• Market Crumbs

Workers Begin Striking

Image via Markus Spiske on Unsplash

While many Americans are confined to their homes amidst the coronavirus outbreak, employees in various vital industries continue to go to work, risking exposure to the deadly virus.

As a result of the lockdown, Americans have increasingly relied on delivery companies to bring necessities directly to their homes. Two companies in particular—Amazon and Instacart, are starting to face backlash from their very own employees.

Employees at Amazon's Staten Island warehouse walked off the job yesterday in protest of the company's handling of the coronavirus outbreak. Employees at the warehouse want the facility to be closed for cleaning and to be paid while it's closed after an employee at the warehouse tested positive for the coronavirus last week.

"Since the building won’t close by itself, we’re going to have to force [Amazon’s] hand," said Chris Smalls, lead organizer of the strike. "We will not return until the building gets sanitized."

Amazon believes the warehouse does not need to be closed, saying "We are following all guidelines from local health officials and are taking extreme measures to ensure the safety of employees at our site."

An Amazon spokesperson even fired back at Smalls, saying "We have heard a number of incorrect comments from Christian Smalls, the hourly associate claiming to be the spokesperson on this topic."

Employees of delivery service Instacart went on strike over three demands. Instacart workers are seeking free safety products such as hand sanitizer and wipes, hazard pay of $5 per order with the tip prompt defaulting to 10% and expanded sick pay to those with pre-existing conditions who are more at risk to the coronavirus.

Instacart has given in to the demands by saying it will produce and distribute sanitizer to workers, offer bonuses based on the number of hours worked and extend sick pay for those diagnosed with the coronavirus or directed to stay at home.

Gig Workers Collective, the organizers of the strike, aren't impressed with Instacart's response, calling it "insulting" and "a sick joke." "It’s abhorrent that it took this long for them to act, but on the bright side, it shows that a strike will work to change their behavior," the group wrote.

People's dependence on delivery services will likely only increase the longer they're forced to stay inside their homes. With trouble brewing among their employees, it will be interesting to see how they approach employee demands given their plans to hire tens of thousands of employees.

Leftover Crumbs

  • Last strong month for a while? U.S. pending home sales rose 2.4% in February from the prior month, marking a 9.4% increase from a year earlier, according to the National Association of Realtors. As pending home sales are based on signed contracts, some of the pending sales in February's report may fall apart due to the coronavirus' effect on the economy. As a result of the coronavirus, the housing market is expected to see a slowdown, which could show up in March's numbers.

  • A potential vaccine. Johnson & Johnson says it could begin human testing of its experimental coronavirus vaccine by September and it could be available for emergency use by early 2021. J&J said it hopes to produce more than 1 billion doses of the vaccine if successful. "The world is facing an urgent public health crisis and we are committed to doing our part to make a COVID-19 vaccine available and affordable globally as quickly as possible," J&J CEO Alex Gorsky said.

  • A bad year for dividends? As the coronavirus has sent companies scrambling to shore up up their balance sheet, Goldman Sachs sees S&P 500 dividends dropping by 25% this year. "The record high level of net leverage for the median S&P 500 stock coupled with the ongoing credit market stress means many firms are unlikely to borrow to fund their dividend," Goldman said.

  • 130,000. Macy's will furlough most of its 130,000 employees as the retailer's sales collapse as a result of the coronavirus outbreak. Macy's has already suspended its dividend, drawn on its line of credit, frozen spending and hiring and canceled some orders. "While these actions have helped, it is not enough," Macy's said. "Across Macy’s, Bloomingdale’s, and Bluemercury brands, we will be moving to the absolute minimum workforce needed to maintain basic operations."

  • Bailout for PJs. Private-jet companies could receive billions in loans, aid and tax breaks as a result of the $2 trillion coronavirus stimulus package. Companies wouldn't have to pay the Federal Excise Tax, which is a 7.5% tax on private-jet customers. Private-jet companies are also eligible for funds from the $25 billion in loans and loan guarantees available to the aviation industry, as well as $25 billion in grants for employee wages.