Thursday is the day of the week that brings on the employment report. See below for those details along with an update on the last-minute effort to agree on federal aid.
The Senate on Wednesday passed a short-term funding bill just hours before the deadline to prevent a government shutdown. Senators voted 84 to 10 to keep the government funded at current levels through December 11, setting up another funding fight after the November elections and right before the holidays. The funding bill, passed by the House earlier this month, now heads to President Trump’s desk, where he is expected to sign it before midnight to keep the government running.
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Weekly Employment Report
First-time claims for unemployment insurance totaled 837,000 last week, the Labor Department said Thursday as the jobs market continues its plodding recovery from the coronavirus pandemic.
Economists surveyed by Dow Jones had been expecting 850,000. The weekly total represented a decline of 36,000 from the previous week’s upwardly revised 870,000, according to seasonally adjusted numbers.
Continuing claims provided some better news, with those collecting benefits for at least two weeks falling by 980,000 to 11.77 million. The continuing claims number runs a week behind.
Those collecting benefits under the Pandemic Unemployment Assistance program edged higher to 650,120. The program provides payments to those not normally eligible for benefits, such as freelancers and independent contractors.
The total for all those collecting benefits under the various government programs rose by nearly half a million to 25.53 million for the week ended Sept. 12.
More than two-thirds of individual states reported declines last week, according to unadjusted data. The biggest drops came from Florida, with 9,668, and Texas, with 8,353.
Final Update on Federal Aid Negotiations?
The lead negotiators haggling for another round of emergency coronavirus relief met in person Wednesday for the first time in weeks, with both sides citing headway in the search for an elusive compromise, but no deal to report.
Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin huddled for roughly 90 minutes in the Speaker’s office in the Capitol, emerging with hopes that an evasive bipartisan agreement is within their grasp. “We’re gonna go back and do a little more work again,” Mnuchin said. “I think we’ve made a lot of progress in a lot of areas.” Pelosi offered a similar assessment, pointing to unspecified issues where the sides “are seeking further clarification.”
Before the meeting, Mnuchin told CNBC, “We’re going to give it one more serious try to get this done, and I think we’re hopeful that we can get something done.”
With that said, Senate Majority Leader Mitch McConnell is not going to put a bill on the floor that doesn’t command the support of a majority of Senate Republicans and a bill north of $1 trillion won’t accomplish that. So, IF Pelosi and Mnuchin come up with a deal, they still need to include McConnell’s support. He made clear Wednesday what he thought of the negotiations: They are “very, very far apart.”
So, if a deal is brokered, it will take another week or more to see any action. Reports say these three items seems to be the biggest obstacles and/or most focused on:
- State and local funding – Democrats want roughly $500 billion, and Republicans are near $250 billion
- K-12 funding ($225 billion for Democrats and $150 billion for Republicans)
- A host of tax provisions, some related to health care
**Update – the morning talks did not produce much movement, mainly just an exercise on further clarifications on amounts and language. Pelosi and Mnuchin were supposed to meet again in the afternoon.
Without A Relief Bill, How Would Presidential Nominees Handle Aid
Here is a question for both of our Presidential nominees. How will you target support to those businesses, workers, and communities that find themselves on the downward trajectory of the K-Shaped recovery that’s now unfolding?
In recent months, the hope of a V-Shaped recovery (a sharp and widespread snapback) has faded, yielding instead to the reality of a K-Shaped recovery, in which some industries and some Americans will bounce back vigorously while others remain in freefall. For companies and workers on the wrong side of the equation—many in the travel, entertainment, leisure, hospitality, and food service industries, for example—there is no end in sight for the economic downturn.
Though many have innovated and adapted to stay open and keep their employees on payrolls, companies can survive for only so long with enduringly diminished revenue. For many, as long as social distancing remains necessary and public health restrictions remain in effect, it will be next to impossible to get back on track and return to strength.
Data reveal the stark divide. The financial services sector, for example, has recovered 94% of its pre-pandemic employment. Leisure and entertainment companies, on the other hand, have only brought back 74% of their workers. Meanwhile, the restaurant industry is expected to lose $240 billion by the end of 2020 if Congress doesn’t take further action, while U.S. airlines could be forced to furlough 75,000 pilots, flight attendants, mechanics, and other workers.
Small businesses have been among the hardest hit. Currently, four in five small business owners rate the health of the economy as average or poor, according to the latest MetLife & U.S. Chamber of Commerce Small Business Index, while other surveys show that a very small number expect to be able to maintain current payrolls without additional government assistance from Congress.
These industries and companies and the families and communities that count on them need assistance, but right now, they’re not receiving it from Congress. We simply cannot allow millions of workers and broad swaths of our economy to be left behind in the recovery.
In a K-shaped recovery like the one unfolding now, there are dual risks. One on hand, broad-based economic stimulus—appropriate in a normal, more even downturn—could expend money where it is not needed. On the other hand, providing no support at all threatens to push entire sectors, employers, and employees over the edge of the cliff, which could drive a larger recession. That’s why targeted, temporary support is so fundamentally imperative at this moment in the crisis.
Congress may or may not step up and fulfill their role in this moment. Regardless, American voters should hear from each presidential candidate how his administration would chart the road to recovery ahead. Both candidates should be able to articulate how they would provide targeted support to those industries and businesses who need it most—and who will continue to need it for the foreseeable future.
Nearly one in six restaurants in the U.S. have closed since the pandemic began, according to a recent survey. And the coming winter will bring many more closures, as cold weather makes outdoor dining difficult. What can restaurants do to survive?
Stay warm: Sales of propane heaters and patio fire pits are soaring, as restaurants take steps to keep open their outdoor areas. Streamlining permit processes for outdoor dining areas could also be beneficial.
Clean the air: To reduce the risk of virus transmission through the air, some restaurants are upgrading their air-filtration systems or installing movable partitions between tables to trap virus particles.
Diversify: Some restaurants have tried to find other ways to make money. Among the ideas: selling family-size takeout meals; converting part of a restaurant into a gourmet grocer; and creating a “ghost kitchen,” a restaurant within the restaurant that serves a new menu of takeout food.
Hotel job losses will double without more federal help, operators warn. Michael Jacobson, president of the Illinois Hotel & Lodging Association, is pleading for help from Congress and urging Illinois and Chicago to relax a 50-person ceiling on gatherings as a way to boost hotel room stays.
While hotel occupancy in other major cities has recovered to roughly 50%, Chicago is stuck at 20% due to those “overly burdensome restrictions,” Jacobson said.
“More than half of our total revenue for many of our hotels is reliant on meetings and events — what we call group travel. So until those restrictions get eased, we’re gonna be in a world of pain. … There isn’t going to be a significant recovery,” Jacobson said. “Leisure travel can only help us so much. People doing staycations [and] the regional people driving to some of our markets can only go so far.”
During a conference call with his counterparts across the nation, Jacobson noted downtown hotels are “on the hook for incredibly high property taxes payments.” That was a problem before COVID-19 brought convention and tourism to a virtual standstill. It’s an even bigger problem now. “Some of our downtown Chicago hotels pay over $30,000-a-day in property taxes. They have to sell over 200 rooms to break even each day, just on property taxes. Without further help, the consequences will not only be dire. Many of the losses will be permanent,” Jacobson said.
“Job losses, as of September, are already at 67,000. Potential job losses without congressional aid are going to nearly double. … Half of our hotels are at risk of foreclosure. That was evident here in Illinois recently, with the foreclosure proceedings that began with the Palmer House, one of our largest and most historic hotels in Illinois. Other of our hotels have tried to re-open, but have already shut down again for the winter because of the restrictions that are in place and the lack of demand.”
United, American Move Ahead with 32,000 Layoffs
Chicago-based United Airlines says it’s moving ahead with plans to furlough 13,000 workers but is still holding out hope for more federal aid. Under the CARES Act, the federal government provided billions in grants to U.S. airlines, which agreed not to lay off employees through Sept. 30.
United initially warned that it might furlough 36,000 workers, or more than one-third of its staff. Through early retirements, job-sharing, and other moves, however, the number of layoffs was reduced to about 16,000. About 2,800 pilots won’t be furloughed until at least June as a result of a deal cut earlier this week, in which pilots agreed to pay cuts in order to avoid furloughs in their ranks.
Meanwhile, American Airlines today indicated it will start laying off 19,000 workers on Thursday as originally scheduled, spurning an appeal from U.S. Treasury Secretary Steven Mnuchin as he negotiates with Congress about extending payroll support for U.S. carriers.
The American and United layoffs would add to job losses that already total 150,000 at the nation’s four largest carriers based on employees who have left voluntarily or taken temporary leave.
The Illinois Department of Public Health on Wednesday urged trick-or-treaters to socially distance on Halloween, while cautioning the holiday is best celebrated sans the usual celebrations.
In a news release pointing out that “the safest way to celebrate is to stay home,” IDPH said trick-or-treaters this year should only travel with other members of their household. Both trick-or-treaters and those passing out candy must wear masks and maintain a 6-foot distance at all times. That means the latter group should consider leaving the candy outside.
As for costumes, people will need to add proper face coverings to their getups. A Halloween mask usually doesn’t fit that bill, according to the release. If it’s impossible to breathe with both a cloth and costume mask on, trick-or-treaters must discard the latter one. And people should not eat the candy they collect without washing their hands, the release said.
One alternative that health officials suggested was setting up tables with spaced-out candy, so trick-or-treaters can do a lap while maintaining 6 feet of distance, perhaps with reserved time slots.
The release also issued a reminder that haunted houses are prohibited under Governor Pritzker’s phase four reopening plan, but one-way haunted forests or walks are doable as long as 6-foot distance is maintained. Adult or bar parties must follow the limit of 50 people or under 50% of the building’s maximum capacity, whichever is fewer. Hayrides also must not exceed the 50% capacity.
Finally, we’re happy to announce our next virtual conference: State of the County address with Will County Executive Denise Winfrey. Please join the Joliet Chamber for an update about Will County including:
- The wrap up of the largest capital campaign in the county’s history
- The County’s response to the COVID crisis – the quick alteration of delivery to ensure county services were maintained for our residents
- Balanced budget without a tax increase which will ensure a stable county government
Join us on Wednesday, October 7th at 11:00 a.m. Register here: http://jolietchamber.chambermaster.com/events/details/2020-webinar-october-7th-state-of-the-county-with-will-county-executive-denise-winfrey-5960
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry