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Job Cuts Pile Up, Ford to Make Ventilators At Parts Plant

Tuesday Mar 31, 2020
In this Thursday, March 26, 2020 photo, A.J. Davidson, who works in the business development department at Blue Delta Jeans, packages face guards made at the jeans manufacturing site in Shannon, Miss.
In this Thursday, March 26, 2020 photo, A.J. Davidson, who works in the business development department at Blue Delta Jeans, packages face guards made at the jeans manufacturing site in Shannon, Miss.   (Source:AP Photo/Julio Cortez)

The outbreak of the coronavirus has dealt a shock to the global economy with unprecedented speed. Following are developments on Monday related to the global economy, the work place and the spread of the virus.

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AIR CARE: Britain's health service is asking airline cabin crew who have been laid off to go to work in temporary new hospitals being built to treat COVID-19 patients. The National Health Service says easyJet and Virgin Atlantic are writing to thousands of staff — especially those with first aid training — asking them to work at hospitals being built inside convention centers in London, Birmingham and Manchester. Those who sign up will perform support roles under the supervision of doctors and nurses.

Employees at 16 U.S. air traffic control facilities have now tested positive for coronavirus, including personnel at a center in Houston on Monday, according to the Federal Aviation Administration. The FAA said the Houston facility continued running while being cleaned. The control tower at a small airport on Long Island, New York, remained closed nine days after an undisclosed number of personnel there tested positive for the virus.

American Airlines said it plans to seek $12 billion in government aid to cover payroll costs for the next six months while sweetening offers for voluntary leave and early retirement to reduce the work force.

The airline is now offering to pay a portion of salary for workers who accept voluntary leave or early retirement. American will seek part of a $50 billion kitty that Congress and the White House created for passenger airlines under a $2 trillion measure to help the economy withstand a sharp downturn caused by the new virus pandemic.

Air Canada will temporarily lay off more than 15,000 unionized workers beginning this week as the airline struggles with fallout from the coronavirus pandemic.

JOBS VANISH, PAY IS CUT: Macy's will stop paying tens of thousands of employees who were thrown out of work when the chain closed its stores in response to collapsing sales during the pandemic. The majority of its 130,000 employees, including stock people and sales clerks, will still collect health benefits, but the company said that it is transitioning to an "absolute minimum workforce" needed to maintain basic operations.

Rent the Runway confirmed that it laid off its entire retail staff and is not sure whether stores will reopen. The layoffs were announced via video conference on Friday, the company said. Workers will be getting severance and two months of health insurance. It's unknown how many employees will be affected. The company's online subscription service continues. The job cuts were first reported by online news website Verge.

Gannett, the country's largest newspaper publisher, is cutting pay and hours of newsroom employees by 25% in April, May and June because of advertising declines. Executives are getting a pay cut of 25%.

RESTAURANT RESERVATIONS: U.S. restaurant sales dropped 36% in the week ending March 22, according to consulting firm The NPD Group, with about 94% of restaurants operating under some restrictions that week.

Dine-in restaurants like Olive Garden and Applebee's reported sales declines of 71% compared to the same period last year. Fast food sales fell 34%.

To draw more customers, Restaurant Brands International — the parent company of Burger King, Popeyes and Tim Hortons — said it's expanding delivery in the U.S. and Canada and adding curbside pickup to its mobile app for truckers or walk-up customers who can't use the drive-thru windows. The Toronto-based company also said it's mailing 15,000 thermometers to its restaurants so employees can be checked before they begin their shifts.

Meanwhile, OpenTable — an app that normally lets diners make reservations at 60,000 restaurants worldwide — is getting into the grocery business. Starting this week, OpenTable will let people reserve a time to shop at several California groceries, including Belcampo Meat Co. OpenTable says it's making the technology available for free to groceries and other retailers.

FORD VENTILATORS: Ford is repurposing an auto parts factory west of Detroit to start building simple ventilators to treat coronavirus patients.

The automaker says that starting the week of April 20, it expects to produce 50,000 ventilators in 100 days. The plant in Ypsilanti Township, Michigan, would have the ability to build 30,000 per month after that.

Ford also is working with GE Healthcare to quickly double production of a more sophisticated ventilator at a factory in Madison, Wisconsin.

The ventilators to be built in Michigan are a designed by Airon Corp. Ford says they work on air pressure, not electricity, and can handle the needs of most COVID-19 patients.

GUESTS ARE GONE: Hotels are bracing for a colossal drop in revenue this year. STR and Tourism Economics — two data firms — forecast revenue declines of 51% per available hotel room.

Revenue per available room is a key industry statistic; it grew for 10 years straight before reaching a record of $86.76 in 2019.

The American Hotel and Lodging Association estimates that by Tuesday half of all U.S. hotels will have closed, affecting 1.6 million jobs.

Marriott International — the world's biggest hotel chain — has furloughed about two-thirds of its 4,000 corporate employees. Hilton plans furloughs or reduced hours for much of its corporate staff starting next week.

Airbnb, which has also seen a sharp drop-off in business, pledged Monday to offer more financial help to the hosts of its 7 million listings. Airbnb will pay hosts 25% of what they would have earned if a guest cancels a reservation between March 14 and May 31. It estimated the program will cost $250 million. Hosts were angered earlier this month when Airbnb announced guests could cancel their stays without any penalty. Airbnb also said it is creating a $10 million fund for some of its best hosts and experience providers to help them pay rent or mortgages.

THE VIRUS : Johnson & Johnson expects to begin human clinical studies of its "lead vaccine candidate" no later than September. The company said the first batches of a COVID-19 vaccine could be available for emergency use in early 2021.

Shares of Abbott Laboratories jumped more than 6% Monday in the first day of trading since announcing that the Food and Drug Administration had approved its test for the detection of the novel coronavirus. Abbott's portable ID NOW platform can produce positive test results in as little as five minutes, and negative results in 13 minutes. The tests are expected to be available next week and the company says it will ramp up manufacturing to deliver 50,000 per day.

MARKETS: Stocks pushed higher on Wall Street, led by big gains for health care companies announcing developments that could aid in the coronavirus outbreak. Monday's rally tacked more gains onto a recent upswing for the market, which is coming off the best week for the S&P 500 since hitting bottom after the financial crisis. It was a different story in energy markets, where a barrel of U.S. crude plunged below $20 per barrel.

EXTRA: Facebook is investing an additional $100 million in local journalism to support reporting on the pandemic. Emergency grant funding of $25 million will go to local news through the Facebook Journalism Project and another $75 million will be devoted to media marketing. Facebook, which has a rocky relationship with the media industry, has already committed $300 million to journalism organizations.

One of Florida's largest newspapers, meanwhile, announced Monday that it would temporarily change it's print frequency to two days a week. The Tampa Bay Times, which is based in St. Petersburg, said it will deliver newspapers to homes on Wednesdays and Sundays, the paper's largest circulation days.

Copyright Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


COVID-19 And You

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