on dates for one of the reasons being that it's just hard to find childcare and it's hard to be able to afford it," she said. Ury also said that the hot topic among Hinge's users is mental health and the prioritizing of mental health.
According to the Federal Reserve, the investment gap between Black and white Americans has remained substantial, with only 34 percent of Black households joining in on the historic rise in the markets. Stacey Tisdale, the first Black woman to have reported from the NYSE and the CEO and president of Mind Money Media Inc., said that the data might not be as disheartening as it seems. "I think that number is very deceiving. That Federal Reserve study is actually from 2019, and it's very important that we all look beneath that number and look beneath the surface because there is nothing short of an investing revolution going on in the Black community," Tisdale said.
