Jobs Report August 2020: Live Updates

Jobs Report August 2020: Live Updates

Credit…Rogelio V. Solis/Associated Press

Labor Department data on Friday morning is expected to show that employers continued to bring back furloughed workers last month but at a far slower pace than in the spring, and that millions of Americans remain out of work.

Economists surveyed by FactSet estimate that the U.S. economy added 1.4 million jobs in August, down from 1.8 million in July and 4.8 million in June. That would leave payrolls more than 11 million jobs below their pre-pandemic level.

The unemployment rate is expected to fall to 9.8 percent, from 10.2 percent in July. While that rate would be below the peak in the last recession a decade ago, when unemployment briefly hit 10 percent, it would still be higher than in many other past recessions.

“Our worry is that the recovery is showing signs of stalling,” said Beth Ann Bovino, chief U.S. economist for S&P Global. “We still have a long way to go.”

The report will provide some of the first clear data on the state of the economy as emergency federal spending winds down, including a $600 weekly supplement to unemployment benefits that helped keep many households afloat early in the pandemic.

But because the August jobs data was collected early in the month, it may not reflect the full impact of the loss of benefits, economists warn. That calendar quirk could have political ramifications: A relatively solid jobs report could ease pressure on Congress to agree on a new round of emergency spending.

Economists warn that would set the stage for a big drop in spending in the fall, leading to more job losses and a wave of small-business failures.

“I am more concerned about where the economy is now than I was in April,” said Martha Gimbel, an economist and labor market expert at Schmidt Futures, a philanthropic initiative. “In April, it was fixable. We’re just letting the scars build up now.”

Credit…Andrew Testa for The New York Times

The British economy has rebounded faster than expected out of its deepest recession on record, but the circumstances that let that happen are already disappearing, a central banker warned.

It is “quite likely” that the U.K. will need more monetary stimulus, Michael Saunders, a member of the Bank of England’s interest rate-setting committee, said in a speech on Friday.

“The economy in June, July and August has benefited from a relatively benign confluence of factors,” Mr. Saunders said. Government spending and other fiscal support were very high, while the easing of lockdown restrictions boosted spending. “Even that very limited sweet spot may now be fading,” he said.

Coronavirus infection rates in the U.K. and Europe are rising again, and consumer confidence has stalled, Mr. Saunders added. Meanwhile, the government’s plans to roll back spending measures will reduce net fiscal support to an average of £15 billion ($19.9 billion) in each of the next two quarters, about 2 to 3 percent of gross domestic product. Between April and June, fiscal stimulus amounted to 19 percent of G.D.P.

“I do not interpret the economy’s recovery in the last few months as a strong signal that further upside surprises lie ahead,” Mr. Saunders said.

Earlier this week, two other policymakers said the British economy might experience longer-term impacts and a slower recovery than the central bank had most recently forecast.

Credit…Justin Sullivan/Getty Images

In March, when the Trump administration ordered up a study enabling the widespread release of the malaria drug hydroxychloroquine to treat Covid-19, one of the first questions the director of a government research agency that would oversee the trial asked was: “Who has talked with Oracle?”

The Silicon Valley powerhouse had already started to prepare to help with collecting data about the drug, and its founder, Larry Ellison, talked to President Trump about its possible use.

Some tech companies may have shied away from helping to test a drug that many medical experts said had potentially dangerous side effects and might not even work for Covid-19 cases. But Oracle, a business software giant founded in 1977, is a prominent ally of Mr. Trump, whose administration was invested in the drug’s use.

Oracle’s involvement in the planned drug study was its latest effort to aid the president and his administration. The company has also backed the administration’s trade plans and its positions on major tech policy issues, and its executives played roles in Mr. Trump’s transition team in 2016 and have backed his re-election campaign.

Now, as it tries to buy the U.S. operations of TikTok, the viral social media app, its embrace of the administration could be helpful. Mr. Trump ordered the app’s Chinese parent company, ByteDance, to sell the product, citing national security concerns, and his administration must bless any deal.

Mr. Trump has declined to say whether the company is a better suitor for the app than Microsoft, another major bidder. But he said last month that Oracle “would be certainly somebody that could handle it.” The negotiations hit a snag in recent days, after the Chinese government issued new export rules that seem to make a sale more complicated.

Credit…Justin Lane/EPA, via Shutterstock
  • U.S. stock futures were mixed, following a sell-off on Wall Street that wiped out a week of gains. On Thursday, the S&P 500 suffered its worst drop since June as tech stocks tumbled. The S&P dropped 3.5 percent while the Dow Jones industrial average ended the day down more than 800 points.

  • Tech stocks, including Amazon and Zoom, continued lower in pre-market trading Friday. Futures for the tech-heavy Nasdaq composite were down more than 1 percent.

  • Stocks had been on a significant tear. Before Thursday, the S&P 500 had been up in nine of the last 10 sessions.

  • European markets rose on Friday, with benchmark indexes up from half a percent to 1 percent.

  • Asian markets fell on Friday, following Wall Street’s plunge, with indexes closing down roughly 1 percent.

  • Investors were awaiting the monthly jobs report from the U.S. Labor Department on Friday morning, which economists estimate will show 1.4 million jobs were added in August — a slower pace of recovery than in previous months. Thursday’s report on weekly jobless claims showed that filings remained high.

Credit…Jeenah Moon for The New York Times
  • FedEx said Thursday that it plans to hire 70,000 U.S. workers to prepare for an upcoming holiday season in which many consumers will be housebound and reliant on online shopping — and package delivery. That’s a 27 percent increase from last year, when the company brought on 55,000 workers to prepare for the holidays. FedEx also announced plans to expand year-round Sunday residential coverage for its FedEx Ground service to nearly 95 percent of the U.S. population, effective September 13.

  • The Justice Department plans to bring an antitrust case against Google as soon as this month, after Attorney General William P. Barr overruled career lawyers who said they needed more time to build a strong case against one of the world’s wealthiest, most formidable technology companies, according to five people briefed on internal department conversations. Justice Department officials told lawyers involved in the antitrust inquiry into Alphabet, the parent company of Google and YouTube, to wrap up their work by the end of September, according to three of the people.

  • Moving to combat its worst recession in decades, France unveiled a 100 billion euro ($118 billion) stimulus plan Thursday aimed at restoring the battered economy to pre-crisis levels by 2022, handing companies large tax cuts and hiring subsidies in the hope of stimulating investment and creating jobs. The package, the biggest spending effort in Europe, comes on top of nearly €400 billion that President Emmanuel Macron made available to help keep thousands of business from going bankrupt and millions of people employed since a nationwide quarantine caused the economy to crater. Growth is expected to contract by 11 percent this year because of the pandemic.

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