The rapid worldwide spread of the coronavirus since it was first revealed in China less than three months ago has dealt an unparalleled shock to the global economy.
Following are weekend business developments related to the outbreak as governments attempt to stabilize their economies, companies navigate through an altered landscape, and millions of people face job losses and interrupted goods and services.
WORKER RESCUE: Airlines and retailers are pleading for aid as Congress and the White House continue to negotiate a rescue package. In a letter to U.S. House and Senate leaders Saturday, the CEOs of 10 airlines and cargo companies said they will be forced to take “draconian measures,” including laying off many of their 750,000 workers, if Congress doesn’t immediately approve at least $29 billion in payroll grants. The companies promised not to reduce employment through Aug. 31 if those grants are approved. Airlines are seeking a total of $58 billion in loans and direct grants; so far, the White House and Senate Republicans have offered up to $50 billion in loans but no grants. Airlines — cognizant of criticism — also promised to limit executive compensation and eliminate stock buybacks and dividends for a time if they are granted at least $29 billion in loans.
Also Saturday, the National Retail Federation, the nation’s largest retail trade group, sent a letter to the White House stating that retailers and their vendors are losing tens of billions of dollars every week due to the virus outbreak.
“As the nation’s largest private sector employer, supporting 52 million working Americans, retailers are committed to sustaining their workforces even if stores must close temporarily,” the letter said. The letter, which was also signed by 89 retail trade groups, urged policymakers to consider proposals that would provide sufficient liquidity for small, medium and large-scale businesses to remain viable until the end of the crisis.
RETAIL IS CURBED: Best Buy, the nation’s largest consumer electronics chain, is moving to curbside pickup service only as it tries to stop the spread of the coronavirus. Earlier this week, Best Buy had started to limit the number of people in its stores to only 10 to 15 at a time.
“We are seeing a surge in demand across the country for products that people need to work or learn from home, as well as those products that allow people to refrigerate or freeze food,” said Best Buy’s CEO Corie Barry in a statement. “As we meet the demand for these necessities, we are adjusting how we operate in many ways to improve safety.”
Best Buy has around 1,000 stores in the U.S.
Best Buy customers can still order online or on its app and have their products shipped directly to their homes. If a customer is unable to order online, Best Buy will send an employee into the store to retrieve an item.
The Minneapolis-based chain is joining thousands of other retailers not viewed as essential in temporarily closing its stores. Like many others, it’s also trying to preserve its business. It’s withdrawing its annual earnings guidance and is drawing the full amount of its $1.25 billion revolving credit line to shore up cash. Best Buy has also suspended all share repurchases, similar to such retailers as Kohl’s and Nordstrom.
(This item has been corrected to note that Best Buy is shifting to curbisde pickup service, not curbside delivery).
EMPLOYEE BONUSES: Grocery chain Kroger Co. joins a growing list of retail and restaurant chains offering special bonuses or sweetening benefits to workers. The grocery chain said that full-time hourly workers will receive a one-time special bonus of $300, while part-time workers will receive $150. Kroger has approximately 453,000 full- and part-time workers. The bonuses will be paid to workers who were hired on or before March 1. Kroger is also expanding its emergency leave guidelines to include paid time off for those workers in self-isolation or who have symptoms as verified by an accredited health care professional.
Target Corp. said Friday it will give a $2 an hour wage increase to its 300,000-plus workers who have been scrambling to help customers. The pay bump will be effective at least through May 2. It’s also begun offering workers who are pregnant, 65 years old or older, or who have underlying health risks, access to paid leave for up to 30 days. Amazon and Walmart are also offering extra incentives such as cash bonuses or a temporary wage bump as they try to manage the crush of customers while simultaneously looking to keep their workers happy.
Starbucks said it will pay its workers for the next 30 days, whether they come to work or stay home. The coffee chain also said it is temporarily closing access to its stores across the U.S., and reducing services to drive-thru and delivery only.
GOOGLE IT: Google has launched a new website and enhanced its search options for people seeking information about the new coronavirus, but the effort falls short of a plan initially announced by President Donald Trump. As of Saturday, when U.S. users typed in “coronavirus” or related terms, information about symptoms and links to state health departments and the U.S. Centers for Disease Control and Prevention popped up on the right. Google also unveiled a new website, http://www.google.com/covid19/, that links users to data, safety videos and relief efforts. Google said the website will soon be available in more languages and countries.
A little more than a week ago, Trump said Google would facilitate a website that would guide users through a series of questions to determine whether they should be screened for the virus. Then it would direct them to a local testing location.
In fact, a Google sibling company that focuses on health care confirmed it was working on such a site, but so far it is only available in certain counties in the San Francisco area.
Google also announced Friday that it would no longer hold its annual developer conference this year. The Google I/O conference was initially moved online, but the company said it has been canceled to comply with California’s “shelter in place” directives.