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    Silicon Valley’s Best Pandemic Ever

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    As the world reeled, tech titans supplied the tools that made life and work possible. Now the companies are awash in money — and questions about what it means to win amid so much loss.SAN FRANCISCO — In April 2020, with 2,000 Americans dying every day of Covid-19, Jeff Bezos, Amazon’s chief executive and the world’s richest man, announced he was focusing on people rather than profits. Amazon would spend about $4 billion in the next few months “providing for customers and protecting employees,” he said, wiping out the profit the retailer would have made without the virus.It was a typically bold Amazon announcement, a shrewd public relations move to sacrifice financial gain at a moment of misery and fear. Mr. Bezos said this was “the hardest time we’ve ever faced” and suggested the new approach would extend indefinitely. “If you’re a shareowner in Amazon,” he advised, “you may want to take a seat.”At the end of July 2020, Amazon announced quarterly results. Rather than earning zero, as Mr. Bezos had predicted, it notched an operating profit of $5.8 billion — a record for the company.The months since have established new records. Amazon’s margins, which measure the profit on every dollar of sales, are the highest in the history of the company, which is based in Seattle.After stepping aside as chief executive early this month, Mr. Bezos flew to suborbital space for 10 minutes this week. Upon returning, he expressed gratitude to those who had fulfilled this lifelong dream. “I want to thank every Amazon employee and every Amazon customer, ’cause you guys paid for all this,” he said.Mr. Bezos, who was not available for comment for this article, was the only chief executive of a tech company to enter zero gravity in his own spaceship in the past year. But Amazon’s pandemic triumph was echoed all over the world of technology companies.Even as 609,000 Americans have died and the Delta variant surges, as corporate bankruptcies hit a peak for the decade, as restaurants, airlines, gyms, conferences, museums, department stores, hotels, movie theaters and amusement parks shut down and as millions of workers found themselves unemployed, the tech industry flourished.The combined stock market valuation of Apple, Alphabet, Nvidia, Tesla, Microsoft, Amazon and Facebook increased by about 70 percent to more than $10 trillion. That is roughly the size of the entire U.S. stock market in 2002. Apple alone has enough cash in its coffers to give $600 to every person in the United States. And in the next week, the big tech companies are expected to report earnings that will eclipse all previous windfalls.Silicon Valley, still the world headquarters for tech start-ups, has never seen so much loot. More Valley companies went public in 2020 than in 2019, and they raised twice as much money when they did. Forbes calculates there are now 365 billionaires whose fortunes derive from tech, up from 241 before the virus.Silicon Valley made the tools that allowed Americans, and the American economy, to survive the pandemic. People got their jigsaw puzzles, air purifiers and digital thermometers delivered by Amazon instead of picking them up two blocks or two miles away. The consumer economy swerved from local to national.Tech is triumphant in a way that even its most evangelical leaders couldn’t have predicted. No single industry has ever had such power over American life, dominating how we communicate, shop, learn about the world and seek distraction and joy.What will Silicon Valley do with this power? Who if anyone might restrain tech, and how much support will they have? Wealth and the ability to command and control tend to produce hubris more than modesty. As algorithms and artificial intelligence rearrange people into marketing groups, it’s uncertain — to put it politely — how aware the tech industry is of the potential for abuse, especially when it generates profits.With the House Judiciary Committee’s recent vote to advance a series of bills that aim to reduce the power of the most dominant tech companies, and with President Biden appointing regulators who have sharp views of Big Tech, these issues are finally set for a wider debate.It has been a tumultuous 18 months, and even the tech companies are having trouble absorbing what happened.PayPal, the digital payments company, had 325 million active accounts before the pandemic. It reported 392 million in the first quarter. “The winds were blowing in our direction, but we had to set the sails,” said Dan Schulman, the chief executive.The wind was so strong it blew tech into another universe of wealth and influence.The Pandemic’s TailwindIn March 2020, Redfin shut down its 78 offices around the country. Its stock lost two-thirds of its value. Shortly after, demand for real estate started rising again. Jordan Strauss/Associated PressOn March 13, 2020, Glenn Kelman, the chief executive of the online real estate broker Redfin, was biking to work when he got a call from Henry Ellenbogen, a longtime investor in Redfin who had started his own fund.At Harvard, Mr. Ellenbogen majored in the history of technology. One big thing he learned, he has said, was that technology is developed well in advance of people’s ability and willingness to use it.“Tell me something,” Mr. Ellenbogen asked Mr. Kelman, according to an account the chief executive posted on Redfin’s website. “When people start touring homes via an iPhone, won’t a lot of them decide, even after this whole pandemic ends, that this is just a better way to see houses? And if this whole process of buying and selling homes mostly goes virtual, how will other brokerages compete with you?”Mr. Kelman, a little preoccupied by how Seattle’s normally bustling streets were eerily empty, said he didn’t know.“I do,” Mr. Ellenbogen said. “The world is changing in your favor.”This was not a general view then, and it certainly was not what Mr. Kelman was experiencing. The first confirmed coronavirus death in the United States was a nursing home resident in a Seattle suburb on Feb. 29. Within hours, home sellers decided that maybe they did not want strangers breathing in their living room and bedrooms. Buyers began to pull out as well.For Redfin, that was the beginning of a crisis. Within a few days, it shut down its 78 offices around the country. Its stock plunged, losing two-thirds of its value.“The magnitude of the decline was increasing every day,” Mr. Kelman said. He agreed to sell Mr. Ellenbogen more stock for $110 million, thinking Redfin might need cash to make it through a long drought. In early April, Mr. Kelman furloughed 41 percent of the company’s agents, who were salaried employees. More than 1,000 people were affected.By that point, real estate was already turning around. Instead of killing demand for housing, the pandemic fueled it.“The economy split in two on about April 7, 2020,” Mr. Kelman said. “One part of the economy suffered greatly, but another did just fine — the people who said, ‘If the world is going to end in the virus-filled streets of New York, I’m going to Connecticut or Vermont or Maine and I need a house there.’ What we thought was a headwind was a tailwind.”The pandemic as a whole, it became clear, was a tailwind for tech in very basic ways.When tens of millions of people were urged and sometimes ordered to stay put in their homes, naturally companies whose very existence involves facilitating virtual lives benefited. The rise of the teleconferencing company Zoom as both a verb and stock market winner was perhaps the easiest call of the year.“Call it half luck — being in the right place at the right time — and half strategic tactics by companies recognizing this was going to be a once in a lifetime opportunity,” said Dan Ives, a managing director at Wedbush Securities. “What for most industries were hurricane-like headwinds was a pot of gold for tech.”Even companies that might have seemed vulnerable to stay-at-home mandates did well. Airbnb is a company whose whole existence was about going to stay in strangers’ homes. The pandemic should have killed the buzz for its long-awaited public offering in December. But its stock price doubled on the first day of trading, giving the company a value of $100 billion.Tech companies like Redfin that reacted defensively in March risked being left out of the recovery in April. The 2020 housing market, pushed by pandemic demand and negligible interest rates, turned out to be the best since 2006.Those furloughed at Redfin were soon hired back. Mr. Ellenbogen’s deal proved extremely lucrative. But an estimated 10 million people are behind on the rent even as eviction moratoriums start to expire.Mr. Kelman, more introspective than most tech executives, feels a little queasy.“Tech used to be delivering these wonders to the world, and all of us in the industry felt the human uplift of general progress,” he said. “With the pandemic, fortunes have really diverged and at least some people in tech are really uncomfortable about that.”Pushing Back“We went from being pirates to being the Navy,” said Marc Andreessen. “People may love pirates when they’re young and small and scrappy, but nobody likes a Navy that acts like a pirate.”Steve Jennings/Getty ImagesThe biggest, and perhaps the only, threat to tech now is from government.Tech antitrust reformers say the government response to the pandemic, including the national eviction moratorium, repudiated decades of entrenched belief in a hands-off economic approach. Now, the activists say, they will have their moment.“When the government moved in a robust way to keep everybody afloat, free-market ideologies died,” said Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a research and advocacy organization that fights corporate control. “People now appreciate that the government can either make choices that centralize power and wealth or it can structure markets and industries in way that deliver benefits more broadly.”There are signs of pushback against tech that would have been unimaginable a few years ago, beyond the House bills. Ohio sued Google, saying it should be regulated like a public utility. The Teamsters, one of the biggest labor unions, passed a resolution to supply “all resources necessary” to help organize workers at Amazon. Lina Khan, who made her reputation as a critic of Amazon, was appointed Federal Trade Commission chair. On Tuesday, the White House said it would nominate Jonathan Kanter, a tech critic, to be the Justice Department’s top antitrust official.But there are signs of movement in the other direction, too. The F.T.C. and a coalition of state attorneys general saw their antitrust lawsuits against Facebook dismissed by a Washington judge last month. The F.T.C. can refile an improved suit by the end of this month.Any measures restricting tech will ultimately need public sentiment behind them to succeed. Even some of tech’s biggest supporters see the potential for worry here.“We went from being pirates to being the Navy,” Marc Andreessen, a central figure in Silicon Valley for a quarter-century, told the Substack writer Noah Smith in a recent interview. “People may love pirates when they’re young and small and scrappy, but nobody likes a Navy that acts like a pirate. And today’s technology industry can come across a lot like a Navy that acts like a pirate.”Beyond the threat of misuse of tech lurks an even darker possibility: a misplaced confidence in the ability of one loosely regulated sector to run so much of the world.Weeks before the pandemic, the RAND Corporation published a study on systemic risk and how a problem with one company can imperil others in its network. Systemic risk was a big issue in the 2008 financial collapse, when the government propped up some companies because their downfall might imperil the whole system. They were too big to fail.The research group investigated whether tech companies had supplanted financial firms as a key node in the economy, and if the economy was growing too dependent on them. Amazon, whose AWS cloud division has millions of customers, was highlighted.In December, RAND’s point was made when SolarWinds, which makes software that allows other companies to manage their networks, was revealed to have been infiltrated by Russian hackers. Since SolarWinds had so many clients, including Fortune 500 companies and federal agencies, the breach became one of the worst on record.Tech’s dominance means the risks are more concentrated than ever. There were problems at the security firm Cloudflare in July 2020, at Amazon in November, at the cloud provider Fastly last month and at the content distribution network Akamai on Thursday, all of which took down other sites at least briefly.These outages caused little concern.That’s typical of systemic issues, said Jonathan Welburn, a lead author on the RAND study. “Before 2008, when house prices kept rising and rising, no one wanted to hear how they were being artificially propped up and why that could be a problem,” he said.Pushing Forward“When people are remote, I worry about what their career trajectory is going to be,” IBM’s chief executive, Arvind Krishna, recently told the BBC.Brian Ach/Getty ImagesThe pandemic gave tech companies the power and the cash to make aggressive bets on their individual destinies. Buying another company was one way to do this. Global deal values in tech soared 47.3 percent in 2020 from a year ago.Zillow, a digital real estate company in Seattle, spent $500 million in February to buy ShowingTime, a scheduling platform for home showings. A few weeks later, Zillow said it would hire 2,000 people, increasing its work force by 40 percent.But its biggest bet will take longer to play out. Before the pandemic, Zillow discouraged working from home, like most companies. Then last summer, it said 90 percent of its employees could work remotely forever if they chose.At the time, Zillow was in the vanguard of a movement. Now the idea of the non-virtual office is re-exerting its pull with managers.Amazon says its plan “is to return to an office-centric culture as our baseline.” Google asserted the same thing, although it backed off after workers rebelled. IBM says 80 percent of its employees will be in the office at least three days a week.“When people are remote, I worry about what their career trajectory is going to be,” IBM’s chief executive, Arvind Krishna, told the BBC.Zillow is something of an outlier. Even after a year of working from home, 59 percent of its employees told the company they planned to go into the office once a month or less.This may be the pandemic’s ultimate tailwind: not just the future coming much faster to your company, but actively pushing your company faster into the future. It is a risk that might be easier to undertake if your market value has suddenly tripled the way Zillow’s did.If Zillow is wrong about the future and employees are less bound to an office they visit only virtually, the company will stumble. If it is right, it will increase its workers’ loyalty and outdistance earthbound competitors.“The pandemic forced change on all of us,” said Jeremy Wacksman, Zillow’s chief operating officer. “We didn’t wish for it but now we’re learning from it.”More than a third of Zillow employees moved in the year that began in March 2020. Many moves were from one part of Seattle’s metro area to another, indicating a general reluctance not to get so far away from the office you could not drive there. But other employees dispersed to New Mexico, Mississippi and Alabama. Nine moved to Hawaii.“They liked their job but wanted to go somewhere else. That used to be a problem. Now it’s not,” said Viet Shelton, a Zillow spokesman who, as it happens, just moved to Manhattan from Seattle because he always wanted to live in New York.Now that employees no longer have to live where Zillow has an office, interest has swelled. More than 55,000 applied to work at Zillow in the first quarter, up 51 percent from the prepandemic level and about 10 applicants for every person employed there. Zillow has hired more recruiters to deal with the onslaught.Over at Redfin, the stock is up 400 percent from its pandemic bottom. Redfin paid $608 million in February to acquire a publisher of rental listings, its biggest deal ever. But while the company seems so rich, so successful, so lucky from the outside, it feels different within. Managing growth is almost as hard as managing a downturn.“Customers are clamoring for service and we can’t hire fast enough,” said Mr. Kelman. “Redfin never had a moment when it was absolutely and totally killing it, but I always imagined when we did that it would be more fun than this.” More

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    Work at Home or the Office? Either Way, There’s a Start-Up for That.

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    As more Americans return to an office a few days a week, start-ups providing tools for hybrid work are trying to cash in.SAN FRANCISCO — Before the pandemic, Envoy, a start-up in San Francisco, sold visitor registration software for the office. Its system signed in guests and tracked who was coming into the building.When Covid-19 hit and forced people to work from home, Envoy adapted. It began tracking employees instead of just visitors, with a screening system that asked workers about potential Covid symptoms and exposures.Now as companies begin reopening offices and promoting more flexibility for employees, Envoy is changing its strategy again. Its newest product, Envoy Desks, lets employees book desks for when they go into their company’s workplace, in a bet that assigned cubicles and five days a week in the office are a thing of the past.Envoy is part of a wave of start-ups trying to capitalize on America’s shift toward hybrid work. Companies are selling more flexible office layouts, new video-calling software and tools for digital connectivity within teams — and trying to make the case that their offerings will bridge the gaps between an in-person and remote work force.The start-ups are jockeying for position as more companies announce plans for hybrid work, where employees are required to come in for only part of the week and can work at home the rest of the time. In May, a survey of 100 companies conducted by McKinsey found that nine out of 10 organizations planned to combine remote and on-site working even after it was safe to return to the office.Providing tools for remote work is potentially lucrative. Companies spent $317 billion last year on information technology for remote work, according to the research company Gartner. Gartner estimated that spending would increase to $333 billion this year.An Envoy employee demonstrating how to use the software to book a desk.Lauren Segal for The New York TimesHybrid and remote work have the potential to benefit workers for whom office environments were never a good fit, said Kate Lister, president of the consulting firm Global Workplace Analytics. This includes women, racial minorities, people with caregiving responsibilities and those with disabilities, along with introverts and people who simply prefer to work at odd hours or in solitude.But she and others also warned that the move to hybrid work could make remote workers “second-class citizens.” Workers who miss out on the camaraderie of in-person meetings or the spontaneity of hallway chats may end up being passed over for raises and promotions, they said.That, start-up founders argue, is where their products come in.Rajiv Ayyangar, the chief executive and co-founder of Tandem, leads one of several software start-ups that have created desktop apps that help teams better collaborate with one another and that recreate the feeling of being in an office. He said Tandem’s product was trying to help with “presence” — the ability to know what one’s teammates are doing in real time, even if the worker is not with their colleagues in the office.Tandem’s desktop program, which costs $10 a month for each user, shows what teammates are working on so colleagues know if they are available for a spontaneous video call within the app. The list of user statuses automatically updates to let people know if their co-workers are on a call, writing in Google Docs or doing some other task.Pragli and Tribe, two software start-ups that have been around since 2019, also offer similar products. People can use Pragli’s product to create standing audio or video calls that others can join. It is free, though the company plans to introduce a paid product. Tribe’s software uses busy and available statuses to facilitate in-platform video calls; it is currently only accessible with an invitation.Owl Labs, a start-up founded in 2017, is also trying to tackle “presence.” It makes a 360-degree video camera, microphone and speaker that sits in the middle of a conference table and automatically zooms in on the person who is speaking.Owl’s 360-degree camera, microphone and speaker system is intended to remote workers to attend meetings seamlessly.Owl LabsThe company, which said its customers quadrupled to more than 75,000 organizations over the pandemic, said the $999 camera was a way for remote workers to participate in office meetings by being able to see everyone who is speaking, rather than the limited view enabled by a single laptop camera.Other start-ups, such as Kumospace and Mmhmm, said they were working on improving video communications for hybrid work. Kumospace, a video-calling start-up, structures calls so that users enter a virtual room. They then navigate the room using arrow keys and can talk to people when they are close to them.The design is meant to replicate in-person socializing, where people can mill around and have multiple conversations in the same room. That contrasts with a service like Zoom, where everyone is by default in the same conversation as soon as they enter the video call.Mmhmm, which was created by the founder of the note-taking and productivity app Evernote, Phil Libin, offers a variety of interactive video backgrounds, tools for sharing slideshows and other features for live conversations and asynchronous presentations. It has a free version and a premium version, which costs $8.33 per employee a month.Some companies said their products can help businesses understand their space usage as fewer workers come in needing desks. Density, a start-up in San Francisco, makes a product that uses custom depth sensors to measure how many people are entering an area or use an open space. Companies can then analyze that data to understand how much of their office space they are actually using, and downsize as necessary.Density also plans to offer other tools for hybrid work. Last month, it acquired a software start-up that provides a system for desk and space reservation.Envoy said its new Desks product had attracted 400 companies, including the clothing retailer Patagonia and the film company Lionsgate.Larry Gadea, chief executive of Envoy, at the company’s headquarters.Lauren Segal for The New York Times“The companies that use us get much more accurate data that’s standardized across all their offices globally,” said Larry Gadea, Envoy’s chief executive. “And then it’s around using that data to inform space planning things. Do we need more floors? Do we need more meeting rooms? Do we need more desks? Do we need more desks for this one team?”Lionsgate said it had used Envoy’s products since before the pandemic. When the coronavirus arrived, it turned to Envoy’s employee-screening software to provide health checks to those entering the office.Now, as more employees return to in-person work, the company is using Envoy to manage where everyone sits, as well as to track who is coming in. Lionsgate said the information can help determine how often teams will need to be in the office.“We’ll be able to know really how much space we need,” said Heather Somaini, Lionsgate’s chief administrative officer. “So I think it’ll be really useful.” More

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    Supreme Court Rejects Request to Lift Federal Ban on Evictions

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    The C.D.C. had imposed an eviction moratorium, saying it was needed to address the coronavirus pandemic.WASHINGTON — The Supreme Court on Tuesday refused to lift a moratorium on evictions that had been imposed by the Centers for Disease Control and Prevention in response to the coronavirus pandemic.The vote was 5 to 4, with Chief Justice John G. Roberts Jr. and Justices Stephen G. Breyer, Sonia Sotomayor, Elena Kagan and Brett M. Kavanaugh in the majority.The court gave no reasons for its ruling, which is typical when it acts on emergency applications. But Justice Kavanaugh issued a brief concurring opinion explaining that he had cast his vote reluctantly and had taken account of the impending expiration of the moratorium.“The Centers for Disease Control and Prevention exceeded its existing statutory authority by issuing a nationwide eviction moratorium,” Justice Kavanaugh wrote. “Because the C.D.C. plans to end the moratorium in only a few weeks, on July 31, and because those few weeks will allow for additional and more orderly distribution of the congressionally appropriated rental assistance funds, I vote at this time to deny the application” that had been filed by landlords, real estate companies and trade associations.He added that the agency might not extend the moratorium on its own. “In my view,” Justice Kavanaugh wrote, “clear and specific congressional authorization (via new legislation) would be necessary for the C.D.C. to extend the moratorium past July 31.”At the beginning of the pandemic, Congress declared a moratorium on evictions, which lapsed last July. The C.D.C. then issued a series of its own moratoriums.“In doing so,” the challengers told the justices, “the C.D.C. shifted the pandemic’s financial burdens from the nation’s 30 to 40 million renters to its 10 to 11 million landlords — most of whom, like applicants, are individuals and small businesses — resulting in over $13 billion in unpaid rent per month.” The total cost to the nation’s landlords, they wrote, could approach $200 billion.The moratorium defers but does not cancel the obligation to pay rent; the challengers wrote that this “massive wealth transfer” would “never be fully undone.” Many renters, they wrote, will be unable to pay what they owe. “In reality,” they wrote, “the eviction moratorium has become an instrument of economic policy rather than of disease control.”In urging the Supreme Court to leave the moratorium in place, the government said that continued vigilance against the spread of the coronavirus was needed and noted that Congress has appropriated tens of billions of dollars to pay for rent arrears.The challengers argued that the moratorium was not authorized by the law the agency relied on, the Public Health Service Act of 1944.The 1944 law, the challengers wrote, was concerned with quarantines and inspections to stop the spread of disease and did not bestow on the agency “the unqualified power to take any measure imaginable to stop the spread of communicable disease — whether eviction moratoria, worship limits, nationwide lockdowns, school closures or vaccine mandates.”The C.D.C. argued that the moratorium was authorized by the 1944 law. Evictions would accelerate the spread of the coronavirus, the agency said, by forcing people “to move, often into close quarters in new shared housing settings with friends or family, or congregate settings such as homeless shelters.”The case was complicated by congressional action in December, when lawmakers briefly extended the C.D.C.’s moratorium through the end of January in an appropriations measure. When Congress took no further action, the agency again imposed moratoriums under the 1944 law.In its Supreme Court brief, the government argued that it was significant that Congress had embraced the agency’s action, if only briefly.Last month, Judge Dabney L. Friedrich of the Federal District Court in Washington ruled that the agency had exceeded its powers in issuing the moratorium.“The question for the court,” she wrote, “is a narrow one: Does the Public Health Service Act grant the C.D.C. the legal authority to impose a nationwide eviction moratorium? It does not.”Judge Friedrich granted a stay of her decision while the government appealed, leaving the moratorium in place. A unanimous three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit declined to lift the stay, saying the government was likely to prevail on appeal.Whatever else may be said about the eviction moratorium, the challengers told the Supreme Court, it has outlived its purpose.“The government may wish to prolong the moratorium to see out its economic-policy goals,” they wrote, “but that does not render its stated justification plausible. Forcing landlords to provide free housing for vaccinated Americans may be good politics, but it cannot be called health policy.” More

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    Hot Vax Summer Is Looking Lukewarm

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    The latest jobs report suggests that getting the economy back up to speed is not going to be effortless.Scene from a diner in New York City last fall. Finding people to fill jobs, particularly those like restaurant work, is proving hard for employers.Laylah Amatullah Barrayn for The New York TimesNow that’s more like it.Employers added 559,000 jobs in May, and created more jobs in March and April than earlier estimates suggested. The shockingly weak April number that confounded economists four weeks ago (originally reported as a gain of 266,000 jobs, now revised up to 278,000) looks like an aberration, not a major downshift in the pace of recovery.But that doesn’t mean all is well. Just a few weeks ago, it seemed more likely than not that the United States was on the verge of a boom summer, a time of explosive growth that would bring the economy back to full health faster than in any recovery in memory.It has become increasingly clear, however — both from anecdotal reports and in data — that a reopening spurred on by vaccination is harder than it once seemed. The possibility of adding a million jobs a month seemed within grasp not long ago, but now looks more like wishful thinking.It’s not so much a hot vax summer as a warm vax summer.If you average the last three months of job creation, employers are adding 541,000 positions a month. In a normal expansion, that would be great; it’s a higher number than was attained for even a single month in the recovery that began in 2009. But it does not imply a return to full health in the immediate future.At the job creation rate of the last three months, it would take 14 months to return to February 2020 employment levels — longer if the goal is to return to the prepandemic employment trend.Unlike in a typical recovery, the problem appears to be the supply of labor, not the demand for it. Job openings are at record highs and employers are eager to hire, but they can’t find workers, at least not at the wages they are used to paying.The details of the May numbers support this idea. Wages are soaring — average hourly earning were up 0.5 percent, yet the share of adults in the labor force actually ticked down. The number of people not in the labor force rose by 160,000, implying more people just said, “Forget it, I’m not even looking for a job.”There have been heated debates over whether this is a result of expanded unemployment insurance benefits, which may give people less incentive to work; concerns related to child care and Covid-related health risks; or perhaps a broader psychological reset for many would-be workers.These are not mutually exclusive; all are likely to be contributors to this unusual moment in which demand for goods and services is soaring and supply of them is constrained.An open question is how much labor supply might increase in some states that end expanded jobless benefits earlier than the September expiration date contained in federal law.The details of the industries that are adding jobs similarly point to reopening struggles. The leisure and hospitality sector, which suffered the worst damage from the pandemic, added 292,000 jobs in May. That sounds great, but is actually slower than the 328,000 jobs it added in April.In other words, even as the nation was four weeks further along in achieving widespread vaccination, and seemingly every restaurant in the country was complaining it couldn’t hire enough waiters, cooks and dishwashers, the pace of recovery in that sector slowed rather than accelerated.To the degree that the labor supply shortage is about people re-evaluating their priorities, it’s not necessarily a bad thing. It could lead to a more lasting reset of compensation and work standards across the economy.But it does have implications for politics and the economy as a whole. For instance, Democrats want to run on a boom-time economy in the 2022 midterms. That will be hard to do if the supply of labor turns out to have shifted lower in the long term.In this strange reopening summer, there have been supply constraints on many things, including lumber, computer chips and used cars. But there is a big difference between those supply problems and the labor supply problem: Humans, unlike lumber and semiconductors, can make choices.To the degree that the labor shortage is caused by expanded jobless benefits or schools that are closed, it should go away in time. To the degree there is a broader rethinking of the role of work in people’s lives, this phenomenon will outlast this post-pandemic summer, whatever its temperature ultimately turns out to be. More

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    Global Shortages During Coronavirus Reveal Failings of Just in Time Manufacturing

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    Global shortages of many goods reflect the disruption of the pandemic combined with decades of companies limiting their inventories.In the story of how the modern world was constructed, Toyota stands out as the mastermind of a monumental advance in industrial efficiency. The Japanese automaker pioneered so-called Just In Time manufacturing, in which parts are delivered to factories right as they are required, minimizing the need to stockpile them. More

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    ‘We’re Suffering’: How Remote Work Is Killing Manhattan’s Storefronts

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    #styln-signup .styln-signup-wrapper { max-width: calc(100% – 40px); width: 600px; margin: 20px auto; padding-bottom: 20px; border-bottom: 1px solid #e2e2e2; } A big shift toward working from home is endangering hundreds of locally owned Manhattan storefronts that have been hanging on, waiting for life to return to the desolate streets of Midtown and the Financial District. The […] More

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    Covid-19 Pushes India’s Middle Class Toward Poverty

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    The pandemic sent 32 million people in India from the middle class last year. Now a second wave is threatening the dreams of millions more looking for a better life.NOIDA, India — Ashish Anand had dreams of becoming a fashion designer. A former flight attendant, he borrowed from relatives and poured his $5,000 life savings into opening a clothing shop on the outskirts of Delhi selling custom-designed suits, shirts and pants.The shop, called the Right Fit, opened in February 2020, just weeks before the coronavirus struck India. Prime Minister Narendra Modi abruptly enacted one of the world’s toughest nationwide lockdowns to stop it. Unable to pay the rent, Mr. Anand closed the Right Fit two months later.Now Mr. Anand, his wife and his two children are among millions of people in India in danger of sliding out of the middle class and into poverty. They depend on handouts from his aging in-laws. Khichdi, or watery lentils cooked with rice, has replaced eggs and chicken at the dinner table. Sometimes, he said, the children go to bed hungry.“I have nothing left in my pocket,” said Mr. Anand, 38. “How can I not give food to my children?”Now a second wave of Covid-19 has struck India, and the middle class dreams of tens of millions of people face even greater peril. Already, about 32 million people in India were driven into poverty by the pandemic last year, according to the Pew Research Center, accounting for a majority of the 54 million who slipped out of the middle class worldwide.The pandemic is undoing decades of progress for a country that in fits and starts has brought hundreds of millions of people out of poverty. Already, deep structural problems and the sometimes impetuous nature of many of Mr. Modi’s policies had been hindering growth. A shrinking middle class would deal lasting damage.“It’s very bad news in every possible way,” said Jayati Ghosh, a development economist and professor at the University of Massachusetts Amherst. “It has set back our growth trajectory hugely and created much greater inequality.”The second wave presents difficult choices for India and Mr. Modi. India on Friday reported more than 216,000 new infections, another record. Lockdowns are back in some states. With work scarce, migrant workers are packing into trains and buses home as they did last year. The country’s vaccination campaign has been slow, though the government has picked up the pace.Yet Mr. Modi appears unwilling to repeat last year’s draconian lockdown, which left more than 100 million Indians jobless and which many economists blame for worsening the pandemic’s problems. His government has also been reluctant to increase spending substantially like the United States and some other places, instead releasing a budget that would raise spending on infrastructure and in other areas but that also emphasizes cutting debt.Anil G. Kumar lives in Palam, one of the many neighborhoods in Delhi that have been hurt by the pandemic.Smita Sharma for The New York TimesThe Modi government has defended its handling of the pandemic, saying vaccinations are making progress and that signs point to an economic resurgence. Economists are forecasting a rebound in the coming year, though the sudden rise in infections and India’s slow vaccination rate — less than 9 percent of the population has been inoculated — could undermine those predictions.The heady growth forecasts feel far away for Nikita Jagad, who was out of work for over eight months. Ms. Jagad, a 49-year-old resident of Mumbai, stopped going out with her friends, eating at restaurants and even taking bus rides, unless the trip was for a job interview. Sometimes, she said, she shut herself inside her bathroom so her 71-year-old mother wouldn’t hear her crying.Last week, Ms. Jagad got a new job as a manager at a company that provides housekeeping services for airlines. It pays less than $400 a month, roughly half her previous salary. It could also be short-lived: the state of Maharashtra, home to Mumbai, announced lockdown-like measures this week to stop the spreading second wave.If she loses her new job, Ms. Jagad is still the only support for her mother. “If something happens to her,” she said, “I don’t have the money to even admit her in the hospital.”India’s middle class may not be as wealthy as its peers in the United States and elsewhere, but it makes up an increasingly potent economic force. While definitions vary, Pew Research defines middle-class and upper-middle-class households as living on about $10 to $50 a day. The kind of income could give an Indian family an apartment in a nice neighborhood, a car or a scooter, and the opportunities to send their children to a private school.Roughly 66 million people in India meet that definition, compared with about 99 million just before the pandemic last year, according to Pew research estimates. These increasingly affluent Indian families have drawn foreign companies like Walmart, Amazon, Facebook, Nissan and others to invest heavily in a country of aspirational consumers.A collage of vacation photographs in Ashish Anand’s apartment in Noida, a reminder of the good times the family once had.Smita Sharma for The New York TimesAnil G. Kumar, a civil engineer, was one of them. Around this time last year, he and his family were about to buy a two-bedroom apartment. But when last year’s lockdown hit, Mr. Kumar’s employer, a construction chemicals manufacturer, slashed his salary by half.“Everything turned turtle within a few hours,” he said. Three months later, his job had been eliminated.Now Mr. Kumar spends his days in his home in a working-class neighborhood in the western part of Delhi, searching for jobs on LinkedIn and taking care of his son.The family’s middle-class life is now under threat. They survive on the $470-a-month salary Mr. Kumar’s wife draws from a private university. Instead of holding a big celebration for their son’s 10th birthday at a restaurant, which would have cost nearly $70, they ordered a cake and a new outfit for about one-fifth the cost. Mr. Kumar also canceled his Amazon Prime subscription, which he hadn’t used in a while.“Every day you can’t sit on the laptop,” he said. “At times, you feel depressed.”India’s middle class is central to more than the economy. It fits into India’s broader ambitions to rival China, which has grown faster and more consistently, as a regional superpower.To get there, the Indian government may need to address the people the coronavirus has left behind. Household incomes and overall consumption have weakened, even though the sales of some goods have increased recently because of pent-up demand. Many of the hardest hit come from India’s merchant class, the shopkeepers, stall operators or other small entrepreneurs who often live off the books of a major company.“India is not even discussing poverty or inequality or lack of employment or fall in incomes and consumption,” said Mahesh Vyas, the chief executive of the Center for Monitoring of the Indian Economy. “This needs to change first and foremost,” he said.Mr. Kumar with his 10-year-old son, Akshay, in the Palam neighborhood in Delhi, India. Mr. Kumar lost his job as a civil engineer during last year’s lockdown.Smita Sharma for The New York TimesMost Indians are “tired” and “discouraged” by the lack of jobs, said Mr. Vyas, especially low-skilled workers.“Unless this problem is addressed,” he said, “this will be a millstone that will hold back India’s sustained growth.”Mr. Anand, the prospective fashion designer, who lives in the industrial hub of Noida in the southeastern Delhi area, found himself at wit’s end during last year’s lockdown. The family fell behind on the rent. Two months into the lockdown, he collapsed in what he described as a panic attack.“We did not want to live,” said his wife, Akanksha Chadda, 33, a former operations manager at a luxury retail store who also hasn’t been able to find a job. She sat facing a photograph taken three years ago of her son and daughter sitting on a giant turtle at an amusement park. “I didn’t know if I would wake up the next morning or not.”The days when they could afford muesli for breakfast and pizza for dinner are gone, said Mr. Anand. On good days, they get some vegetables and banana for the kids.In January, Ms. Chadda sold their 8-year-old son’s bicycle to buy milk, lentils and vegetables. He cried for a solid evening. But she felt she had little choice. She had already sold her jewelry the month before.“When you don’t see a ray of hope,” she said, “you lose it.” More