The Week in Business: Grim Numbers Get Even Worse
There’s no way to sugarcoat what was a truly dismal week, and prospects aren’t much better for the next one. Here’s what you need to know to gear up for the days ahead. Be safe out (or, I should say, in) there. — Charlotte Cowles
What’s Up? (March 29-April 4)
A Bleak Outlook
We knew that the latest report on jobless claims would be staggering, but it was even worse than predicted. More than 6.6 million people filed for unemployment from March 15 to March 21, almost double the record-setting number from the previous week. The total job losses for the past two weeks add up to nearly 10 million — roughly 6 percent of the American work force. It’s a brutal end to a landmark run of job creation that has lasted more than a decade, and things are about to get uglier. The Congressional Budget Office said that unemployment was projected to exceed 10 percent in the next three months — rivaling the 2008 recession — and stay high for some time, remaining at 9 percent even at the end of 2021.
Walking Off the Job
While the coronavirus pandemic has destroyed many businesses, a few — like Amazon and the grocery delivery service Instacart — are booming. But these companies are scrambling to fulfill an influx of orders while maintaining the safety of their employees, some of whom went on strike this past week to demand better health protections like more face masks, hand sanitizer and paid sick leave. Both companies say they have increased precautions, but their workers say they’ll believe it when they see it. Of note: Amazon fired the worker who organized a walkout at its Staten Island warehouse.
Oversharing on Zoom
In this era of social distancing, you’ve probably grown well acquainted with Zoom, the videoconferencing tool that millions of people are now using for remote work check-ins and virtual family dinners. But what you may not know is just how well acquainted Zoom is with your personal data, and how readily it shared that information with Facebook and other people in your Zoom meetings — even when you had your privacy settings on. The company said on Thursday that it had disabled the data-mining feature, but not before it had allowed millions of people to surreptitiously snoop on each other’s LinkedIn profiles. Another security issue the company is working on? “Zoombombing” — when trolls hijack meetings to display graphic or disturbing images.
What’s Next? (April 5-11)
Cautious Hope
The U.S. Food and Drug Administration has given emergency approval for the anti-malaria drug hydroxychloroquine to be prescribed to patients with Covid-19. It’s too early to know if the drug actually works, and the research is inconclusive so far — so it’s basically the medical equivalent of throwing spaghetti at the wall. But one thing is for sure: Social media platforms including Facebook, Twitter, and YouTube are being used to spread claims of its efficacy, and some messages have gone too far. All three tech companies removed videos of a speech by President Jair Bolsonaro of Brazil where he claimed that hydroxychloroquine was curing the disease. But with many experimental treatments flying around, it’ll be extra tough for tech platforms to monitor for harmful misinformation.
A Change of Plan
Remember when WeWork made a disastrous attempt to go public last year and was bailed out by SoftBank, a Japanese conglomerate? (Remember when people still went to co-working spaces?) Well, now SoftBank doesn’t want to follow through with its initial deal to buy $3 billion in WeWork stock from other shareholders, which leaves many of the company’s top executives — including its much-maligned former chief executive, Adam Neumann — holding the bag. WeWork’s board committee said it was “surprised and disappointed” that SoftBank was backing out of the share purchase, which is probably an understatement. It also means that Mr. Neumann, who has been widely blamed for the company’s implosion, won’t walk away with the millions he was originally promised.
Deal or No Deal
President Trump caused a record surge in oil prices this past Thursday when he tweeted that he was expecting an oil deal between Saudi Arabia and Russia that would end their weekslong price war. But Russian officials denied that any such negotiations with Saudi Arabia had taken place, and it appears that the deal might not actually exist. The combination of lower demand for oil and a falling-out between two of the world’s largest oil producers has wreaked havoc on the energy industry, although it has made gas much cheaper — not that you may have noticed, since you’re (hopefully) staying home. On Friday, the Organization of the Petroleum Exporting Countries said it was planning to hold a teleconference on Monday to do damage control and discuss world oil supplies, but then on Saturday, that meeting was postponed.