Business Update - Weekly Digest (August 25, 2021)
The FDA has now granted Pfizer and BioNTech full approval of their COVID-19 vaccine for persons aged 16 and up. This means this vaccine has met the agency’s standards for safety, effectiveness, and manufacturing quality. The approval was based on close examination of six-months of follow-up which revealed no additional long-term safety concerns. Hopefully, the approval may now spur major companies to require employees to be vaccinated. Based on clinical studies, this vaccine is 91% effective in preventing serious illness.
THE AMERICAN RECOVERY PLAN ACT (ARPA)
Monthly Child Tax Credit Payments
An unspecified glitch at the IRS resulted in some people receiving their advance Child Tax Credit Payment by paper check in August, even though they received their July payment by direct deposit in July. The IRS plans to have that issue resolved in time for the September payment, scheduled to go out September 15. If you haven’t received your August payment, check the IRS portal for the advance Child Tax Credit. No action is needed if you already signed up for direct deposit to receive your September payment as a direct deposit.
Federal Unemployment
The government is ending Federally funded unemployment as of September 6, 2021. There is still a challenge for some to find a job based on required skills and types of jobs available. While some states ended unemployment months ago, some like California are still receiving Federal funds. Many argue that while there are a lot more jobs out there, not everyone is comfortable, or medically capable to go out and get regular jobs. There is an entire segment of the workforce that now has COVID longhaulers as well as more parents having to make arrangements if they are afraid to send their children back to school.
TAXES
A new report from the Urban-Brookings Tax Policy Center shows that 61% of all taxpayers, more than 100 million households, paid no federal income taxes during 2020. This is an increase from the steady 44% of taxpayers who paid no federal income taxes for the last decade through 2019. The increase was fueled by pandemic-related unemployment, stimulus checks and generous tax credits. Most of these will expire after 2022, which will result in a decrease in non-taxpayers starting next year. Only an estimated 20% of households paid neither income tax nor payroll taxes. The Tax Policy Center estimates that nearly everyone paid some other form of taxes, including state income taxes, state and local sales taxes, property taxes, and excise taxes.
EMPLOYEE RETENTION
If you’re having a hard time hanging on to your best employees, you’re not alone: a recent survey by PwC found that 65% of employees are looking for a new job, up from 35% in May. Workers say the top reasons for leaving are higher pay, better benefits, and more workplace flexibility, including options for full-time remote work or a hybrid schedule. The current labor market may be an opportunity for some workers to close pay gaps, which has resulted in women, Hispanic, Black, and other groups being paid less than male or white, non-Hispanic workers. Employers should consider these factors if they want to retain and recruit the best people.
Besides offering higher pay, offering childcare to employees can solve one of the primary reasons workers are not returning to work. According to a recent survey, the main reason many parents are not returning to work is childcare obligations.
REOPENING THE OFFICE AND REMOTE WORK OPTIONS
With the latest wave of COVID-19 re-opening delays, some companies may be closed for a full two years. As people stay home longer, executives fear that it may be even more difficult to bring them back when—and if—offices eventually re-open. Some, including the CEO of Intel, predict that hybrid and remote work will be the norm for years to come, and that there is no going back to the way things were.
Some Generation Z workers who started work during the pandemic have never worked in an office. While some younger employees are disappointed at missing the experience of working in an office where spontaneous collaboration and coaching are normal, others don’t feel they are missing out on as much. Many new college graduates spent months in virtual classrooms, which prepared them for a remote work experience.
ECONOMY
The rise of the delta variant of COVID-19 is apparently causing consumers to cut back on purchases: retail sales in July decreased by 1.1% after increasing in June by 0.7%. However, even this month-over-month decline is still 15.8% higher than a year ago. Eating and drinking establishments are 38.4% above where they were a year ago. This slowdown is persisting into August, as factory activity and service providers are reporting sharply slower growth in the U.S.
Meanwhile, new jobless claims fell last week to the lowest level since before the pandemic. However, with more than 10.1 million job openings, many employers report having a difficult time filling jobs.
Happy Animal News
We’re holding our breath and keeping our fingers crossed that Pen Farthing, his staff and their families, as well as his NOWZAD charity dogs and cats, make it out of Afghanistan safely this week. If you haven’t heard this news story in the United States, it is because it involves a former British Royal Marine who heads a dog charity in Afghanistan. He’s managed to crowdfund an Airbus A330 at no cost to any taxpayers to get his charity workers and animals out of Afghanistan. The British Ministry of Defense had been hindering the operation but as of this morning, they have given the all-clear. Apparently, any empty seats will go to at-risk Afghans leaving the country. Here’s the most up-to-date story.
In less stressful happy news, here’s the story about Bubba the dog who found help for his dog-brother when he got stuck in a swamp in Connecticut.
