The information on openings from the jobs sites provides an up-to-date look at the state of the labor market. Recent history suggests it accurately previews the federal government’s data, which lags by weeks. Activity on Glassdoor, for example, has closely tracked that in the wider jobs market — and it shows new postings leveling off in August:
Indeed.com is reaching roughly similar conclusions, with postings last week showing a 20 percent decline from 2019 levels, according to data it shared with the Wall Street Journal’s Eric Morath.
“Job postings on the site plummeted this spring when the pandemic hit. By May postings were 33% below February’s prepandemic level,” he writes. “But as states allowed many businesses to reopen, demand for labor improved steadily through July, and in August postings were about 12% below the early February level. Since then, the level of postings has largely plateaued and remained well below year-earlier levels. February is typically a low point during the year for hiring.”
The slowing rebound in job openings is the latest evidence that while the economy has made strides toward repairing the destruction the pandemic wrought on employment, it still has a long way to go. The unemployment rate stands at 8.4 percent after employers hired 1.4 million workers in August. But the economy has added back less than half of the 22 million jobs lost during the early months of the crisis.
The August jobs report showed low-wage workers are leading the bounce back while highlighting the distance the labor market still has to go to reach its levels before the pandemic.
The Labor Department on Wednesday released its latest update, which covered jobs market activity through July.
It showed job openings rose by 617,000 in July to stand at 6.6 million overall. There are now about 2.5 workers for every posting, “in stark contrast to a two-year trend in which job vacancies exceeded the number of unemployed,” Bloomberg News’s Vince Golle writes.
But the progress comes with asterisks. “We’re still in a huge jobs hole,” says Julia Pollak, a labor economist at job site ZipRecruiter. “We need a much higher number of job openings to get us back to where we were before the crisis.”
From RSM chief economist Joseph Brusuelas:
The jump in new postings nevertheless exceeded economists’ expectations, a development Glassdoor senior economist Daniel Zhao said could owe to the “enormous amount of churn in the labor market.”
And “there is a certain amount of momentum in the recovery from rehiring of furloughed workers, and the stock of them is decreasing,” Zhao said. “We’re picking the low-hanging fruit of the recovery, and eventually we’re going to run out of that fruit to pick. … There’s still a public heath crisis going on, and it’s still having an enormous impact on consumer and business behavior.”
To his point, the number of people quitting their jobs jumped by 344,000 in July to 2.95 million, the Labor Department report found. “While this is typically a sign of increased confidence, more quits during the pandemic are probably a reflection of virus fear and challenges related to childcare given the current weak state of the labor market,” Oxford Economics’ senior U.S. economist Lydia Boussour wrote in a note.
Wall Street snaps back as Dow closes up more than 400 points.
Tech fueled the bounce: “The Dow Jones industrial average advanced 439.58 points, or 1.6 percent, to close at 27,940.47. The Standard & Poor’s 500-stock index gained 67.12 points, or 2.0 percent, to end at 3,398.96, while the Nasdaq composite jumped 293.87 points, or 2.7 percent, to settle at 11,141,56,” Hamza Shaban reports.
“Technology shares led the rebound, just as they drove the three-day rout that dragged the tech-centric Nasdaq into correction territory. Tesla shot up 10.9 percent after its 21.1 percent free-fall on Tuesday, when it was announced the electric car company had not made the cut for the benchmark S&P 500 as expected. Microsoft jumped 4.3 percent, Apple added 4.0 percent, Amazon climbed 3.8 percent, and Google parent Alphabet moved up 1.6 percent.” (Amazon founder and chief executive Jeff Bezos owns The Washington Post.)
- Traders are very thankful for the Fed: “Jay Powell has become Santa Claus, the Tooth Fairy and a leprechaun with a pot of gold, all wrapped into one,” Kristina Hooper, chief global market strategist at Invesco, tells Hamza. “Now that doesn’t mean stocks won’t be volatile and they won’t have their down days. But we have to recognize that the Fed is a powerful force that is likely to drive investors back into equities, especially tech.”
Short selling proves costly for some investors: “Despite recent market turbulence, the Dow Jones Industrial Average, the S&P 500 index and the Nasdaq Composite are all still up at least 48 percent from their March lows. Traders who have given in to the temptation to go short — borrowing shares, selling them and returning them in the future at what they hope to be a lower price so they can pocket the difference — have often paid a stiff price,” the Wall Street Journal’s Michael Wursthorn and Geoffrey Rogow report.
Latest on the federal pandemic response
The White House is eyeing more executive actions.
The West Wing’s new Plan B comes as Congress remains gridlocked over relief: “With the Senate poised to vote [today] on a slender GOP coronavirus relief bill that’s certain to fail, chances for a bipartisan deal on new economic stimulus look more remote than ever,” Erica Werner and Jeff Stein report.
“White House officials have discussed efforts to unilaterally provide support for the flagging airline industry while also bolstering unemployment benefits. … The White House has also discussed moving without Congress to direct more money for school vouchers and changing Trump’s recent payroll tax changes to make it more effective. Typically, such actions require congressional approval.”
Lawmakers divide over Fed’s Main Street program: “Lawmakers on a top banking panel largely agree that the Federal Reserve’s Main Street lending program has fallen short. But they’re debating whether or how to change the rules and allow the Fed to make more, albeit riskier, loans to struggling businesses,” Rachel Siegel reports.
“At a Senate Banking Committee hearing, policymakers differed over whether the Main Street program can be strengthened with a new structure and relaxed loan terms, or if more direct aid from Congress is needed to help companies fighting for survival during the pandemic. … A core issue is how much risk the Fed and Treasury Department can take under the Cares Act, since any losses are ultimately covered by taxpayers.”
Confused Austrians cash stimulus checks: “Hundreds of people have cashed U.S. stimulus checks at Austrian banks in recent months. Some of them appeared puzzled by the unexpected payments or were ineligible for the payouts, according to bank officials and Austrian media reports,” Rick Noack reports from Berlin.
“It is unclear how many U.S. checks were cashed in Austria by ineligible recipients. Similar instances have been reported in other countries. NPR reported last month that thousands of foreigners who used to temporarily work in the United States had accidentally received stimulus checks.”
From the U.S.:
- Trump acknowledges he intentionally downplayed deadly virus: “Trump acknowledged that he intentionally played down the deadly nature of the rapidly spreading coronavirus last winter as an attempt to avoid a ‘frenzy,’ part of an escalating damage-control effort by his top advisers to contain the fallout from a forthcoming book by The Washington Post’s Bob Woodward,” Josh Dawsey, Felicia Sonmez and Paul Kane report.
- At least 6,328,000 cases have been reported; at least 187,000 have died.
- Emails show HHS tried to muzzle Fauci: “Emails obtained by Politico show Paul Alexander — a senior adviser to Michael Caputo, HHS’s assistant secretary for public affairs — instructing press officers and others at the National Institutes of Health about what Anthony S. Fauci, the nation’s top infectious disease expert, should say during media interviews,” Politico’s Sarah Owermohle reports.
- NIH head said it’s tough to tell when a vaccine will be ready: “Contradicting Trump, the head of the National Institutes of Health Francis Collins said there’s no way to tell if a safe vaccine will be available before the Nov. 3 election. But he remains hopeful that we can have one by year’s end,” Bloomberg News’s Anna Edney, Jacquie Lee, and Riley Griffin report.
- Cases spike among school-aged children in Florida: “Dozens of classrooms — along with some entire schools — have been temporarily shuttered because of coronavirus outbreaks, and infections among school-age children have jumped 34 percent. But parents in many parts of the state don’t know if outbreaks of the virus are related to their own schools because the state ordered some counties to keep health data secret,” Lori Rozsa and Valerie Strauss report from West Palm Beach.
From the corporate front:
- UPS to hire 100,000 seasonal workers: “The world’s largest package delivery company plans to hire about the same number of seasonal holiday helpers as last year. It expects this year’s peak season to extend from October to January — one month longer than last year, as retailers prep for their earliest-ever kickoff,” Reuters reports.
- Mall owners Simon and Brookfield to rescue JC Penney: The two companies “are close to finalizing an $800 million deal to rescue the embattled department store chain,” CNBC’s Lauren Thomas reports. Such a deal would “avoid a total liquidation and saving about 70,000 jobs and 650 stores, Joshua Sussberg of the law firm Kirkland & Ellis said.”
- LVMH pulls out of Tiffany & Co. takeover: “Luxury-goods giant LVMH Moët Hennessy Louis Vuitton SE said it was backing out of its $16.2 billion takeover of Tiffany in a sign of how trade tensions and the pandemic have taken the air out of the highflying luxury industry,” WSJ’s Matthew Dalton and Suzanne Kapner report.
Around the world:
- Experts say safety protections are working as major vaccine trial is halted: “A major coronavirus vaccine trial is on hold as an independent committee investigates whether a case of spinal inflammation in a single British participant is linked to the vaccine — a step that several experts said is a sign of the protections in place to ensure the safety of products ultimately used in millions of healthy people,’” Carolyn Y. Johnson reports.
- British health secretary criticized over asymptomatic testing advice: “British Health Secretary Matt Hancock said that people who do not have symptoms of the novel coronavirus should not request tests … Several opposition Labour Party lawmakers pointed out that health officials had, in recent days, blamed young and often asymptomatic people for spreading the virus over the summer,” Jennifer Hassan reports from London.
Joe Biden pushes a 10 percent tax on companies that offshore jobs.
The former vice president is making a push for working-class voters: “He also promoted a 10 percent tax credit to spur businesses to invest in domestic job creation and boost the U.S. economy. The surtax would apply to the profit that companies reap from U.S. sales of products or services rendered abroad instead of domestically. It would result in a 30.8 percent tax rate on such profit, Biden’s campaign said,” according to Sean Sullivan and Jeff Stein.
- Democrats are also trying to undermine Trump’s economic approval: “Trump allies have looked to public opinion of the president’s economic stewardship, which has generally been more favorable than support for his handling of the pandemic and other issues, as one of the few rays of hope for winning a second term. But Biden has campaigned against the president’s résumé on economic matters and presented a competing vision.”
The Trump campaign raised $210 million in August, far short of Biden’s record haul: “Trump and his Republican Party jointly raised $210 million in August, a robust sum but one dwarfed by the record $364.5 million raised by Democrats and Biden,” Jonathan Lemire of the Associated Press reports.
“Trump’s campaign released its figure Wednesday, several days later than usual and nearly a week after the Biden campaign unveiled its total, the highest for any one month during a presidential campaign. The president’s reelection team said it brought in more money during its party’s convention than the Democrats did in theirs, and officials insisted they ‘will have all the resources we need’ ahead of November.”
James and Kathryn Murdoch are backing Bill Kristol’s anti-Trump group: “A list from the nonpartisan Center for Responsive Politics showing the 2020 election cycle’s top donors ranks the couple 13th among a group of 100 contributors from both parties. Data shows that the Murdochs have contributed over $11 million to political causes, with over $2.5 million going to Democrats,” CNBC’s Brian Schwartz reports.
“Kathryn Murdoch said she sees Trump and his administration standing in the way of several reforms. Murdoch points to Trump’s dismissive attitude toward climate change and his handling of the pandemic, particularly his efforts to push back on the concept of expanded voting by mail, as reasons she believes it’s time for Joe Biden to become president.”
When superpowers collide
TikTok and the administration are talking about ways to avoid a full sale.
Trump’s imposed deadline is quickly approaching: “Discussions around such an option have risen in prominence since the Chinese government took steps that make a sale to a U.S. technology giant like Microsoft Corp. more difficult …” WSJ’s Miriam Gottfried, Georgia Wells and Kate Davidson report.
“A number of options remain on the table, the situation is fluid and a sale is still a possibility. … Even if there isn’t a full sale, the outcome would likely involve some sort of restructuring of TikTok. … That could involve a deal in which TikTok takes on a U.S. technology partner that helps secure its data and potentially takes a minority stake. The main concern for government officials involved in the talks has been the security of TikTok’s data and keeping it out of reach of the Chinese government…”
Meet Bezos’s heir apparent.
The head of Amazon’s web services has emerged as the world’s richest man likely replacement: “The likelihood of Andy Jassy’s being Bezos’s successor increased when the other deputy, Jeff Wilke, who ran Amazon’s retail business, last month unexpectedly announced plans to retire early next year. Wilke, 53, and Jassy shared a spot in the corporate hierarchy and were both seen to be groomed for the top job …,” Jay Greene reports this morning from Seattle.
“To most, Amazon is known as a massive online marketplace where they can buy books, housewares, televisions and more. But Jassy’s Amazon career is defined by his leading Amazon into a wholly new market, cloud computing, a business the company has come to dominate just as aggressively as it leads in the world of e-commerce. And the fact that Jassy is now most likely to succeed Bezos offers insight into Amazon: that the company still values high-risk, high-reward bets and is less defined by online shopping than some might think.”
Franchise workers win victory over effort to curb lawsuits: “A federal judge has struck down key portions of a Trump administration rule that made it more difficult for workers to win lawsuits against companies over violations committed by contractors and franchisees,” the New York Times’s Noam Scheiber reports.
“The rule, which the Labor Department proposed last year and made final in January, raised the bar for employees of a franchise like Burger King or Subway to win a judgment against the parent company if the restaurant violated minimum-wage or overtime laws.”
Zillow, Nextdoor and others are promising to better diversify their ranks: They’ve signed on “to the Board Challenge, a pledge for boards to add a Black director within one year. In addition to those 17, more than 20 other companies with Black directors, including Nordstrom Inc., United Airlines Holdings Inc. and WW International Inc., have joined the group and pledged to use their resources to accelerate diversity efforts,” WSJ’s Anne Steele reports.
“The effort comes about a week after California lawmakers passed a bill that would require publicly traded companies based in the state to have at least one director from a minority community by the close of 2021. California Gov. Gavin Newsom (D) has until the end of September to sign or veto the bill.”
Northrop Grumman wins $13 billion contract to replace U.S. ballistic missiles: The Air Force deal with the Falls Church, Va.-based defense manufacturer marks “a major step forward for an ambitious plan to modernize the nation’s crumbling nuclear missile infrastructure,” Aaron Gregg and Paul Sonne report.
“The award sweeps aside an earlier attempt to challenge the terms of the competition by Boeing, which has led the Pentagon’s ballistic missile work since the Eisenhower administration. And it gives Northrop the lead on a long-term program, estimated to be worth $85 billion or more over the next several decades, that includes almost every major defense manufacturer except Boeing.”
Boris Johnson threatens to override Brexit deal.
E.U. leaders said the move would violate international law. “The proposed legislation could amount to a negotiating tactic as London and Brussels try to hash out a permanent trade deal, to take effect when an 11-month transition period ends in December,” Karia Adam, Michael Birnbaum and William Booth report. “It could also sour Britain’s relationship with its closest European allies, just when it needs them most, and increase the chances that the United Kingdom quits the E.U. without a trade deal in place, risking further economic turmoil in the midst of a pandemic.”
- Nancy Pelosi vows no U.S.-U.K. trade deal if Johnson follows through. The House Speaker laid out the stakes in a Wednesday statement: “If the UK violates that international treaty and Brexit undermines the Good Friday accord, there will be absolutely no chance of a US-UK trade agreement passing the Congress.”
Via Trevor Noren, managing director for 13D Global Strategy and Research:
- The Labor Department reports weekly jobless claims.
- The House Financial Services Committee holds a hearing on aid for states and territories during the pandemic.
- A subcommittee of the House Small Business Committee holds a hearing on the state of the rural economy.
- Peloton, Oracle, Chewy and Dave & Buster’s Entertainment are among the notable companies reporting their earnings.