Economists think the big job gains reported on Friday are just the beginning. One reason: U.S. households had $2.4 trillion in savings in February, $1 trillion more than a year earlier. And that was before the latest wave of $1,400 relief checks started going out in March.
The primary factor holding back spending has been the pandemic, which has prevented people from spending on restaurant meals, vacations and concert tickets. But with the vaccine rollout accelerating, that could soon change.
About 35 percent of Americans plan to spend more on travel over the next 12 months than they do in a typical year, according to a survey conducted last month for The New York Times by the online research firm SurveyMonkey. About 28 percent plan to spend more than usual at restaurants. And over all, close to 70 percent of adults plan to spend more than usual in at least one category, at least if the health situation allows.
“They have the money in the bank, they’re ready to spend it, but what was holding them back was not having a comfort about being able to go out,” said Jay Bryson, chief economist for Wells Fargo. “We’re getting into a critical mass of people that are feeling comfortable beginning to go out again.”
But there are signs that Americans remain cautious. The survey was conducted in mid-March, just as the Treasury was preparing to send the $1,400 checks to millions of households. More than half the survey respondents who expected to receive checks said they planned to save most of the money or pay down debt. One-third said they would use it for immediate needs like food or rent. Only 10 percent said they planned to spend most of the money on discretionary items.
And while many Americans may be dreaming up ways to spend the money they saved during the pandemic, those hardest hit by the crisis are still trying to regain their financial footing. Among the unemployed, 62 percent said they planned to use their stimulus check to meet immediate needs, compared with 29 percent of the employed. Only 3 percent of the unemployed said they planned to use their stimulus checks on discretionary purchases.
Waymo, the autonomous car unit of Google’s parent company, Alphabet, said John Krafcik is stepping down as chief executive after five and a half years at the helm.
In a statement, Waymo said the chief executive duties will be divided between two current company executives — Tekedra Mawakana and Dmitri Dolgov. Ms. Mawakana was Waymo’s chief operating officer, and Mr. Dolgov was the company’s chief technology officer before the promotion.
In a blog post announcing the move, Mr. Krafcik, 59, did not specify a reason for why he was stepping down at this moment other than to say he was pursuing “new adventures.” Waymo said it was Mr. Krafcik’s decision and that he plans to remain an adviser to the company.
Mr. Krafcik, a longtime auto industry executive who oversaw Hyundai Motor’s U.S. operations, joined Waymo in 2015 when it was still part of Google. During his tenure, Google spun out Waymo into a separate subsidiary of Alphabet, and the company raised more than $3 billion from outside investors in a move that signaled a greater independence from its parent company.
Google and Waymo have pursued self-driving car technology for more than a decade. Waymo has launched its own autonomous taxi service in the greater Phoenix area called Waymo One, and the company has struck partnerships with a handful of car manufacturers, including Volvo and Jaguar Land Rover, to build its self-driving technology into their vehicles.
Ms. Mawakana joined Waymo four years ago as the global head of policy and has been the company’s operating chief for the last two years. Before that she worked in policy positions at eBay, Yahoo and AOL.
Mr. Dolgov is one of the original employees who started Google’s self-driving car project in 2009 and is considered one of the leading technical experts in autonomous vehicle technology.
Tesla said on Friday that it more than doubled the number of cars it delivered in the first quarter, bouncing back after the pandemic slowed sales in the same period a year ago.
The electric carmaker said it sold 184,8000 vehicles in the first three months of the year, up from 88,500 a year ago. It produced 180,338 vehicles, compared with 102,672 in the first quarter of 2020.
The company’s sales numbers, which cover the entire world, come a day after General Motors and Ford Motor reported that their U.S. sales were up modestly. Tesla does not break out its sales by region and a lot of its recent growth has been in China, where electric cars make up a much larger share of the auto market than in the United States.
Tesla was helped by the arrival of the Model Y, a roomier version of its Model 3 sedan. Those two cars accounted for almost all of its deliveries in the first quarter. It reported just 2,020 deliveries of its high-end cars — the Model S luxury sedan and the Model X sport-utility vehicle.
Tesla has halted production of the Model S and Model X while preparing its plant in Fremont, Calif., to build updated versions of the cars. The company said in a statement that it was “in the early stages of ramping production” of the new models, which generate much more profit than the Model 3 and Model Y.
The first-quarter sales numbers could lift Tesla shares, which have lost more than a quarter of their value since January when they hit a high of about $900. The impact won’t be known until next week, however, because the stock market is closed in observance of Good Friday. On Thursday, Tesla’s stock fell about 1 percent, closing at $661.75.
Analysts were surprised by the jump in sales. Most had been expecting deliveries of about 172,000 vehicles.
“The company yet again defied the skeptics and bears,” Dan Ives, a Wedbush analyst, said in a report. “It’s been a brutal sell-off for Tesla and EVs, but we believe that will now be in the rear view mirror.”
More large companies have voiced their opposition to Republican-led efforts to restrict voting, this time in Texas.
On Thursday, American Airlines and Dell Technologies declared their objections to proposals in the state that would restrict local measures intended to make voting easier, such as by extending early voting hours.
The pushback in Texas came just a day after Delta Air Lines and Coca-Cola spoke out against similar efforts in Georgia, though both companies waited until after Georgia’s governor had already signed the law to criticize it.
“I need to make it crystal clear that the final bill is unacceptable and does not match Delta’s values,” Ed Bastian, Delta’s chief executive, wrote in an internal memo to employees on Wednesday that the company has posted on its website. Delta is Georgia’s largest employer.
The language was much stronger than Delta had used in advance of the passage of the law, when the company made only general statements in support of voting rights but declined to take a position on the legislation. Coca-Cola, which had also declined to take a position on the legislation before it passed, made a similarly worded statement.
Those comments came a day after a group of Black executives, led by the former chief executive of American Express and the current chief executive of the drugmaker Merck, called on companies to oppose proposed bills making it more difficult to vote across the country — saying that they would particularly impact the voting rights of Black Americans.
On Thursday, American Airlines and Dell each addressed separate bills making their way through the Texas legislature.
“Earlier this morning, the Texas State Senate passed legislation with provisions that limit voting access, ” the airline said in a statement on Thursday, referring to Senate Bill 7. “To make American’s stance clear: We are strongly opposed to this bill and others like it.”
Michael Dell, the chief executive of the Round Rock, Texas-based company that bears his name, took to Twitter to voice his company’s opposition to House Bill 6, a measure that would stop local election officials from proactively sending out applications for mail-in ballots.
“Free, fair, equitable access to voting is the foundation of American democracy,” Mr. Dell wrote on Thursday. “Those rights — especially for women, communities of color — have been hard-earned. Governments should ensure citizens have their voices heard. HB6 does the opposite, and we are opposed to it.”
Southwest Airlines, which is based in Dallas, declined to comment on specific legislation. “In our view, the right to vote is foundational to our democracy and a right coveted by all,” the company said in a statement on Friday. “We believe every voter should have a fair opportunity to let their voice be heard.”
In a firm rebuke of Georgia’s new elections law, Major League Baseball said Friday that it had abandoned its plan to play this summer’s All-Star Game in Atlanta.
The baseball commissioner, Rob Manfred, made the decision after days of pressure from civil rights groups and the Major League Baseball Players Association.
After conversations with teams, players, former stars and players’ union officials, Mr. Manfred said in a statement that he had concluded that “the best way to demonstrate our values as a sport is by relocating this year’s All-Star Game and M.L.B. draft,” James Wagner and Kevin Draper report for The New York Times. The league said it was still completing details on new locations for the game and the draft.
The law has been facing increasing criticism, including from Delta Air Lines and Coca-Cola, major Georgia employers that had remained silent as Georgia Republicans rushed to pass it last month.
In the face of mounting outrage from activists, customers and a coalition of powerful Black executives, Delta’s chief executive, Ed Bastian, made a stark reversal. “I need to make it crystal clear that the final bill is unacceptable and does not match Delta’s values,” he wrote in an internal memo that was reviewed by The Times.
Coca-Cola made a similarly worded statement. “I want to be crystal clear,” said James Quincey, its chief executive. “The Coca-Cola Company does not support this legislation, as it makes it harder for people to vote, not easier.”
The companies now face backlash from Republicans. Gov. Brian Kemp accused Mr. Bastian of spreading “the same false attacks being repeated by partisan activists.” And Republicans in the Georgia legislature have floated the idea of increasing taxes on Delta as retribution. On Thursday, Senator Marco Rubio of Florida posted a video in which he called Delta and Coca-Cola “woke corporate hypocrites.”
As the labor market heals at different paces for different demographic groups, women — who had been hit especially hard early in the downturn — are staging a particularly strong rebound.
Unemployment for women spiked at the onset of the pandemic, jumping to 16.1 percent in April, and their labor force participation dropped sharply. Now, their labor market experiences are improving along both dimensions: The unemployment rate for women fell to 5.9 percent in March, lower than that for men, and the share of women either working or looking for work nudged higher.
Women had been hit hard economically by pandemic shutdowns both because they work more often in jobs that were lost amid local lockdowns — from teaching to restaurant serving — and because they have shouldered a heavy share of caregiving responsibilities as day care centers and schools closed. Now, as state and local economies reopen, those trends are reversing.
“You open schools, and imagine what happens — women return to the work force,” said Diane Swonk, chief economist for the accounting firm Grant Thornton.
Other demographic groups that had borne much of the pandemic’s fallout remain far behind, however. Unemployment rates are falling across racial and ethnic groups, but the rate for Black workers stood at 9.6 percent last month. That figure is far higher than the 5.4 percent for white workers, and it is falling much more slowly.
The uneven healing has been a focal point for the Federal Reserve, which is focused on how far the job market has to go to get back to full strength.
“The K-shaped labor market recovery remains uneven across racial groups, industries, and wage levels,” Lael Brainard, a Fed governor, said during a recent speech — referring to the divergence in economic fates between those doing fine and those doing poorly, which looks like a “K” when drawn on a graph. “We are far from our broad-based and inclusive maximum-employment goal.”
Ben Casselman contributed reporting.
The labor market is healing, pushing the unemployment rate steadily lower. But alternative measures of the job market show more weakness remaining than the most frequently cited data might suggest.
When the pandemic hit the economy, two big issues began to mess with the unemployment rate. A big chunk of people were classified as “employed but not at work” when they should have been counted as laid off. And many people dropped out of the labor market altogether. Since the unemployment rate only counts people who are actively applying to jobs, that means a lot of would-be workers were suddenly left out.
The jobless rate fell to 6 percent in March from a high of 14.8 percent in April, but that overstates the labor market’s healing. An expanded measure that adjusts for misclassified workers and those on the sidelines — using a methodology that closely tracks a gauge Federal Reserve officials often reference — shows that the “real” unemployment rate was around 9.1 percent in March.
To be sure, that expanded measure is down sharply from a peak of nearly 24 percent last April. But it shows the extent of the damage yet to be repaired since the pandemic shuttered broad parts of the economy in 2020.
Fed officials, who are tasked with returning the labor market to maximum employment, are keeping a close eye on broad measures of slack as they try to assess how far the job market remains from full strength. Another point they often raise is that total employment in the economy remains well below its prepandemic level — as of March, 8.4 million jobs were missing compared with February 2020.
“It’s just a lot of people who need to get back to work and it’s not going to happen overnight, it’s going to take some time,” Jerome H. Powell, the Federal Reserve chair, said at a news conference last month.
The stronger-than-expected job gains in March were also surprisingly broad-based.
Forecasters had expected the lifting of restrictions in Texas and other states to lead to a surge in hiring at restaurants, hotels and related businesses. They were right: The leisure and hospitality sector added 280,000 jobs.
But hiring was also strong in other industries. Retailers and wholesalers added more than 20,000 jobs apiece. Manufacturers added 53,000. Construction businesses added 110,000 as activity resumed after winter storms hit the South in February. Public and private education added a combined 190,000 jobs as schools reopened across the country.
Diane Swonk, chief economist at the accounting firm Grant Thornton, said the widespread gains showed that the recovery was being driven by more than just the reopening of previously shuttered businesses. Government aid has given Americans money to spend, and the confidence to spend it.
Businesses, too, appear to be growing more confident. Many of the jobs added in January and February were temporary positions, but in March, temporary staffing levels were essentially flat, indicating companies were filling permanent positions instead.
“That’s also a sign of optimism that the rebound we’re seeing will be sustained,” Ms. Swonk said.
Amy Glaser, senior vice president at the staffing firm Adecco, said that in recent weeks, a growing share of her clients had been looking for permanent employees, or converting temporary hires into permanent ones.
“Our conversations have really shifted even over the last six weeks,” she said. “We spent the last year doing a lot of worst-case-scenario planning with our clients, and now the conversation is the opposite — how do we capture the rebound to make the most effective use of it?”
read on: other key stories in washington and politics
President Biden touted Friday’s strong jobs report as proof that his focus on the pandemic and passage of a $1.9 trillion coronavirus relief package is working, and he called on Congress to quickly pass a new infrastructure bill he says will create 19 million new jobs.
“The first two months of our administration has seen more new jobs created than the first two months of any administration in history. But we still have a long way to go,” said Mr. Biden in a brief statement at the White House before a planned trip to Camp David for the Easter holiday.
Mr. Biden said he was willing to compromise with Republicans on the details of his $2.3 trillion proposal, but warned that “inaction is not an option.”
Employers added 916,000 jobs in March, up from 416,000 in February and the most since August, the Labor Department said Friday, led by a robust rebound in the hard-hit restaurant, resort and construction sectors.
The heartening numbers, while not unexpected, come at a critical political moment for Mr. Biden and his allies as they make their case for the infrastructure proposal titled “The American Jobs Plan” — one which Republicans deride as a “job killer” because it hikes taxes on corporations and high earners.
Mr. Biden’s team is packed with veterans from the Obama White House intent on leveraging the good news for maximum gain. They are also determined to learn from the messaging missteps during President Barack Obama’s first term, when they were wary of trumpeting economic news for fear of prompting a political backlash, according to administration officials. Mr. Obama’s advisers struggled to take credit for a sluggish, stop-and-start recovery that began much later in his presidency.
While Mr. Biden went out of his way to credit “the American people” for the gains, Ron Klain, his chief of staff, wrote on Twitter earlier Friday that “Help is here,” employing the cavalry-has-arrived slogan that Mr. Biden has often used.
“It puts the wind in their sails, the spring in their step — now they’ve got the momentum,” said Rahm Emanuel, Mr. Obama’s first chief of staff.
With the pandemic, Mr. Emanuel argued, the president has “a different permission slip” than Mr. Obama.
“The virus has been around for a year, and the meltdown associated with the virus seems to be coming to an end. Today people have empathy for 500,000 lost lives and their families. Back then people wanted to kill 500,000 bankers,” said Mr. Emanuel, the former mayor of Chicago.
But the Biden administration is also trying to strike the right balance between sobriety and self-congratulation, mindful of not appearing insensitive to the millions of Americans still suffering hardship from the devastation and dislocation caused by the pandemic.
Cecilia E. Rouse, chair of the Council of Economic Advisers, speaking on MSNBC after the numbers were announced, cautioned that while the report “suggests confidence is building” in the recovery, “we’re still 8.4 million jobs fewer than we were at this time last year.”
When a reporter asked Mr. Biden how he planned to woo Republicans for his infrastructure plan, the president questioned how his congressional opponents could oppose some of the proposal’s provisions, especially funding to eliminate lead pipes.
It would be quickly passed, he said, if lead was found in water fountains on Capitol Hill.
Mr. Biden also mocked his predecessor, former President Donald J. Trump, for promising but not delivering on pledges to pass his own infrastructure bill.
“Every second week was infrastructure week, but no infrastructure was ever built,” he said.
For months, Saudi Arabia’s oil minister, Prince Abdulaziz bin Salman, arguably the most powerful individual in the oil business, has urged his fellow producers to keep a tight rein on output, fearing additional crude could flood the world’s markets and cause prices to drop. At the same time, some producers, notably Russia, have been chafing to open the spigot a bit more.
On Thursday, the prince seemed to relent, as the group called OPEC Plus — the members of Organization of the Petroleum Exporting Countries and allies like Russia — agreed to modest output increases over the next three months.
Analysts said the prince, who is the chair of OPEC Plus, appeared to be calculating that by appeasing other producers who want to produce more oil, he can remain in control over the longer term.
The prince repeated his go-slow message on Thursday, arguing that the global economic recovery from the pandemic remained fragile, and so his willingness to sign off on an increase came as something of a surprise. But the decision seemed to be an acknowledgment of the diversity of opinions within OPEC Plus, and that he must take the views of other key producers like Russia and the United Arab Emirates into account to maintain leadership and to keep them from going their own way.
“It is not my decision, it is everybody’s decision,” he said at a news conference after Thursday’s OPEC Plus meeting.
So far traders have signaled their approval by pushing up prices in what had been a weak market. On Friday, Brent crude, the international benchmark was up about 3.4 percent to $64.86 a barrel.
Under the deal agreed to on Thursday, OPEC Plus will gradually increase production by 350,000 barrels a day in May and June and 441,000 barrels a day in July. Over the same period, the Saudis will also relax the one million barrels a day they have been voluntarily keeping off the market, bringing the total increase to about 2.1 million barrels a day by July.
The plan “points to a still cautious and orderly ramp-up from OPEC Plus, still allowing for a tight oil market,” rather than a flood, analysts at Goldman Sachs wrote in a note to clients on Thursday.
OPEC Plus also retain the option of adjusting output at monthly meetings. Saudi Arabia, the world’s largest exporter, can also take unilateral decisions to trim supplies.
This ability to quickly backtrack “provides the prince with comfort that he is exercising a fairly low-risk option,” Helima Croft, a strategist at RBC Capital Markets, wrote in a note to clients.
In the fallout of Brooks Brothers’ bankruptcy filing and sale last year, the retailer abandoned a warehouse in Connecticut full of junk — mannequins, sewing machines and a whole section of Christmas trees.
Ever since, the couple that owns the warehouse, Chip and Rosanna LaBonte, has been scrambling to figure out how to get rid of it all.
Junk removal companies have told them it will cost at least $240,000 to clear the space, which Brooks Brothers had rented through November, Sapna Maheshwari and Vanessa Friedman report for The New York Times. In order to pay the bill, the LaBontes are going to have to sell their home.
Brooks Brothers, which was founded in 1818 and is the oldest continuously operated apparel brand in the United States, began renting the warehouse in Enfield in 2011, most recently at a rate of roughly $20,000 a month.
The couple bought the warehouse in 2010. They said that it was their first foray into commercial real estate and that they worked on residential projects before that. They have other tenants and a self-storage section, but are frustrated about the mess and the fact they can’t use the space for anything else until it is cleared.
The couple’s plight illustrates the far-reaching consequences of retail bankruptcies, which cascaded during the pandemic and affected everyone from factory workers to executives. Smaller vendors and landlords have often been left holding the short end of the stick during lengthy byzantine bankruptcy proceedings, particularly with limits on what they can spend on legal bills compared with larger corporations. And once bankrupt brands are sold, people like the LaBontes are typically left in the dust.
In today’s On Tech newsletter, Shira Ovide looks at the White House’s proposal to spend $100 billion to extend fast internet access to every home, and explains why the plan could be the shakeout we need.
