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Macy’s to Furlough Most of Its 130,000 Workers: Live Business Updates Macy’s to Furlough Most of Its 130,000 Workers: Live Business Updates
(32 minutes later)
Macy’s, which also owns Bloomingdale’s and Bluemercury, said on Monday that it had lost “the majority” of its sales because of store closures, which started March 18 and would persist until the retailer had a “clear line of sight on when it is safe to reopen.”Macy’s, which also owns Bloomingdale’s and Bluemercury, said on Monday that it had lost “the majority” of its sales because of store closures, which started March 18 and would persist until the retailer had a “clear line of sight on when it is safe to reopen.”
The company said that as a result, it will furlough the majority of its employees this week and maintain the “absolute minimum work force needed to maintain basic operations,” according to a statement. There will be fewer furloughs among employees supporting the digital business at call centers and distribution centers. Macy’s had 130,000 part-time and full-time employees as of Feb. 2.The company said that as a result, it will furlough the majority of its employees this week and maintain the “absolute minimum work force needed to maintain basic operations,” according to a statement. There will be fewer furloughs among employees supporting the digital business at call centers and distribution centers. Macy’s had 130,000 part-time and full-time employees as of Feb. 2.
The move shows the strain that the pandemic is placing on retailers selling goods that are considered nonessential. Many department stores and mall chains had already been weakened in recent years by the rise of e-commerce and a drop in foot traffic at malls. A complete closure of stores and a shift in consumer spending is dealing a new blow to such companies and their many employees.The move shows the strain that the pandemic is placing on retailers selling goods that are considered nonessential. Many department stores and mall chains had already been weakened in recent years by the rise of e-commerce and a drop in foot traffic at malls. A complete closure of stores and a shift in consumer spending is dealing a new blow to such companies and their many employees.
Macy’s also said that it had already stopped capital spending and paying a dividend. It has also drawn down its line of credit and canceled some orders.Macy’s also said that it had already stopped capital spending and paying a dividend. It has also drawn down its line of credit and canceled some orders.
“While these actions have helped, it is not enough,” the company said. “At least through May, furloughed colleagues who are enrolled in health benefits will continue to receive coverage with the company covering 100% of the premium. We expect to bring colleagues back on a staggered basis as business resumes.”“While these actions have helped, it is not enough,” the company said. “At least through May, furloughed colleagues who are enrolled in health benefits will continue to receive coverage with the company covering 100% of the premium. We expect to bring colleagues back on a staggered basis as business resumes.”
Oil prices hit their lowest levels since 2002 on Monday, as the gloom over energy markets deepened after President Trump extended guidelines on social distancing and nonessential travel in the United States, an admission that there is no certainty around when the spreading coronavirus epidemic will end.Oil prices hit their lowest levels since 2002 on Monday, as the gloom over energy markets deepened after President Trump extended guidelines on social distancing and nonessential travel in the United States, an admission that there is no certainty around when the spreading coronavirus epidemic will end.
The drop was the strongest signal from financial markets that investors remained uneasy about the fate of the economy.The drop was the strongest signal from financial markets that investors remained uneasy about the fate of the economy.
Stocks in the United States rose, led by a surge in health care shares buoyed by developments in the coronavirus outbreak. Johnson & Johnson shot up by more than 8 percent, after the company said it had identified a lead candidate for a vaccine for the virus and planned to ramp up both production and clinical testing.Stocks in the United States rose, led by a surge in health care shares buoyed by developments in the coronavirus outbreak. Johnson & Johnson shot up by more than 8 percent, after the company said it had identified a lead candidate for a vaccine for the virus and planned to ramp up both production and clinical testing.
Abbott Laboratories, the maker of drugs, medical and diagnostic equipment, rose by more than 7 percent on news that it said a new test that could detect the virus in five minutes had been cleared for use by the Food and Drug Administration.Abbott Laboratories, the maker of drugs, medical and diagnostic equipment, rose by more than 7 percent on news that it said a new test that could detect the virus in five minutes had been cleared for use by the Food and Drug Administration.
But other industries continued to be battered by the long shadow of the virus. Cruise lines Royal Caribbean, Norwegian and Carnival were all down 10 percent, making them some of the worst performers in the S&P 500 on Monday.But other industries continued to be battered by the long shadow of the virus. Cruise lines Royal Caribbean, Norwegian and Carnival were all down 10 percent, making them some of the worst performers in the S&P 500 on Monday.
The index has risen in four of the last five trading sessions, and is up nearly 17 percent over that period. But even after that rapid rise, the market remains down more than 20 percent from the record high level it struck a little over a month ago.The index has risen in four of the last five trading sessions, and is up nearly 17 percent over that period. But even after that rapid rise, the market remains down more than 20 percent from the record high level it struck a little over a month ago.
The dizzying moves that characterized trading in financial markets for most of March seem to have ended as policymakers around the world moved to bolster their economies with spending and other means of support. But investors were weighing those efforts — including a $2 trillion spending plan in the United States — against the rising number of coronavirus cases.The dizzying moves that characterized trading in financial markets for most of March seem to have ended as policymakers around the world moved to bolster their economies with spending and other means of support. But investors were weighing those efforts — including a $2 trillion spending plan in the United States — against the rising number of coronavirus cases.
In the oil market, brent crude, the international benchmark, fell more than 6 percent to roughly $26 a barrel on Monday. West Texas Intermediate, the U.S. benchmark, was down more than 5 percent with prices hovering around $20.25 in early afternoon trading. Earlier this morning the price had briefly dropped below $20 a barrel, a level not seen in almost 20 years.In the oil market, brent crude, the international benchmark, fell more than 6 percent to roughly $26 a barrel on Monday. West Texas Intermediate, the U.S. benchmark, was down more than 5 percent with prices hovering around $20.25 in early afternoon trading. Earlier this morning the price had briefly dropped below $20 a barrel, a level not seen in almost 20 years.
Oil has also been hammered by a price war between Saudi Arabia and Russia, two of the largest oil producers, but analysts say that it is far outweighed by the collapse in demand caused by the pandemic.Oil has also been hammered by a price war between Saudi Arabia and Russia, two of the largest oil producers, but analysts say that it is far outweighed by the collapse in demand caused by the pandemic.
FGE, a consulting firm, recently estimated that demand for April would fall by 17 million barrels a day — about 17 percent lower than usual — as airplanes are grounded, road traffic falls sharply and factories are shuttered.FGE, a consulting firm, recently estimated that demand for April would fall by 17 million barrels a day — about 17 percent lower than usual — as airplanes are grounded, road traffic falls sharply and factories are shuttered.
Gannett, the largest newspaper publisher in the United States, said on Monday that it would impose pay cuts and furloughs on its staff, making it the latest news company to acknowledge that reader interest prompted by the coronavirus pandemic has not made up for a sharp downturn in advertising revenue.
Employees learned of the austerity plan through a memo sent by Paul Bascobert, the chief executive of Gannett’s operating company.
In the memo, which was obtained by The New York Times, Mr. Bascobert said that advertising had fallen off, despite an increase in web traffic and subscriptions. “Overall, though,” he added, “we expect our revenue to decline considerably during this period.”
He said that company executives had agreed to 25-percent pay cuts and he would not take his salary until the measures were reversed.
In a fact sheet shared with the staff, Gannett said the moves would affect “the majority” of company employees, and that some would be furloughed one week each month in April, May and June.
After a $1.2 billion merger completed last November, Gannett publishes roughly 260 dailies, including USA Today, The Detroit Free Press, The Arizona Republic and The Milwaukee Journal Sentinel. A Gannett spokeswoman declined to comment.
Top Democrats are urging the Treasury Department and Federal Reserve to use nearly $500 billion from the $2 trillion economic rescue package that became law last week to bail out strapped states and cities, instead of granting loans to large corporations.Top Democrats are urging the Treasury Department and Federal Reserve to use nearly $500 billion from the $2 trillion economic rescue package that became law last week to bail out strapped states and cities, instead of granting loans to large corporations.
The law appropriates $454 billion from Treasury to backstop loans from the Fed to eligible businesses, municipalities or states. Officials have so far focused their emergency lending programs on businesses. Senator Elizabeth Warren of Massachusetts wrote to Treasury on Friday, calling the needs of local and state governments “a matter of life and death.”The law appropriates $454 billion from Treasury to backstop loans from the Fed to eligible businesses, municipalities or states. Officials have so far focused their emergency lending programs on businesses. Senator Elizabeth Warren of Massachusetts wrote to Treasury on Friday, calling the needs of local and state governments “a matter of life and death.”
The Fed has come under increasing pressure to help state and municipal finance, potentially by investing directly in local debt, though it has thus far declined to. Some of its programs help local bond markets, but do so indirectly.The Fed has come under increasing pressure to help state and municipal finance, potentially by investing directly in local debt, though it has thus far declined to. Some of its programs help local bond markets, but do so indirectly.
Investors widely expect the central bank to unveil some sort of program to provide additional support to states and localities. The central bank has recently hired Kent Hiteshew, a former Treasury official who is an expert in municipal debt, a spokesman confirmed.Investors widely expect the central bank to unveil some sort of program to provide additional support to states and localities. The central bank has recently hired Kent Hiteshew, a former Treasury official who is an expert in municipal debt, a spokesman confirmed.
President Trump on Friday accused General Motors and its chief executive, Mary T. Barra, of dragging their feet on a project to build ventilators and directed his administration to force the company to make ventilators under a 1950s law. But accounts from five people with knowledge of the automaker’s plans depict an attempt by G.M. and its partner, Ventec Life Systems, to accelerate production of the devices.President Trump on Friday accused General Motors and its chief executive, Mary T. Barra, of dragging their feet on a project to build ventilators and directed his administration to force the company to make ventilators under a 1950s law. But accounts from five people with knowledge of the automaker’s plans depict an attempt by G.M. and its partner, Ventec Life Systems, to accelerate production of the devices.
On March 19, G.M. began collaborating with Ventec, which normally makes about 200 machines a month, to figure out how to make about 10 times as many in that time. Working through the weekend of March 21 and 22, they hurried to find new suppliers that could provide parts in high volumes, said the five people, who asked not to be named because they feared it would further antagonize Mr. Trump.On March 19, G.M. began collaborating with Ventec, which normally makes about 200 machines a month, to figure out how to make about 10 times as many in that time. Working through the weekend of March 21 and 22, they hurried to find new suppliers that could provide parts in high volumes, said the five people, who asked not to be named because they feared it would further antagonize Mr. Trump.
When Mr. Trump lashed out at G.M. on Friday, executives at both companies were stunned. G.M. executives were furious Mr. Trump would attack the company after it had made so much progress in a week and the administration had earlier been supportive of their effort.When Mr. Trump lashed out at G.M. on Friday, executives at both companies were stunned. G.M. executives were furious Mr. Trump would attack the company after it had made so much progress in a week and the administration had earlier been supportive of their effort.
“What we’ve accomplished in five days is incredible,” Larryson Foltran, who works in a technology support group at G.M., wrote on Facebook, noting he had been working 14 to 18 hours a day. He said that the president’s posts had bothered him “on a deeper level.”
Insurance premiums could surge as much as 40 percent as the country confronts tens of billions of dollars in extra costs treating patients with the virus.Insurance premiums could surge as much as 40 percent as the country confronts tens of billions of dollars in extra costs treating patients with the virus.
If the pandemic puts millions of Americans in hospitals, private health insurance costs will jump next year, according to a new analysis. Insurers, employers and individuals could face as much as $251 billion in additional expenses from testing and treatment of the virus.If the pandemic puts millions of Americans in hospitals, private health insurance costs will jump next year, according to a new analysis. Insurers, employers and individuals could face as much as $251 billion in additional expenses from testing and treatment of the virus.
But there are still a lot of unknowns. How many people will be affected? How many will need hospitalization? These factors could alter the costs significantly.But there are still a lot of unknowns. How many people will be affected? How many will need hospitalization? These factors could alter the costs significantly.
Insurance companies, in anticipation of the astronomical increase in costs, have asked Congress for help by setting up a special reinsurance program that would cover the most expensive claims and lower premiums to employers and insurance companies.Insurance companies, in anticipation of the astronomical increase in costs, have asked Congress for help by setting up a special reinsurance program that would cover the most expensive claims and lower premiums to employers and insurance companies.
Carnival, the hard-hit cruise company, has already tapped a $3 billion credit line and said in regulatory filings that it was looking for new financing. The cruise company is working with Wall Street banks to line up investors for a high-interest debt offering, said one person briefed on the matter but not authorized to speak publicly.Carnival, the hard-hit cruise company, has already tapped a $3 billion credit line and said in regulatory filings that it was looking for new financing. The cruise company is working with Wall Street banks to line up investors for a high-interest debt offering, said one person briefed on the matter but not authorized to speak publicly.
It’s one of just many corporations across a wide swath of industries and in vastly different financial straits that are being forced to stretch their cash, cut costs, avoid loan defaults and prepare to potentially reorganize their businesses.It’s one of just many corporations across a wide swath of industries and in vastly different financial straits that are being forced to stretch their cash, cut costs, avoid loan defaults and prepare to potentially reorganize their businesses.
For one group in the financial services industry — restructuring and bankruptcy advisers and lawyers — the emerging signs of pain for companies, both big and small, spell booming business.For one group in the financial services industry — restructuring and bankruptcy advisers and lawyers — the emerging signs of pain for companies, both big and small, spell booming business.
Companies that depend heavily on consumer spending are especially troubled. Restructuring advisers expect retailers — whose financial position was already stretched because of the rise of e-commerce — to run into further trouble as people cut back on shopping. Hoteliers, cruise lines, restaurants, event sponsors and mortgage lenders are among those suddenly short on cash, with travel and outdoor activity at a standstill and unemployment soaring. Workers at Instacart, a tech business that delivers groceries and other goods ordered through its app, began a nationwide strike Monday over what they said was a lack of adequate virus protection.
Workers at Instacart, a tech business that delivers groceries and other goods ordered through its app, plan a nationwide strike Monday, arguing that they lack adequate virus protection. “The strike is definitely on. It’s a work stoppage,” said Jordan Anderson, 44, a worker for Instacart in Portland, Ore. and one of the organizers of the strike. “Our intention when we announced the strike was that we are on strike until our demands are met and not just the half measures they keep flinging at us,” she said on Monday.
The service, long popular in Silicon Valley, has exploded across the country as people are told to stay home to prevent further spread of the disease. It wasn’t clear how many workers were taking part in the walk out but as many as 200,000 workers, known as shoppers, could walk off the job unless their demands for protective equipment and hazard pay of an extra $5 per order were met.
The company’s 200,000 delivery workers are independent contractors, and the app is not tied to any specific retailer. Instacart has agreements with more than 350 businesses, including Costco, CVS Pharmacy and Target. In a statement Monday, a spokeswoman for Instacart said its goal was “to offer a safe and flexible earnings opportunity to shoppers, while also proactively taking the appropriate precautionary measures to operate safely.”
But delivery workers say Instacart is “profiting astronomically off of us literally risking our lives, all while refusing to provide us with effective protection, meaningful pay and meaningful benefits.”
They’re demanding personal protection equipment, hazard pay of an extra $5 per order and at least 10 percent tip on each order total.
See’s Candies, the California chocolatier, said in a statement on its website that it was halting production, just the second interruption in its 99-year history (the first time was during World War II). “In recognition of the guidance provided by local health authorities, See’s has suspended production and shipping of product,” the company said.See’s Candies, the California chocolatier, said in a statement on its website that it was halting production, just the second interruption in its 99-year history (the first time was during World War II). “In recognition of the guidance provided by local health authorities, See’s has suspended production and shipping of product,” the company said.
Facebook announced Monday that it would give out $25 million in grants to local news organizations and spend $75 million in marketing that will go to news outlets internationally. Campbell Brown, a Facebook vice president, acknowledged in an interview that the company, whose huge chunk of online ad revenue helped dent media companies’ business models in the first place, felt a “responsibility” to help out.Facebook announced Monday that it would give out $25 million in grants to local news organizations and spend $75 million in marketing that will go to news outlets internationally. Campbell Brown, a Facebook vice president, acknowledged in an interview that the company, whose huge chunk of online ad revenue helped dent media companies’ business models in the first place, felt a “responsibility” to help out.
Disney joined other conglomerates in slashing salaries for executives by up to 30 percent. Bob Chapek, Disney’s new chief executive, said in a companywide email that he would take a 50 percent reduction and that Robert A. Iger, the executive chairman, would forgo his salary altogether, which totals $3 million annually according to securities filings.Disney joined other conglomerates in slashing salaries for executives by up to 30 percent. Bob Chapek, Disney’s new chief executive, said in a companywide email that he would take a 50 percent reduction and that Robert A. Iger, the executive chairman, would forgo his salary altogether, which totals $3 million annually according to securities filings.
American Media Inc., the publisher of The National Enquirer, Men’s Journal, Us Weekly and other titles, is cutting the pay of its employees more than 20 percent. It’s the latest instance of a media company trying to slim down. Last week, BuzzFeed announced temporary payroll cuts. Reporting was contributed by Matt Phillips, Stanley Reed, Kenneth P. Vogel, Jim Tankersley, Jeanna Smialek, Alexandra Stevenson, Matthew Goldstein, Sapna Maheshwari, Neal E. Boudette, Andrew Jacobs, Mary Williams Walsh, Johnny Diaz, Tiffany May, Reed Abelson, Derrick Bryson Taylor, Damien Cave, Edmund Lee, Marc Tracy, Brooks Barnes, Nicholas Kulish, Sarah Kliff, Jessica Silver-Greenberg, Daniel Victor and Carlos Tejada.
Reporting was contributed by Matt Phillips, Stanley Reed, Kenneth P. Vogel, Jim Tankersley, Jeanna Smialek, Alexandra Stevenson, Matthew Goldstein, Sapna Maheshwari, Neal E. Boudette, Andrew Jacobs, Mary Williams Walsh, Tiffany May, Reed Abelson, Derrick Bryson Taylor, Damien Cave, Edmund Lee, Marc Tracy, Brooks Barnes, Nicholas Kulish, Sarah Kliff, Jessica Silver-Greenberg, Daniel Victor and Carlos Tejada.