North America Update: March 23
- Congress is trying to quickly pass a $1.8 trillion economic relief package as the COVID-19 outbreak wreaks havoc on the U.S. economy. Democrats have blocked a Senate Republican plan as negotiations continue between Senate Minority Leader Chuck Schumer and the Trump administration. Democrats say the package does too much to aid corporations damaged by the outbreak without going far enough to help workers. Meanwhile, House Speaker Nancy Pelosi said Democrats will unveil their own economic stimulus legislation in response to the coronavirus pandemic. The Pelosi legislation appears to have many of the same goals as the Senate plan, but it remains to be seen how differently the packages are structured.
- More states moved today to impose their own sweeping stay-at-home orders, which will soon cover more than 100 million Americans in more than a dozen states. On Monday, several states including Indiana, Massachusetts, Michigan, Oregon, Wisconsin, and West Virginia became the latest to announce sweeping directives to keep more people home to try to slow the spread of the virus before it overwhelms the capacities of hospitals to treat the sick. These states followed California, Illinois, and New York that moved last week to try to keep residents at home and close nonessential businesses.
- The U.S. Federal Reserve today unveiled a new generation of lending facilities to prevent a liquidity crunch from turning into a solvency crisis for American businesses. The central bank punctuated its moves, announced 90 minutes before markets in the U.S. opened Monday, with an unusually explicit and ominous warning about the perils ahead. “It has become clear that our economy will face severe disruptions,” the Fed said in its statement. “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate.”
- Prime Minister Justin Trudeau stated that Canada is still not at the point of declaring a national state of emergency, but continues to encourage provincial and local governments to take steps to restrict movement. Trudeau also announced that the federal government will spend $192 million on the development and production of COVID-19 vaccines and treatments. He also presented new measures to support farmers and agri-food businesses, including $5 billion in lending capacity for producers, agribusinesses, and food processors, as well as a six-month extension on loan repayments. Finally, he reinforced the importance of social distancing, telling Canadians “enough is enough. Go home and stay home.”
- Across the provinces, businesses and organizations face pressure to enforce social distancing upon penalty of fines or closure. More restaurants are switching to limited take-out options, and Quebec has shut down all schools until May 1. Ontario and Quebec today ordered the closure of all non-essential businesses. Health Minister Patty Hajdu has also reiterated that there are no exceptions to the 14-day isolation period upon returning from travel, and warned that under the quarantine act, citizens can face these fines and arrest for noncompliance. Quebec has begun issuing these fines.
- A number of Canadian grocery chains have announced pay increases, as well as additional safety measures like plexiglass screens, for their frontline and distribution-centre Today, food manufacturer Mondelez took steps to keep food on the shelves of grocery stores by introducing a “Premium Pay” program for its Canadian and U.S. employees who are making, shipping, or selling their products.
- The number of cases across the European continent increased at an increasingly high rate over the weekend. Cases in Spain, the United Kingdom, and Switzerland grew by over 60% between Friday and Monday. In France and Germany, numbers increased by over 50%.
- Italy saw a decrease in the number of new cases on Monday for the second straight day after posting a daily high in new cases and in deaths on Saturday. Officials stressed that it was too early to determine whether this was the beginning of a positive trend.
- This evening, Boris Johnson, the British Prime Minister, announced a nationwide lockdown, ordering all citizens to remain at home. People are only permitted to leave their houses for shopping for basic necessities, daily exercise, any medical need and travelling to and from essential work. The Prime Minister also banned any gatherings of more than two people and announced that the police would have the power to fine any violators. In addition, any shops selling non-essential goods have been ordered closed.
- Cyril Ramaphosa, the President of South Africa announced a 21-day national lockdown, ordering citizens to stay at home starting on Thursday except to access medical services and to do essential shopping. Groceries, pharmacies and other essential business will remain open. South Africa has reported 400 cases to date.
- The British government urged 1.5 million people in England with underlying health conditions to self-isolate for 12 weeks. Such people would be supported by government-funded “care parcels” and are advised not to leave their homes at all, even to go shopping.
- Germany continues to tighten restrictions, officially banning all non-family gatherings of more than two people, while some states have put in significant restrictions on when citizens can leave their homes.
- The Spanish president urged the European Union to set up a coordinated response to help Member States face the Covid-19 crisis, including creating a Marshall Plan aimed at launching a public investment plan for an economic recovery
- In Germany, the Federal Cabinet has approved an extensive aid package with a supplementary budget of 156 billion euros. The legislative branches will fast track the procedure and vote this week. The aid package includes aid to self-employed and to small businesses and 55 billion euros for the health care system to double the number of intensive care beds.
- The German government is forecasting an economic slump of five percent this year. And the Munich-based Ifo Institute predicts the crisis could cost Germany more than half a trillion euros and more than a million jobs. Depending on the scenario, the economy could shrink by 7.2 to 20.6 percentage points.
- Dutch chloroquine maker, Ace Pharmaceuticals, is under 24-hour police security. Chloroquine is an old malaria medicine that had a positive effect on a number of Covid-19 patients.
- In order to ease the pressure on the internet and amid an increase in usage during the ongoing COVID-19 crisis, Netflix and YouTube have announced that they will reduce streaming speeds/quality in Europe for 30 days.
BUSINESS RESPONSES TO CORONAVIRUS
Below are summaries of the most interesting business responses to COVID-19 in recent days. Weber Shandwick is proud to partner with each of these companies.
- Novartis will donate enough doses of malaria drug hydroxychloroquine to treat several million patients in the fight against the coronavirus, if it wins approval, the Swiss company said on Friday. “Novartis is supporting ongoing clinical trial efforts, and will evaluate needs for additional clinical trials,” it said in a statement. Click here for article.
- Nestle told employees to prepare for difficult times ahead and make all the necessary efforts to supply customers with the food and beverages they need, Chief Executive Mark Schneider said in a memorandum seen by Reuters. “This is the moment for extra effort, for going the extra mile,” Schneider said in a message to staff, distributed internally on Friday. “Please get ready for the storm to hit – because hit it will,” Schneider added. In his message, Schneider addressed frontline employees and factory workers in particular, saying their commitment and discipline were critical to maintain business continuity. Click here for article.
- Pernod Ricard North America began making hand sanitizer this week for the Federal Emergency Management Administration to aid in the coronavirus fight. Melissa Hanesworth, site director for the Fort Smith Pernod-Ricard facility, said a crew would make 4,000 gallons of the hand sanitizer for FEMA next week. Hanesworth said the process was cut from what would have been weeks to 72 hours. Click here for article.
- Aldi customers have been issued with a new set of rules for shopping there during the coronavirus outbreak. But rather than be taken aback, most have been singing the praises of the German supermarket, its staff, and its management. Aldi has been leading the way when it comes to supermarket responses to the growing threat caused by the coronavirus outbreak – and its latest move has drawn serious praise from shoppers. In a post on its Facebook page, Aldi wrote: “At a time like this, we need to work together. We’re doing all we can to make sure communities have what they need, but we need your help too – here’s how…” Click here for article.
- Honeywell will expand its personal protective equipment manufacturing operations in Smithfield, Rhode Island, and “produce millions of N95” protective masks. “We are honored to support the U.S. government’s efforts to protect Americans with personal protective equipment made right here in the United States,” said Darius Adamczyk, Honeywell chairman and chief executive officer. “Our Rhode Island facility already produces industry-leading safety gear and soon will play a critical role in supplying the Strategic National Stockpile with N95 masks.” Click here for article.
Hiring Increases as Unemployment Rises
- We continue to see coverage on job losses and paycheck cuts due to companies shutting down and cutting back on operations amidst the crisis. Despite this, top-tier outlets like The New York Times and CNBC have been reporting on how major companies are hiring thousands of workers to help meet the demand for critical products during this time. Types of companies hiring include retail and grocery stores, warehouses and food delivery chains. CVS plans to hire 50,000 workers across the U.S., while Walmart announced last week it plans to hire 150,000 additional employees through the end of May, roughly a 10% increase in its current workforce. Domino’s expects to hire 10,000 workers for full- and part-time positions to meet delivery demand.
- As noted last week, dozens of local newsrooms began laying people off this week out of fear that the economic hit of the coronavirus could severely impact their ad revenue, Sara Fischer and Margaret Harding McGill report. There have been major cuts at the Monterey County Weekly, Detroit Metro Times, Cleveland Scene, Orlando Weekly, San Antonio Current and others, per Nieman Lab. Some weeklies have suspended print publishing, including the Riverfront Times in St. Louis, Sacramento News & Review, Portland Mercury, The Stranger in Seattle and The Pulse in Chattanooga, Tennessee.
Company Shift in Factory Production
- In addition to a hiring increase, outlets have also began to report on shift in production. More and more companies have announced their decision to shift production to make medical equipment to ease shortages during the coronavirus pandemic.
- High-end fashion labels like Saint Laurent and Balenciaga will start making face masks to support the dwindling stocks of protective gear in France. Similarly, Gucci plans to produce and donate 1.1 million masks and 55,000 medical overalls to Italy.
- Automakers like General Motors and Tesla are devoting resources in attempt to tackle the shortage of ventilators, which are critically in treating COVID-19.
Continued Adjustment to Remote Work and Social Distancing
- Consumer media outlets continue to publish stories on tips for working remotely, how to adjust to social distancing and things to do at home.
- Lifestyle outlets are gradually shifting back to “normal coverage,” such as Refinery29 resuming its “Money Diaries” series. Celebrity-focused news outlets continue to report on celebrities testing positive and encouraging people to stay safe. However, there has been some articles coming out that are completely unrelated to the outbreak.
Changes in Storytelling and Broadcast News
- Advertising and marketing trades are still heavily focused on coronavirus-related news. Coverage primarily focuses on how brands and marketers are adapting to make smart, sensitive changes and finding the right tone for their campaigns.
- Fox Business Network plans to trim two more hours of its daily programming schedule, the latest in a series of maneuvers by news organizations amid an intense cycle related to the coronavirus outbreak. The network is moving its top host Lou Dobbs from 7 p.m. to 5 p.m., and suspending production on the network’s 5 a.m. show FBN: am, as well as Bulls & Bears, hosted by David Asman at 5 p.m.
- NBCUniversal has still taken a big step by announcing it is opening up MSNBC and CNBC to all cable subscribers, even those who don’t have the networks in their current cable packages.
- Hulu is now giving on-demand subscribers access to the free 24-hour ABC News Live streaming channel, in a bit of corporate synergy under their common parent, Disney.
INSIGHTS & INTEL: EMPLOYEE PERCEPTIONS ON EMPLOYERS’ RESPONSES TO COVID-19
Today, Weber Shandwick and KRC Research released new data on employee confidence in the face of COVID-19. We are conducting periodic national surveys of 1K+ American adults to gauge perspectives on coronavirus over time, with a focus on employed Americans.
The survey, Employee Perceptions on Employer Responses to COVID-19, catalogs responses over two points in time so far (March 4-6, 2020 vs. March 16-18, 2020). We found:
- Overall, more workers are confident that their employer will be able to handle an outbreak – and their confidence has increased over the past 10 days, from 60 percent to 73 percent.
- In fact, 77 percent believe their employer’s response to the coronavirus is exactly what it should be.
- The amount of workers who report their employer puts worker safety above profits increased from 54 percent to 79 percent.
- However, workers are nervous – half are concerned they will lose their job or income due to the coronavirus.
- More workers have received information from their employer about COVID-19 and its policies and actions related to it –increasing over the past 10 days, from 42 percent to 81 percent.
- In new questions in the March 16-18 survey, a large majority said they are taking precautions: 67 percent are staying home as much as possible and avoiding groups, 55 percent are practicing “social distancing,” 28 percent have cancelled or postponed personal travel, and 31 percent of the employed say they are working from home.
- Yet more than half (55 percent) continue to feel coronavirus fears are overblown – a slight increase from 49 percent 10 days earlier. Younger people (ages 18-44) are more likely to feel fears are overblown.
The full findings are available here.
We are continuing to see a steady pace of cancelled and postponed events scheduled to take place this year. While no major conferences were moved since our last update, there were 6 new cancellations and 14 postponements tracked. Many organizers for events later in the summer are still taking a “wait and see” approach, however we anticipate more events will be officially cancelled or postponed in the coming days/weeks.
Top news in event cancellations include:
- Summer Olympics: An IOC Member has reported the postponement of the Summer Olympics. Most likely rescheduled for 2021, details will be worked out within the coming weeks.
- NASCAR: Nascar held an IRacing simulator racing this weekend on FS1, as Nascar drivers competed from their own home video consoles in the virtual 100-lap race.
For more information about how we are helping clients solve in this uncertain time, please contact:
- Micho Spring, Chair, Global Corporate Practice, email@example.com
- Pam Jenkins, President, Global Public Affairs, firstname.lastname@example.org