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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

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    How the U.S. Got It (Mostly) Right in the Economy’s Rescue

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    #masthead-section-label, #masthead-bar-one { display: none }Biden’s Stimulus PlanBiden’s AddressWhat to Know About the BillAnalysis: Economic RescueBenefits for Middle ClassShoppers at a mall in Los Angeles. Consumer spending is nearly back to its prepandemic level.Credit…Mark Abramson for The New York TimesAnalysisHow the U.S. Got It (Mostly) Right in the Economy’s RescueThough the recession has been painful, policymakers cushioned the pandemic’s blow and opened the way to recovery.Shoppers at a mall in Los Angeles. Consumer spending is nearly back to its prepandemic level.Credit…Mark Abramson for The New York TimesSupported byContinue reading the main storyMarch 15, 2021Updated 2:31 p.m. ETWhen the coronavirus pandemic ripped a hole in the economy a year ago, many feared that the United States would repeat the experience of the last recession, when a timid and short-lived government response, in the view of many experts, led to years of high unemployment and anemic wage growth.Instead, the federal government responded with remarkable force and speed. Within weeks after the virus hit American shores, Congress had launched a multitrillion-dollar barrage of programs to expand unemployment benefits, rescue small businesses and send checks to most American households. And this time, unlike a decade ago, Washington is keeping the aid flowing even as the crisis begins to ease: On Thursday, President Biden signed a $1.9 trillion aid bill that will pump still more cash into households, businesses, and state and local governments.The Federal Reserve, too, acted swiftly, deploying emergency tools developed in the financial crisis a decade earlier. Those efforts helped safeguard the financial system — and the central bank has pledged to remain vigilant.The result is an economy far stronger than most forecasters expected last spring, even as the pandemic proved much worse than feared. The unemployment rate has fallen to 6.2 percent, from nearly 15 percent in April. Consumer spending is nearly back to its prepandemic level. Households are sitting on trillions of dollars in savings that could fuel an epic rebound as the health crisis eases.Yet not everyone made it into the lifeboats unscathed, if at all. Millions of laid-off workers waited weeks or months to begin receiving help, often with lasting financial consequences. Aid to hundreds of thousands of small businesses dried up long before they could welcome back customers; many will never reopen. Long lines at food banks and desperate pleas for help on social media reflected the number of people who slipped through the cracks.“The damage that has been done has occurred in a disparate fashion,” said Michelle Holder, a John Jay College economist who has studied the pandemic’s impact. “It’s occurred among low-income families. It’s occurred among Black and brown families. It’s certainly occurred among families that did not have a lot of resources to fall back on.”For many white-collar workers, Dr. Holder said, the pandemic recession may one day look like a mere “bump in the road.” But not for those hit hardest.“It wasn’t just a bump in the road if you were a low-wage worker, if you were a low-income family,” she said. “Their ability to recover is just not the same as ours.”Jesus Quinonez lost his job as a manager at a warehouse in the San Diego area early in the pandemic. He quickly found another job — with a company that shut down before he could begin work. He hasn’t worked since.It took Mr. Quinonez, 62, three months to fight his way through California’s overwhelmed unemployment insurance system and begin receiving benefits. Less than two months later, a $600-a-week unemployment supplement from the federal government expired, leaving Mr. Quinonez, his wife and his four children trying to subsist on a few hundred dollars a week in regular unemployment benefits.By January, Mr. Quinonez was four months behind on rent on the one-bedroom trailer he shares with his family. He had raided his 401(k) account, leaving no savings a few years before his intended retirement. Government nutrition assistance kept his family fed, but it didn’t help with the car payment, or pay for toilet paper.“I started falling behind on my bills, plain and simple,” he said.A closed storefront in Newark. Not everyone made it into the lifeboats unscathed.Credit…Bryan Anselm for The New York TimesFor hundreds of thousands of small businesses, government aid dried up long before they could welcome back customers. Many will never reopen.Credit…Bryan Anselm for The New York TimesBut in December, Congress passed a $900 billion aid package, which included a second round of direct checks to households and revived the expanded unemployment programs. By January, Mr. Quinonez was able to pay off at least part of his debt, enough to hold on to the trailer and his car. The next round of aid should carry Mr. Quinonez until he can work again.“As soon as they lift the restrictions and more people get vaccinated, I see things coming back good,” he said. “I expect to get a job, and I expect to continue working until I retire.”Whether Mr. Quinonez’s story — and millions more like it — should count as a success or failure for public policy is partly a matter of perspective. Mr. Quinonez himself is unimpressed: He worked and paid taxes for decades, then found himself subject to a decrepit state computer system and a divided Congress.“Now that we need them, there’s no freaking help,” he said.Research from Eliza Forsythe, an economist at the University of Illinois, found that from June until Feb. 17, only 41 percent of unemployed workers had access to benefits. Some of the rest were unaware of their eligibility or couldn’t navigate the thicket of rules in their states. Others simply weren’t eligible. Asian workers, Black workers and those with less education were disproportionately represented among the nonrecipients.The gaps and delays in the system had consequences.“The impact of that is folks’ having to move out of their apartments because they have this money that’s supposed to be coming but they just haven’t received it,” said Rebecca Dixon, executive director of the National Employment Law Project, a worker advocacy group. Others kept their homes because of eviction bans, but had their utilities shut off, Ms. Dixon added, or turned to food banks to avoid going hungry — measures of food insecurity surged in the pandemic.Still, the federal government did far more for unemployed workers than in any previous recession. Congress expanded the safety net to cover millions of workers — freelancers, part-time workers, the self-employed — who are left out in normal times. At the peak last summer, the state and federal unemployment systems were paying $5 billion a day in benefits — money that helped workers avoid evictions and hunger and that flowed through the economy, preventing an even worse outcome.The record of other federal responses is similarly mixed. The Paycheck Protection Program helped hundreds of thousands of small businesses but was plagued by administrative hiccups and, at least according to some estimates, saved relatively few jobs. Direct checks to households similarly helped keep families afloat, but sent billions of dollars to households that were already financially stable, while failing to reach some of those who needed the help the most — in some cases because they had not filed tax returns or did not have bank accounts.Beyond the successes and failures of specific programs, any evaluation of the broader economy needs to start with a question: Compared with what?Relative to a world without Covid-19, the economy remains deeply troubled. The United States had 9.5 million fewer jobs in February than a year earlier, a hole deeper than in the worst of the last recession. Gross domestic product fell 3.5 percent in 2020, making it among the worst years on record.Relative to the rosy predictions early in the pandemic — when economists hoped a brief shutdown would let the country beat the virus, then get quickly back to work — the downturn has been long and damaging. But those hopes were dashed not by a failure of economic policy but by the virus itself, and the failure to contain it.“If you want to think back on what we got wrong, really the fundamental errors were about the spread of the virus,” said Karen Dynan, a Harvard economist and Treasury Department official during the Obama administration. But relative to the outcome that forecasters feared in the worst moments last spring, the rebound has been remarkably strong. In May, economists at Goldman Sachs predicted that the unemployment rate would be 12 percent at the end of 2020 and wouldn’t fall below 6 percent until 2024. The same team now expects the rate to fall to 4 percent by the end of this year. Other forecasters have similarly upgraded their projections..css-yoay6m{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}@media (min-width:740px){.css-yoay6m{font-size:1.25rem;line-height:1.4375rem;}}.css-1dg6kl4{margin-top:5px;margin-bottom:15px;}.css-k59gj9{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;width:100%;}.css-1e2usoh{font-family:inherit;display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;border-top:1px solid #ccc;padding:10px 0px 10px 0px;background-color:#fff;}.css-1jz6h6z{font-family:inherit;font-weight:bold;font-size:1rem;line-height:1.5rem;text-align:left;}.css-1t412wb{box-sizing:border-box;margin:8px 15px 0px 15px;cursor:pointer;}.css-hhzar2{-webkit-transition:-webkit-transform ease 0.5s;-webkit-transition:transform ease 0.5s;transition:transform ease 0.5s;}.css-t54hv4{-webkit-transform:rotate(180deg);-ms-transform:rotate(180deg);transform:rotate(180deg);}.css-1r2j9qz{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-e1ipqs{font-size:1rem;line-height:1.5rem;padding:0px 30px 0px 0px;}.css-e1ipqs a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;}.css-e1ipqs a:hover{-webkit-text-decoration:none;text-decoration:none;}.css-1o76pdf{visibility:show;height:100%;padding-bottom:20px;}.css-1sw9s96{visibility:hidden;height:0px;}#masthead-bar-one{display:none;}#masthead-bar-one{display:none;}.css-1cz6wm{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;font-family:’nyt-franklin’,arial,helvetica,sans-serif;text-align:left;}@media (min-width:740px){.css-1cz6wm{padding:20px;width:100%;}}.css-1cz6wm:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-1cz6wm{border:none;padding:20px 0 0;border-top:1px solid #121212;}Frequently Asked Questions About the New Stimulus PackageThe stimulus payments would be $1,400 for most recipients. Those who are eligible would also receive an identical payment for each of their children. To qualify for the full $1,400, a single person would need an adjusted gross income of $75,000 or below. For heads of household, adjusted gross income would need to be $112,500 or below, and for married couples filing jointly that number would need to be $150,000 or below. To be eligible for a payment, a person must have a Social Security number. Read more. Buying insurance through the government program known as COBRA would temporarily become a lot cheaper. COBRA, for the Consolidated Omnibus Budget Reconciliation Act, generally lets someone who loses a job buy coverage via the former employer. But it’s expensive: Under normal circumstances, a person may have to pay at least 102 percent of the cost of the premium. Under the relief bill, the government would pay the entire COBRA premium from April 1 through Sept. 30. A person who qualified for new, employer-based health insurance someplace else before Sept. 30 would lose eligibility for the no-cost coverage. And someone who left a job voluntarily would not be eligible, either. Read moreThis credit, which helps working families offset the cost of care for children under 13 and other dependents, would be significantly expanded for a single year. More people would be eligible, and many recipients would get a bigger break. The bill would also make the credit fully refundable, which means you could collect the money as a refund even if your tax bill was zero. “That will be helpful to people at the lower end” of the income scale, said Mark Luscombe, principal federal tax analyst at Wolters Kluwer Tax & Accounting. Read more.There would be a big one for people who already have debt. You wouldn’t have to pay income taxes on forgiven debt if you qualify for loan forgiveness or cancellation — for example, if you’ve been in an income-driven repayment plan for the requisite number of years, if your school defrauded you or if Congress or the president wipes away $10,000 of debt for large numbers of people. This would be the case for debt forgiven between Jan. 1, 2021, and the end of 2025. Read more.The bill would provide billions of dollars in rental and utility assistance to people who are struggling and in danger of being evicted from their homes. About $27 billion would go toward emergency rental assistance. The vast majority of it would replenish the so-called Coronavirus Relief Fund, created by the CARES Act and distributed through state, local and tribal governments, according to the National Low Income Housing Coalition. That’s on top of the $25 billion in assistance provided by the relief package passed in December. To receive financial assistance — which could be used for rent, utilities and other housing expenses — households would have to meet several conditions. Household income could not exceed 80 percent of the area median income, at least one household member must be at risk of homelessness or housing instability, and individuals would have to qualify for unemployment benefits or have experienced financial hardship (directly or indirectly) because of the pandemic. Assistance could be provided for up to 18 months, according to the National Low Income Housing Coalition. Lower-income families that have been unemployed for three months or more would be given priority for assistance. Read more.The recovery proved so strong in part because businesses were able to adapt better — and Americans, for better or worse, were willing to take more risks — than many people expected, allowing a faster rebound in activity over the summer. But the biggest factor was that Congress responded more quickly and forcefully than in any past crisis — a particularly remarkable outcome given that both the White House and Senate were controlled by Republicans, a party traditionally skeptical of programs like unemployment insurance.Millions of laid-off workers waited weeks or months to begin receiving help, a lag that often left financial consequences.Credit…Bryan Woolston/ReutersLong lines at food banks provided a hint of the number of people who slipped through the cracks.Credit…Tamir Kalifa for The New York Times“The dominant narrative about Washington and about legislating and public policy is one of dysfunction, one of not being able to rise to meet challenges, one of not being able to get it together to address glaring problems, and I think it’s a well-earned narrative,” said Michael R. Strain, an economist at the American Enterprise Institute. “But when I look back over the last year, that is just not what I see.”Congress didn’t prevent a recession. But its intervention, along with aggressive action from the Federal Reserve, may have prevented something much worse.“We could have experienced another Great Depression-like event that took years and years to recover from, and we didn’t,” Dr. Strain said.Washington’s moment of unity didn’t last. Democrats pushed for another multitrillion-dollar dose of aid. Republicans, convinced that the economy would rebound largely on its own once the pandemic eased, wanted a much smaller package. The stalemate lasted months, allowing aid to households and businesses to lapse. Economists are still debating the long-term impact of that delay, but there is little doubt it resulted in thousands of business failures.“We had this grand success that policymakers acted so quickly in passing two significant pieces of legislation early in the pandemic, and then they flailed through the whole fall in just the most frustrating of ways,” said Wendy Edelberg, director of the Hamilton Project, an economic-policy arm of the Brookings Institution. “That was just such an unforced error and created confusion and needless panic.”But unlike in 2009, when Republican opposition prevented any significant economic aid after President Barack Obama’s first few months in office, Congress did eventually provide more help. The $900 billion in aid passed in late December prevented millions of people from losing unemployment benefits, and helped sustain the recovery at a moment when it looked like it was faltering.The $1.9 trillion plan that Democrats pushed through Congress this month could help the United States achieve something it failed to do after the last recession: ensure a robust recovery.If that happens, it could fundamentally shift the narrative around the pandemic recession. The damage was deeply unequal, and the economic response, though it helped many families weather the storm, didn’t come close to overcoming that inequity. But a recovery that restores jobs quickly could help workers like Mr. Quinonez get back on track.“It’s just a bad year, and you just close the page and move on and try to make the best of the new days and new years,” he said. “Things are going to get better.”AdvertisementContinue reading the main story More

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    Photographer Captures Economic Impact of Covid on New York

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    #masthead-section-label, #masthead-bar-one { display: none }The Coronavirus OutbreakliveLatest UpdatesMaps and CasesRisk Near YouVaccine RolloutGuidelines After VaccinationAdvertisementContinue reading the main storySupported byContinue reading the main storyTimes InsiderA City Strapped: Photographing a New York in NeedThe pandemic shattered the city’s economy, affecting people’s homes, livelihoods and wallets. One photojournalist documented the hardships, as both a lament and a tribute.Madison Avenue on the Upper East Side, last September.Credit…Ashley Gilbertson for The New York TimesMarch 10, 2021, 5:00 a.m. ETTimes Insider explains who we are and what we do, and delivers behind-the-scenes insights into how our journalism comes together.Last year, as the coronavirus began spreading in New York, I worked closely with Renee Melides, a photo editor on the Business desk, on a photo essay that visualized the city as it became a global epicenter of the pandemic. When that piece was just a concept and life still seemed somewhat normal, the two of us sat over a coffee. To this day, it’s the only time I’ve had an editor green light an idea mid-pitch.“Yes,” Renee said, interrupting me. “Do it. Now.” And I walked outside and started photographing.Back then, anxiety and uncertainty dominated New York, and when the story ran, it led with an image of a man praying during a meal in a Greenwich Village McDonald’s.With that story published, I pulled back from daily assignments as a freelance photographer in an attempt to understand the virus, as well as the risks that my family and I faced. I never stopped working, though. Instead, I moved through many parts of New York on long daily runs. Nine miles out, nine miles back. I’d pass through different neighborhoods, assessing and acknowledging changes by shooting on my iPhone.For a while, the pictures were mostly empty streets, ambulances and those frightening freezer truck morgues. Then the spring surge abated and people started emerging, and the vulnerabilities of our city, exposed by the virus, became more apparent than ever. I would post images to my Instagram account, unsure of what else to do with them or even what I was trying to say.I could see that inequality had become more pronounced, observing the rich and the needy forced to share the same sidewalks. I watched as stores closed down on street corners one by one until nothing but “For Rent” signs remained, and I found myself stunned as I moved through parts of the city that were once thronged by tourists but were now empty. One day in Times Square, as I sat waiting for a pedestrian to pass through a composition I had made, it was quiet enough for me to hear the sounds of the traffic lights changing.The Coronavirus Outbreak More

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    They Were on Equal Footing. Then the Ground Shifted.

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    #masthead-section-label, #masthead-bar-one { display: none }The Coronavirus OutbreakliveLatest UpdatesMaps and CasesRisk Near YouVaccine RolloutNew Variants TrackerAdvertisementContinue reading the main storySupported byContinue reading the main storyThey Were on Equal Footing. Then the Ground Shifted.A year of pandemic restrictions has meant some friends are flush and others foundering.Robin Arnone, Tim Gallagher, Traci Warner, and Julie Stark are among the millions of Americans whose lives and careers have been upended by the pandemic.CreditFeb. 27, 2021, 5:00 a.m. ETRobin Arnone, a part-time trainer before the coronavirus pandemic, hasn’t set foot in the Colosseum Gym in Columbia, Md., since the virus shut it down almost a year ago. The gym is open again, but she doesn’t need the work. Things are going gangbusters in her other job as a home appraiser, and she hasn’t looked back.For Julie Stark, one of Ms. Arnone’s best friends and a professional dog walker, things are not so rosy. With many clients stuck at home in the pandemic and taking care of their own pets, her services are no longer in demand. Instead of walking seven dogs each day, she now walks three.Ms. Stark has had to economize, eliminating dance and gymnastics classes for her children to save $350 a month. She doesn’t know when her clients will want her back, but it’s not something she discusses with Ms. Arnone. “We don’t talk about money,” Ms. Stark said.“It would be awkward if she were a dog walker and doing unbelievably well,” she added. “I’m happy for her.”And there is a lot in Ms. Arnone’s life to be happy about. She replaced her used Lexus with a new one last year, and in December she indulged herself with a $550 Dyson hair dryer. “It felt a little ridiculous,” she said of the purchase. “But I worked hard, and if there’s any year I’m going to do it, it’s this year.”Robin Arnone and Julie Stark are among the millions of friends who were on a relatively equal financial footing before last March — people who would have thought nothing of splitting the check on a night out — and now find themselves on vastly different trajectories. Lockdowns changed what Americans can do as well as what services they need, and in the process created divergent fates for many workers.The pandemic has wreaked havoc on many who were already struggling. Nearly 10 million fewer people have jobs, and some 26 million reported not always having enough to eat, according to Census Bureau data.For the 50 percent or so of the population that make up the middle class — defined by Pew Research Center as having an income ranging from around $45,000 to $135,000 for a household of three — the toll has been uneven. Like a tornado, the pandemic can devastate one household and leave neighboring ones unscathed.Ms. Arnone’s world, in the Washington-Baltimore area, exemplifies that. The gym where she worked, the Colosseum, is owned by her friend Tim Gallagher. His monthly income at the gym is down 25 to 30 percent, and a quarter of the gym’s members have suspended their accounts. To save money, he has lowered the thermostat at home to 60 degrees from 65, and while his truck has more than 340,000 miles on it, he has no plans to replace it.“You just got to scrape along and gut it out,” he said. “We’re really struggling to get by.”But in Ms. Arnone’s other field, home appraising, her friends and colleagues are reaping rewards from the booming housing market, where January sales were up 23.7 percent from a year earlier, according to the National Association of Realtors. Ultralow mortgage rates have prompted a wave of refinancings, which require fresh appraisals.“I don’t have much to complain about,” said Traci Warner, a friend of Ms. Arnone’s and a home appraiser in Waldorf, Md., south of Washington. After her husband was laid off from his sales job in April, Ms. Warner’s work picked up the slack.It’s not that things are perfect, but unlike Mr. Gallagher, she does not feel that she is barely hanging on.This contrast is mirrored in the larger economy. Weekly unemployment claims by newly laid-off workers remain at historically elevated levels even as stock indexes reach record highs.Vaccines have arrived, but their slow rollout means it will be months before anything resembling normal activity can resume at restaurants, hotels, gyms, airports, malls and other businesses that depend on bringing people together.“It’s very uneven,” said Gregory Daco, chief U.S. economist at Oxford Economics, a forecasting and research group. “The recovery for the most vulnerable parts of the population will take years.” Not only are wages and salaries down for the hardest-hit segments of the work force, he noted, but so are overall employment and participation in the labor force.At the very top, the gains have been staggering. In eight months after the pandemic hit the United States, the wealth of the country’s roughly 650 billionaires grew by $1 trillion, according to a November study by the Institute for Policy Studies and other progressive groups. That included a $70 billion lift for just one of those magnates: the founder of Amazon, Jeff Bezos.White-collar employees, having emerged mostly unscathed from the sharp downturn in 2020, are looking forward to what they hope will be a robust recovery in 2021 once most people are vaccinated. Service workers, devastated by the idling of entire industries amid lockdowns and other restrictions, just want the pain to abate.The split was evident in the latest jobs report from the Labor Department. While professional and business services employment jumped by 97,000 in January, that job growth was almost entirely offset in the private sector by losses in retail, leisure and hospitality industries, among others.So while lines at food banks lengthen, new Teslas dot parking lots, and there are waiting lists for Peloton machines so the most fortunate can keep up with their workouts from home.Peter Atwater, a lecturer in economics at the College of William & Mary, has popularized a term for this phenomenon: the K-shaped recovery. While one arm of the K ascends, the other is driving lower. “There’s an enormous divide in confidence,” he said. “And we buy and spend based on how we feel.”Janet L. Yellen, the newly confirmed Treasury secretary, extended the metaphor during her confirmation hearings. “We are living in a K-shaped economy, one where wealth built upon wealth, while working families fell farther and farther behind,” she said.Life on the UpsideRobin Arnone replaced her used Lexus with a new one last year.Ms. Arnone misses her days at the gym, especially spending time with clients. It is the first time since she was 15 that she hasn’t worked as a trainer, she said. But she is feeling pretty good otherwise.Before the pandemic, she would train people in the morning and shift to her real estate work in the afternoon. Now she rises at 6 a.m. to start writing up appraisals before hitting the road to visit as many as eight homes in a day.“I’ve declined a boatload of appraisal jobs,” she said. “I just didn’t have the time.”After typically handling 500 appraisals a year, she did 635 last year. She is paid by the banks that issue the mortgages, and last year she estimates she earned roughly $250,000 for her services, up from about $185,000 in previous years.The Coronavirus Outbreak More

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    Hurt by Lockdowns, California’s Small Businesses Push to Recall Newsom

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    #masthead-section-label, #masthead-bar-one { display: none }At HomeBake: Maximalist BrowniesListen: To Pink SweatsGrow: RosesUnwind: With Ambience VideosAdvertisementContinue reading the main storySupported byContinue reading the main storyHurt by Lockdowns, California’s Small Businesses Push to Recall GovernorThe pain for such enterprises been particularly acute in the state, leading some to back an effort to replace Gov. Gavin Newsom.Daniela Del Gaudio, left, and Alexandra Del Gaudio, are the founders of the Wild Plum, a yoga studio in the San Fernando Valley in California. By the time they reopened last month, they said, they had $70,000 in debt.Credit…Rozette Rago for The New York TimesFeb. 19, 2021Updated 6:26 p.m. ETLOS ANGELES — Alexandra and Daniela Del Gaudio had never been to a political rally before, let alone one to protest a coronavirus lockdown and recall Gov. Gavin Newsom. But things had changed in the sisters’ lives since they opened the Wild Plum, a yoga and wellness space, in 2018.The Wild Plum, in California’s San Fernando Valley, closed in March when Mr. Newsom issued pandemic stay-at-home orders for the state. By the time the Wild Plum reopened last month, when Mr. Newsom relaxed the latest lockdown restrictions, the sisters had amassed $70,000 in debt. So there they were at a recent anti-Newsom rally in a restaurant parking lot in the Sherman Oaks neighborhood of Los Angeles, along with dozens of other business owners.“Everyone says to walk away, but we put everything we have into this,” Daniela Del Gaudio, 33, said. “We’re banging our heads trying to figure out what to do.”California was one of the earliest states to go into lockdown last spring, and it is now emerging from a second lockdown, which started in December. That stop-start-stop has created a groundswell of anger toward Mr. Newsom, a Democrat in the third year of his first term, that is increasingly fueling a movement to recall him from office in one of the bluest of blue states.Demonstrators rally for a recall of Gov. Gavin Newsom in Huntington Beach, Calif., in November.Credit…Marcio Jose Sanchez/Associated PressThe recall threat to Mr. Newsom has considerable momentum. Since March, 1.5 million Californians have signed a petition to oust Mr. Newsom, enough to trigger an election for a new governor. If enough of the signatures are verified, it will be the fourth recall election of a governor in American history.After they are verified and costs are estimated, the state has 60 to 80 days to schedule an election. Voters will be asked two questions on the ballot. The first is whether Mr. Newsom should be recalled. The second: Who should replace him? If the first question on the recall comes up short, the second becomes moot.The recall campaign has been funded by the Republican National Committee, which committed $250,000, as well as Silicon Valley tech investors such as Chamath Palihapitiya, who donated $100,000. Small-business owners have also been an engine behind the effort, said Randy Economy, the spokesman for the Recall Gavin Newsom campaign.“He’s broken the back of small-business owners and put many of them out of business for the rest of their lives,” Mr. Economy said. He said many were incensed when Mr. Newsom was photographed in November having dinner at the French Laundry, a temple to haute cuisine in Napa Valley, in violation of state guidelines. (When photos of the dinner were leaked, Mr. Newsom apologized for his behavior.) Small businesses across the country have suffered from shutdowns that sometimes seem to flare up as suddenly as surges in the coronavirus itself. Restaurants, gyms, corner stores and spas have closed, some after trying to hang in there for months.The pain in California has been acute. Nearly 40,000 small businesses had closed in the state by September — more than in any other state since the pandemic began, according to a report compiled by Yelp. Half had shut permanently, according to the report, far more than the 6,400 that had closed permanently in New York.Few of the pandemic choices that Mr. Newsom has faced have been easy. California has suffered enormously from Covid-19, with more than 3.5 million cases and 47,000 deaths. Los Angeles County, one of the hardest-hit places in the recent virus surge, has more than 1.2 million cases and 19,000 deaths.Dan Newman, a political strategist for Mr. Newsom, said the governor was focused on coronavirus vaccinations and reopening the state. Mr. Newman blamed “state and national G.O.P. partisans” for supporting “this Republican recall scheme in hopes of creating an expensive, distracting and destructive circus.”Acknowledging that the pandemic has “heavily impacted our small businesses,” the director of the Governor’s Office of Business and Economic Development, Dee Dee Myers, pointed to several state programs that offer them help. They include the California Small Business Covid-19 Relief Grant Program, the California Rebuilding Fund and the Main Street Hiring Tax Credit.Ronna McDaniel, chairwoman of the Republican National Committee, said in a statement that Mr. Newsom had “proven that he is woefully unqualified to lead the state of California.”In places such as Los Angeles County, where Mr. Newsom won 72 percent of the vote in 2018, and neighboring Orange County, a more conservative area, the small-business anger is particularly intense. One local business owner leading the movement to open California’s economy is Andrew Gruel, 40, a chef who owns Slapfish, a seafood restaurant chain.Mr. Gruel argued in an interview last month that California’s lockdown rules were confusing and hurt small businesses disproportionately. “None of the rules make sense,” he said one afternoon from the Slapfish in Huntington Beach.As evidence, Mr. Gruel pointed to the Walmart just up the road. While local restaurants could not have diners sit outside in the first lockdown, even six feet apart and with plexiglass between them, a Burger King inside the Walmart remained open, he said.“And that was legal,” he said. “It’s like W.W.E. in there, people cross-body blocking each other for B.K. delight.”Opposition to Mr. Newsom’s pandemic policies is particularly intense among small businesses in the Los Angeles area.Credit…David Walter Banks for The New York TimesMr. Gruel said he had laid off 100 people, had closed one of his restaurants permanently and was worried about the rest of Slapfish’s two dozen locations. The company has lost around $100,000 and taken on a lot of debt, he added.That afternoon, he let people sit outside anyway, even though it was against the lockdown restrictions at the time. “You could do a citizen’s arrest,” he suggested.Local business associations said they were also furious. Nick Rimedio, who serves on the West Hollywood Chamber of Commerce, said the lockdowns had widened a class divide. While quarantine has been almost relaxing for what he called the wealthy “Zoom class,” it has been a nightmare for the poor and middle class who have storefronts or work service jobs in businesses in the area, he said.“If you’re well-to-do, if you have a healthy stock portfolio, if you can work from home, you’ve saved on your commute. You’re doing great,” Mr. Rimedio said.Angela Marsden, the owner of Pineapple Hill Saloon and Grill, a cozy bar in Sherman Oaks, has become another anti-lockdown leader. In December, she posted a video on Facebook in which she was masked and near tears. She pointed the camera at a movie set with outdoor tables, which was legal, and then contrasted that with her newly built outdoor dining setup, which had just been banned. The video went viral, and she started a GoFundMe page that has raised $220,000.Last month, Ms. Marsden, 48, gathered dozens of local business owners, including the Del Gaudio sisters, to discuss how to survive and what to do to push for reopening. Many owned bars and restaurants; others owned gyms or spas. Almost all of their locations had been closed since March.They sat at different tables, spaced a few feet apart. Most wore masks most of the time.“Our retirement savings are gone,” said Joe Lyons, who owns the Celtic Raven Pub in Winnetka, Calif., with his wife, Belinda.Credit…Rozette Rago for The New York TimesBelinda and Joe Lyons, who own the Celtic Raven Pub and co-own JJ Sullivan’s Irish Pub in the San Fernando Valley, said they had furloughed 12 people. One of their suppliers was demanding payments they could not make, they said. The Celtic Raven landlord has been pressuring them for 10 months of unpaid rent. By March 1, they will be personally liable for $49,000 in back rent.“It’s going to kill us,” Mr. Lyons said. “Our retirement savings are gone.”But the hardest part, Ms. Lyons said, was Mr. Newsom’s policies.“When we were told we could open last June by Gavin Newson, I put full insurance back with the intention of reopening, only to be told that we could not,” she said. “That cost me over $8,000 that I’m still paying, as the insurance company would not cancel.”Another attendee was Guido Murga, the owner of One Headlight, a hospitality supplies distributor. He said his business was down because restaurants, his main customers, were hurting.“I sell napkins, straws, cherries, olives, to-go cups. When they close, I close,” he said. “I’m drowning week to week.”Ms. Marsden had never led a rally before, but she got into the energy of it.“Come April or May, how many of us will be here?” she asked, her voice rising.“None!” some in the crowd shouted.“I’m drowning week to week,” said Guido Murga, whose supply business in Los Angeles depends on restaurants.Credit…Rozette Rago for The New York TimesThe event was disrupted midway through when a small group of virus skeptics who had joined the crowd grew boisterous and demanded that people stop wearing masks. The moment reflected the complexity at play. Those fighting to open businesses in a responsible way were tangling with more Trumpist factions, who saw new allies in some of the apolitical business owners.Carey Ysais, owner of the bar Kahuna Tiki, stood up to call everyone back to order.“Guys, where you’re at is a different place than where we’re at,” Mr. Ysais said, as the anti-mask crowd jeered. “Are you a bar owner? Excuse me, are you a bar owner?”The Del Gaudio sisters did not leave optimistic.“We were raised to work hard. We’re not even given that opportunity,” Alexandra Del Gaudio, 36, said. “We’re trying to pull our families out of poverty.”Thomas Fuller More