Corona Capital is a column updated throughout the day by Breakingviews columnists around the world with short, sharp pandemic-related insights.
– U.S. jobs
– Real estate
Unlocking, slowly. Americans are gradually getting back to work. The official employment report for September, released on Friday, showed a drop in the unemployment rate to 7.9% and the creation of 661,000 new jobs. There were positive signs, like some leisure and hospitality positions returning as pandemic lockdowns ease. The private sector, meanwhile, added more jobs than the headline suggests, because government employment declined.
But the improvements are slowing. There are still nearly 11 million fewer people on nonfarm payrolls than in February, and there’s a long way to go to recapture the 3.5% unemployment rate that prevailed before the pandemic.
The last monthly jobs report before the U.S. election on Nov. 3 was overshadowed by the news that President Donald Trump has tested positive for Covid-19. Assuming he is back campaigning soon, though, the flagging economic recovery, and how that relates to his handling of the coronavirus crisis, may matter more. (By Richard Beales)
Snowbirds forever. Homebuyers are flocking to Florida – at the expense of New York City. Apartment sales in Manhattan cratered 46% in the third quarter, according to CNBC, with a record 10,000 units on the market. Meanwhile, sellers have the upper hand in the Sunshine State. Signed contracts are up more than 60% in Palm Beach County and some 20% in Miami-Dade County.
It doesn’t help that formerly bustling mid-town Manhattan looks like the introductory scene in “Vanilla Sky,” where Tom Cruise drives and runs through an empty Times Square. Concerns about crime and dirty city streets are growing with over 150 chief executives, chairmen and company founders raising the alarm in a letter to Mayor Bill de Blasio. That could point to higher taxes in the city and more notches in Florida’s column. (By Jennifer Saba)
Final sprint. Britain’s state-backed coronavirus loan scheme for small firms is in wind-down mode. Finance minister Rishi Sunak recently extended the deadline for government-guaranteed “Bounce Back” loans, but only to Nov. 30. Demand, however, still looks high. HSBC has had to stop processing applications from new business customers because of a huge backlog, the Telegraph reported late on Thursday. The latest government statistics showed that almost 150,000 businesses applied for help between Aug. 16 and Sept. 20, with total loans so far surpassing 38 billion pounds.
The surge is unlikely to have ebbed since then, given renewed local lockdowns. The risk is that government assistance programmes end while help is still needed, forcing small firms out of business. Sunak and other officials are worried about how much money taxpayers will lose on the loans. With infections soaring again, a more pressing worry is whether they’re turning the taps off too early. (By Liam Proud)
Time, please. Coronavirus curfews are providing deeper insight into Britain’s unhealthy relationship with booze. Despite new 10 p.m. closing times shaving just one hour off available drinking time, pub sales are down 45% compared to a year ago, according to the Financial Times. It’s hard to ascribe all of that decline to a single hour of missed elbow-raising. Rather, Brits may be deciding that if you don’t go out properly, you don’t go out at all.
It’s yet another round of bad news for the hospitality sector. Shares in pub groups like J D Wetherspoon are already down 50% this year. And with the government’s furlough scheme winding up this month, staff are bearing the brunt. Fuller Smith & Turner, whose shares are down 40% since January, is axing one in 10 employees. At this rate, the recovery, when it finally comes, may see punters pulling their own pints. (By Ed Cropley)