4 possible explanations for the shocking decline in new jobs

help wanted
A “help wanted” sign hangs on a window of a restaurant on June 1, 2018 in Miami, Florida.

  • Experts don’t know exactly why April’s jobs report fell so short of expectations, adding just 266,000 jobs.
  • Possible reasons for the miss include too-generous unemployment benefits and temporary layoffs.
  • Experts say a labor shortage isn’t necessarily the main issue, and the news may not be as bad as it seems.
  • See more stories on Insider’s business page.

Economists thought that the economy would add a whole lot of jobs – about a million, to be exact – in April. Friday’s job reports turned that thinking upside down with a big surprise: The US economy added 266,000 jobs in April, falling significantly short of expectations.

In fact, unemployment even went up.

It’s a twist that left economists and economy journalists alike befuddled. It was especially shocking in light of March’s report showing a gain of about 900,000 jobs, and in a double whammy, the April report revised that figure down to 770,000. Also, the unemployment rate rose from 6% to 6.1%, while labor force participation actually climbed to 61.7% from 61.5%, signaling that more Americans are looking to return to work but also that more are getting classified as unemployed.

Insider previously reported on reasons that millions of Americans may be slow to return to work, like health concerns and the need to stay at home, but as results from Friday’s report found, but this dynamic rate hints it’s not as simple as a labor shortage. More workers seem to be joining the labor force – actively seeking out work – thereby bringing up the unemployment rate, but they also seem to be hesitating on taking new positions.

Of course, there’s no one explanation for why the jobs report fell so short, but it could be showing the nuances of what a post-pandemic recovery looks like, now that the economy has moved beyond March’s stimulus-powered gains and some of the lingering fissures are exposed. Separately, some economists have warned of the phenomenon called hysteresis, where the impact of a recession lingers in unemployment data after the events that caused it are gone.

Here are four reasons that might explain the jobs report disappointment:

(1) Unemployment benefits are too generous

Since the pandemic hit in 2020, Republicans and businesspeople have criticized expanded unemployment insurance – inserted into March 2020’s CARES Act by Democrats in the House – as too generous. Although the $600 federal unemployment addition to weekly benefits expired last year, it was soon reinstated at $300 per week, which President Joe Biden’s $1.9 trillion stimulus extended through September 6.

This jobs report is being seized upon as evidence that the benefits are still too generous. The US Chamber of Commerce has already called for their cancelation in the wake of the April jobs numbers.

Toby Malara, government affairs counsel at the American Staffing Association, told Insider in February that while unemployment has been “paramount” in helping people during the pandemic, it’s important to find a balance that doesn’t disincentivize people from returning to work.

Mercatus economist Michael D. Farren said in a statement that April’s jobs report might actually be better than it looks on the surface, and that while “changes to unemployment insurance probably are reducing labor supply, but workers’ primary inhibition to seeking employment is likely still COVID-19. But if the employment statistics next month look similar to April, Congress may need to take unemployment insurance back to the drawing board.”

Two states, South Carolina and Montana, have already moved to end additional pandemic unemployment benefits. Montana is opting instead to give workers a $1,200 back to work bonus, according to CNN.

But liberal economists – and the president – disagree with that assessment of UI. When asked at a Friday press briefing if enhanced UI bonus benefits were slowing down the return to work, President Joe Biden said: “No, nothing measurable.”

Later on Friday, Sen. Bernie Sanders wrote on Twitter that “We don’t need to end $300 a week in emergency unemployment benefits that workers desperately need. We need to end starvation wages in America. If $300 a week is preventing employers from hiring low-wage workers there’s a simple solution: Raise your wages. Pay decent benefits.”

(2) Women are being employed at lower rates

Overall, 165,000 women ages 20 and over left the labor force in April. Unemployment rates for Black and Latina women also remain elevated.

“If you added all of the women who’ve dropped out of the labor force since February 2020, the unemployment rate for women would be 8.1%, instead of 5.6%,” Jasmine Tucker, the director of research at the National Women’s Law Center, told Insider on Friday.

According to a Friday press release from the NWLC, it would take women 28 months to reach pre-pandemic – and that doesn’t account for potential population growth and more women graduating into the labor market.

Tucker said the April report underscores the need for more affordable and accessible childcare, as unemployed parents – especially mothers – contend with mixed reopenings and wanting to keep themselves and their families safe.

“While we’re reopening very expensive childcare centers, there’s going to be a mismatch there of who’s going to be able to afford to go back to work,” Tucker said.

(3) There are too many temporary layoffs

Counterintuitively, layoffs were unexpectedly high in the report, signaling companies are still struggling despite widespread evidence and expectations of an economic boom in 2021.

Approximately 2.1 million people said their pandemic unemployment was temporary in April.

That number is up from 2 million in March, both much higher than the 700,000 pre-crisis low and much lower than the pandemic-era peak of 18 million.

These temporary layoffs could make it harder for people to return to work, especially those with health concerns, that worry about getting sick should they choose to work again. This, accompanied by workers holding out for higher wages amidst large companies raising their minimum wages, could contribute to the poor jobs report.

(4) Seasonal adjustments could be off

Finally, a wonky explanation could account for some of the drop in job-gains data.

Seasonal adjustments measure and remove influences of seasonal patterns, like weather and holidays, to reveal how employment and unemployment change from month to month. Chris Rugaber, economy reporter for the Associated Press, flagged on Twitter that economists have noted potential seasonal adjustment issues: Non-seasonally adjusted jobs rose by about 1.1 million, showing that seasonally adjusting the data could be obscuring the true number of gains.

To be sure, this is still a difficult measure to parse right now. Seasonal adjustments typically follow a “more or less regular pattern each year,” per the BLS website, but 2020 and 2021 are far from typical years.

“You always have to take every data release with a grain of salt, and I think this one you have to take with a rock of salt,” Jan Hatzius, Goldman Sachs economist, told CNBC on Friday. But he still noted that the seasonally unadjusted number for the April report shows a gain of more than 1 million.

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Biden’s Labor Secretary insists April’s weak jobs gain of 266,000 ‘is a good number’

Boston Mayor Marty Walsh
Labor Sec. Marty Walsh.

  • The April jobs report fell far short of the 1 million growth expectation, adding just 266,000 jobs.
  • Labor Secretary Marty Walsh said he still thinks that 266,000 “is a good number.”
  • He said expanded federal unemployment insurance is still needed despite calls to end the benefits early.
  • See more stories on Insider’s business page.

The Friday jobs report was a major disappointment, as the US economy added just 266,000 jobs in April despite economists predicting a gain of at least 1 million.

But Labor Secretary Marty Walsh said on CNBC that this report should still be celebrated.

“I think as we continue to move forward here, hopefully in the coming months we are going to see lots of those Americans who are looking for jobs, finding jobs, and I’ll be able to stand in front of this camera and talk about the great gains we’ve had,” Walsh said. “But I still think 266,000 jobs this month is a good number.”

“If you look back on the last three months, the United States economy has added 500,000 new jobs per month as compared to the previous three months where it was 60,000,” Walsh said. So we are definitely going in the right direction but we still have a ways to go, there’s no question about it. We are still dealing with a pandemic.”

Insider’s Ben Winck reported on Friday that along with the disappointing job gains, the unemployment rate rose in April to 6.1% from 6%, while economists had expected it to drop to 5.8%. Possible reasons for the report falling short of expectations could include temporary layoffs and too-generous unemployment insurance.

The report highlights an increasing split between the weak jobs recovery and a booming economy led by consumer spending. For instance, US gross domestic product grew at an annualized rate of 6.4% in the first quarter – the second-strongest expansion since 2003. Insider’s Juliana Kaplan and Grace Kay reported on shortages of all sorts of items amid reopening, such as chicken and lumber, all evidence of a sudden increase in spending.

Walsh criticized the argument that unemployment benefits are to blame for the weak jobs report. He said people “obviously” need unemployment benefits given the millions of Americans who are still out of work.

At nearly the same time, the Chamber of Commerce urged an end to the $300 weekly benefits, with the chamber’s chief policy officer, Neal Bradley, saying in a statement that the “disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market.”

But Walsh remained adamant that retaining unemployment benefits is vital to economic recovery.

“We have lost restaurants. We have lost businesses,” Walsh said. “I wouldn’t say we are in the midst of pandemic … but we are still living and dealing with the pandemic, and as we continue to move forward here we will continue to recover.”

Walsh emphasized that as vaccinations continue, “we are starting to see the confidence come back.”

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Amazon was ranked by LinkedIn as the best place to grow your career. But the list omitted major factors like pay and race.

LinkedIn office
LinkedIn, which is owned by Microsoft, ranked Amazon as the best company for US workers to grow their careers in 2021.

  • Linkedin published its list of the top US companies for career growth, ranking Amazon first.
  • LinkedIn’s revamped criteria this year included factors like promotion rates and gender diversity.
  • But the list didn’t consider other key factors like pay and racial diversity.
  • See more stories on Insider’s business page.

In his final letter to shareholders as Amazon’s CEO earlier this month, Jeff Bezos downplayed concerns about the company’s working conditions, defending it as “Earth’s best employer and Earth’s safest place to work.”

The letter came on the heels of Amazon’s aggressive anti-union campaign, multiple illegal firings of whistleblowers, a tripling in the number of labor complaints against the company last year, and climbing injury rates that are nearly double the industry standard.

When Amazon announced its quarterly earnings call this week, it leaned on another source to prove that it’s a great place to work: LinkedIn. On Wednesday, the Microsoft-owned job platform published a list ranking “the 50 best workplaces to grow your career in the U.S.” in 2021.

According to LinkedIn’s criteria, Amazon earned the top spot, which the company touted in its earnings release along with high marks on lists by Fortune and Boston Consulting Group.

Amazon did not respond to a request for comment on this story.

LinkedIn did a massive overhaul of its criteria for this year’s list – which it explained in depth in an accompanying blog post – eventually landing on what it said were seven “pillars” that researchers have shown lead to career progression: “ability to advance; skills growth; company stability; external opportunity; company affinity; gender diversity and educational background.”

While any list claiming to rank the “top” anything is ultimately based on subjectively chosen criteria, several seemingly important factors didn’t make the cut, including salary data or any demographic data beyond gender.

LinkedIn confirmed salaries were not factored into the rankings but wouldn’t comment further about salaries on the record.

“In terms of the diversity pillars, we measure gender diversity, specifically, which looks at gender parity within a company, as well as educational background, analyzing the spread of educational attainment among employees. We are working on additional diversity criteria and hope to continue expanding this pillar in future years,” LinkedIn spokesperson Maggie Boezi told Insider in an email.

Amazon paid its median employee $29,007 last year, and the company said this week that it would raise pay by up to $3 per hour for 500,000 employees. But despite lucrative salaries and benefits for corporate employees, research has shown for years that Amazon setting up new warehouses often drives down wages in the area.

Those salary disparities take on added significance when factoring in the racial disparities between Amazon’s warehouse and corporate employees. In 2020, 32.1% of all Amazon employees were white, while 13.6% were Asian, 26.5% were Black, 22.8% were Latinx, 3.6% were multiracial, and 1.5% were Native American.

But the path upward is narrow for employees of color at Amazon.

Among corporate employees, 47% are white, while 34.8% were Asian, 7.2% were Black, 7.5% were Latinx, 3% were multiracial, and 0.5% were Native American. Among senior leadership, 70.7% were white, 20% were Asian, 3.8% were Black, 3.9% were Latinx, 1.4% were multiracial, and 0.2% were Native American.

LinkedIn’s decision to rank Amazon as the best place to grow your career without accounting for racial diversity data may be especially surprising to some members of Amazon’s diversity and inclusion teams, who told Recode that internal Amazon data showed that Black employees are promoted at a lower rate and given worse performance reviews than white coworkers.

Insider’s Allana Akhtar also reported that Amazon lags far behind competitors like Walmart – ranked ninth on LinkedIn’s list – when it comes to Black and Latino representation in upper management.

As for Amazon’s warehouse workers, Bloomberg reported in December that Amazon is “transforming the logistics industry from a career destination with the promise of middle-class wages into entry-level work that’s just a notch above being a burger flipper or convenience store cashier,” citing government data that showed more than 4,000 Amazon employees are on food stamps in just nine states.

Turnover rates at Amazon warehouses are estimated to be as high as 100%, according to the National Employment Law Project.

One possible explanation for why LinkedIn’s list still ranked Amazon first despite the above data may be that its list appeared to focus on white-collar workers.

In her blog post explaining the methodology, LinkedIn senior managing editor Laura Lorenzetti, said that the list “since its inception showed professionals where people like them were most eager to work.”

Boezi, the LinkedIn spokesperson, told Insider that the list included all full-time and part-time employees regardless of job title – except freelancers and interns – and that LinkedIn “regressed our findings against outside sources such as the World Bank and the Bureau of Labor Statistics, and evaluated various scoring mechanisms for every pillar we selected.”

While LinkedIn’s list may not single-handedly change jobseekers’ minds, Amazon’s case reveals how the underlying data that goes into such rankings is far from unbiased.

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US labor board to hold hearing on whether to redo Amazon union election based on evidence submitted by union

amazon rwdsu BESSEMER, AL - MARCH 29: An RWDSU union rep holds a sign outside the Amazon fulfillment warehouse at the center of a unionization drive on March 29, 2021 in Bessemer, Alabama. Employees at the fulfillment center are currently voting on whether to form a union, a decision that could have national repercussions. (Photo by Elijah Nouvelage/Getty Images)
Amazon workers in Bessemer, Alabama, voted against forming a union, but the Retail Wholesale and Department Store Union, under which they would have unionized, challenged the results.

  • The National Labor Relations Board will hold a hearing on whether to redo the Amazon union vote in Bessemer, Alabama.
  • Amazon employees there voted against unionizing, but the Retail, Wholesale and Department Store Union challenged the results.
  • The NLRB said the union’s evidence warranted a hearing to consider whether Amazon acted illegally and whether a new election should be held.
  • Amazon has denied any wrongdoing.
  • See more stories on Insider’s business page.

The National Labor Relations Board on Wednesday said evidence submitted by the Retail Wholesale and Department Store Union concerning Amazon’s conduct during a union vote in Bessemer, Alabama, justified holding a hearing to review the evidence and determine whether to redo the election.

“The evidence submitted by the union in support of its objections could be grounds for overturning the election if introduced at a hearing,” the NLRB said.

The NLRB’s ruling clears the way for a hearing, which it plans to hold on May 7, where it will review the RWDSU’s evidence. If the NLRB finds Amazon illegally interfered in the election, it can void the results and re-run the election.

Amazon has denied any wrongdoing.

The RWDSU, the union which Amazon’s employees voted on whether to join, failed to secure enough votes from Amazon warehouse workers to form a union in a highly publicized election earlier this month.

When the NLRB publicly announced the vote count on April 9, the tally was 1,798 votes against unionizing and 738 votes for the union, with 505 ballots challenged and 76 ballots voided – 70.9% of valid votes counted were against the union.

But the RWDSU subsequently filed 23 objections against Amazon and how it acted during the contentious March election, claiming Amazon’s conduct prevented employees from having a “free and uncoerced exercise of choice” on which way to vote. The RWDSU alleged Amazon’s agents unlawfully threatened employees with closure of the warehouse if they joined the union and that the company emailed a warning it would lay off 75% of the proposed bargaining unit because of the union.

An Amazon spokesperson did not immediately respond to a request for comment on the NLRB’s statement.

At the May 7 hearing, the NLRB would have the option to overturn the election results if any evidence of illegal action is ruled credible.

(Reuters reporting by Nandita Bose in Washington; Editing by Chris Reese)

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Union objects to Amazon election and accuses the company of threatening layoffs ahead of the vote. Amazon says it followed all laws.

Amazon Bessemer warehouse
Amazon’s warehouse in Bessemer.

  • The union that Amazon workers voted against joining in Bessemer, AL, filed objections against Amazon.
  • The union vote in Bessemer failed to pass, with over 70% of valid ballots voting against unionizing.
  • Amazon said the union is “misrepresenting the facts.”
  • See more stories on Insider’s business page.

After Amazon warehouse workers in Bessemer, Alabama voted against forming a union, the Retail, Wholesale, and Department Store Union has filed 23 objections to Amazon’s conduct during the voting period.

The union said the objections merit an investigation and it is seeking to toss out the result of the union vote. Amazon has said it followed all laws in its communication with workers on the union effort.

The RWDSU is the union that would have represented Amazon workers if the vote had passed. At the close of the vote count on April 9, the valid votes were overwhelmingly against joining the union, with 70.9% voting no. The final vote count was 1,798 votes against forming a union and 738 votes for forming a union, with 505 challenged ballots and 76 voided ballots.

In its filing to the National Labor Relations Board, the RWDSU accused Amazon of threatening to close its facility or lay off workers if they voted to form a union. The RWDSU also accused Amazon of intimidating workers and alleged that Amazon “terminated a Union supporter for passing out union authorization cards in non-working areas.”

Amazon said the RWDSU is “misrepresenting the facts.”

“The fact is that less than 16% of employees at BHM1 voted to join a union,” an Amazon spokesperson told Insider in a statement. “Rather than accepting these employees’ choice, the union seems determined to continue misrepresenting the facts in order to drive its own agenda. We look forward to the next steps in the legal process.”

In filing the objections, the RWDSU is asking the NLRB to schedule a hearing to determine if Amazon “created an atmosphere of confusion, coercion, and/or fear of reprisals.”

The next step in the objection procedure is for the NLRB to review the objections. If the objections are found to be credible, the NLRB will issue a formal complaint. The objections would then be examined at a hearing, unless Amazon and the RWDSU were to reach a settlement.

It is common for unions to file similar objections in the wake of failed union elections. In fact, such charges are filed in 41.5% of all union election campaigns, according to the Economic Policy Institute. EPI did not track how many of these charges that the National Labor Relations Board ultimately found to be merited, resulting in further investigation.

Amazon previously told Insider in a statement that “it’s easy to predict the union will say that Amazon won this election because we intimidated employees, but that’s not true.” The company stressed that “employees made the choice to vote against joining a union.”

In his final letter to shareholders as CEO, Jeff Bezos addressed the Bessemer vote, saying he didn’t “take comfort” in the outcome.

“I think we need to do a better job for our employees,” he said. “While the voting results were lopsided and our direct relationship with employees is strong, it’s clear to me that we need a better vision for how we create value for employees – a vision for their success.”

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Amazon’s AI-powered cameras are a double-edged sword that could make drivers safer, but also force the company to sacrifice productivity, a transportation expert says

GettyImages 1232149494 UNITED STATES - APRIL 6: Amazon driver Shawndu Stackhouse delivers packages in Northeast Washington, D.C., on Tuesday, April 6, 2021. (Photo By Tom Williams/CQ-Roll Call, Inc via Getty Images)
Amazon’s drivers must meet demanding productivity quotas as high as 300 packages per day, which drivers say require them to cut corners.

Amazon recently installed AI-powered surveillance cameras in its delivery trucks that monitor drivers’ behavior in what the company says is an effort to reduce risky driving behaviors and collisions.

Whether the cameras ultimately accomplish that goal may depend on how much productivity Amazon is willing to sacrifice in order to keep drivers safe, according to a transportation expert who studies AI-powered safety systems.

Amazon’s cameras, which are made by a startup called Netradyne, record 100% of the time that the vehicle’s ignition is on, tracking workers’ hand movements and even facial expressions and audibly alerting them in real-time when the AI detects what it suspects is distracted or risky driving.

Almost immediately, drivers pushed back – and one even resigned, according to the Thomson Reuters Foundation – citing concerns about the cameras eliminating virtually any privacy they once had, as well as potentially making them less productive.

Several drivers told Insider’s Avery Hartmans and Kate Taylor they’re worried about Amazon penalizing them for using their phones on the job, even though they need the devices for navigation. Others said the additional safety precautions they’re taking to avoid committing infractions, like stopping twice at an intersection or driving slower, are making it hard to keep up with the company’s notoriously demanding delivery quotas, which can run as high 300 packages per day.

But that’s exactly the trade-off Amazon may be forced to make, Matt Camden, a senior research associate at the Virginia Tech Transportation Institute, told Insider.

“If a fleet wants to reduce risky driving behaviors, it’s critical to look at why the drivers are doing that in the first place, and usually, it’s because there’s other consequences that are driving that behavior,” such as “unrealistic delivery times,” Camden said.

“They want to keep their job. If they miss their delivery time, that’s going to look bad – they could be fired, they could lose their livelihood,” he said. “And if [the delivery time] is unrealistic, then they have to find a way to get it done.”

Instead, Camden said, companies like Amazon need to approach technology-based safety systems “from a more positive standpoint, from a training standpoint and say: ‘We’re not going to nitpick you. We just want you to be safe.'”

“Netradyne cameras are used to help keep drivers and the communities where we deliver safe,” Amazon spokesperson Alexandra Miller told Insider in a statement.

“Don’t believe the self-interested critics who claim these cameras are intended for anything other than safety,” she added.

Netradyne could not be reached for comment.

Safety first

Miller told Insider in Amazon’s pilot test of the Netradyne cameras from April to October 2020, accidents decreased 48%, stop-sign violations decreased 20%, driving without a seatbelt decreased 60%, and distracted driving decreased 45%.

However, independent research on the Netradyne “Driveri” camera system Amazon uses, and AI camera systems generally, is more sparse.

In an informational video for its camera rollout, Amazon claimed “the camera systems” can “reduce collisions by 1/3 through in-cab warnings,” citing studies by an investment bank called First Analysis as well as VTTI, where Camden works. (First Analysis could not be reached for comment).

Amazon didn’t respond to questions about which studies it was referring to in the video.

Camden said VTTI hasn’t looked at Netradyne’s cameras specifically, but that a study it conducted in 2010 found “video-based monitoring systems” without real-time alerts or AI prevented between 38.1% and 52.2% of “safety-related events” when tested on two different company’s delivery fleets.

But those safety benefits were a result of funneling data from the cameras to safety managers, who could then give feedback to drivers to help them drive safer.

“We can’t say that these AI-powered cameras would reduce 10%, 20%, 30%, 50% [of safety incidents],” Camden said. “We can’t get that specific number yet because we haven’t done the research, but it makes sense that in-vehicle alerts do work to address risky driving,'” Camden said.

Similar technologies do show promise, he said, citing VTTI research that showed real-time lane-departure warnings reducing crashes by more than 45%.

But Camden also said when VTTI did a study last year looking at why some delivery fleets are safer than others, it ultimately came down to which ones had a strong “safety culture” and were “prioritizing and valuing safety, at least on the equal level as productivity, if not higher.”

“The safest ones typically said: ‘If you’re tired, we don’t care if you miss your delivery, we want you to stop. We want you to take a break. If you have to go to the bathroom, we want you to stop and go to the bathroom. We don’t want you to feel pressured to keep going.'”

Camden said those fleets made it clear that drivers could reject unrealistic delivery times and wouldn’t be penalized if the route took longer because of traffic or construction.

“It’s easier said than done, of course, because productivity is driving the business. They have to make money, they have to keep their customers happy,” he said.

“But really, it comes down to creating the policies and the programs to support safety, support the driver, because we don’t want them speeding. We don’t want the drivers cutting corners to try to make a delivery.”

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Fed Chair Jerome Powell says the greatest risk to the US economic rebound is another wave of the coronavirus

FILE PHOTO: U.S. Federal Reserve Chairman Jerome Powell speaks to reporters after the Federal Reserve cut interest rates in an emergency move designed to shield the world's largest economy from the impact of the coronavirus,  in Washington, U.S., March 3, 2020. REUTERS/Kevin Lamarque
U.S. Federal Reserve Chairman Jerome Powell  speaks in Washington

  • The US economy is about to start growing “much more quickly,” Federal Reserve Chairman Jerome Powell told CBS.
  • The biggest risk to the economic recovery is another surge in coronavirus cases, Powell said.
  • He credited steady vaccinations, stimulus, and strong monetary policy for the rebounding economy.
  • See more stories on Insider’s business page.

Federal Reserve Chairman Jerome Powell says the US economy is about to start growing “much more quickly,” but a resurgence in COVID-19 cases could derail that progress.

Powell discussed the US economic recovery from the coronavirus pandemic with CBS’ Scott Pelley, in an interview set to be aired on 60 Minutes Sunday at 7 pm ET.

In a preview of the interview, Powell said the US economy is at an “inflection point” more than a year after the virus forced widespread lockdowns, tangling supply chains, shuttering businesses, and leaving millions of Americans unemployed.

Powell said the economy is picking up steam “because of widespread vaccination and strong fiscal support, strong monetary policy support.”

“We feel like we’re at a place where the economy’s about to start growing much more quickly and job creation coming in much more quickly. The principal risk to our economy right now really is that the disease would spread again. It’s going to be smart if people can continue to socially distance and wear masks,” Powell told CBS.

The March jobs report showed positive signs, adding 916,000 nonfarm payrolls, well-exceeding economists’ expectations. The unemployment rate fell to 6% from 6.2%, matching forecasts, still far above the 3.5% pre-pandemic rate.

While businesses reopen and hiring appears to be surging, many employers have said they are struggling to fill vacant jobs, especially in the restaurant and retail sectors, which took a huge hit last year.

Powell earlier this month said some people may struggle to reacclimate to an economy permanently changed by the pandemic, adding the Fed will continue to provide support to prevent scarring and persistent unemployment.

“The real concern is that longer-term unemployment can allow people’s skills to atrophy, their connections to the labor market to dwindle, and they have a hard time getting back to work,” he said in the conference. “It’s important to remember we are not going back to the same economy, this will be a different economy,” Powell said in a virtual conference hosted by the International Monetary Fund.

Powell and experts have also cautioned that another wave of the coronavirus could unwind economic progress.

Even as vaccinations continue to roll out in the US at a steady pace, confirmed cases of COVID-19 in the US have again been on the rise. The director of the Centers for Disease Control and Prevention last month warned of “impending doom” and a possible fourth surge of the virus, spurred by variants.

On Saturday, an Israeli study found coronavirus variants first found in South Africa and the UK are able to partially “breakthrough” the Pfizer/BioNTech vaccine. The study has not yet been peer-reviewed.

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Amazon’s victory against a union drive in Alabama proved workers want better workplaces, but America’s labor laws are too broken to help them get that, experts say

alabama amazon warehouse unionization 2x1
Amazon faces a historic union vote in Alabama.

After one of the most high-profile union – and anti-union – campaigns in recent history, Amazon employees in Bessemer, Alabama, voted overwhelmingly against unionizing, with the National Labor Relations Board confirming Friday that 71% of eligible ballots were cast in opposition.

But eight labor experts told Insider that focusing on the vote tally misses the bigger takeaway from this saga: that American workers are demanding better workplaces and a voice on the job, and America’s current labor laws simply aren’t designed to help them accomplish that goal.

Still, they said, Bessemer put a spotlight on how stacked the deck is against workers, and that the broad, diverse public support for the union drive showed the US labor movement is gaining more steam than it has in decades.

Amazon, which had aggressively opposed the union effort, undoubtedly won a significant battle this week (pending likely legal challenges from the Retail, Wholesale and Department Store Union). But it may have put a target on its back that could prove costly in what’s likely to be an ongoing war over how companies treat their workers, the experts said.

The fight was never going to be fair

Amazon responded to the vote Friday by saying its “employees made the choice to vote against joining a union” and that it was glad their “collective voices were finally heard.”

But experts said that misrepresents what has happened since November, when Bessemer employees officially asked the NLRB to hold a union election.

“The result reflects the imbalance in current US labor law, rather than any genuine expression of whether workers would like to have more of a voice in their workplace,” Rebecca Givan, an associate labor and employment professor at Rutgers University, told Insider.

“This demonstrates just how hard it is for workers to gain a voice on the job when the employer has unlimited resources, full access to workers all day long, and very few legal constraints on what it can do or say,” she said.

Over the past several decades, American executives and politicians have chipped away at labor laws and workers’ right to organize, experts said. At the same time, companies have kept American workers’ pay and benefits down, and shipped jobs overseas where labor is cheaper – even as workers’ productivity, as well as corporate profits and executive pay, have soared.

In European counties, like France, where labor laws more heavily favor workers, some Amazon employees have been able to successfully unionize. That has paid dividends: in July, Amazon gave its French employees a 1.6% permanent raise following union negotiations.

In Bessemer, workers had a much tougher road to travel.

“Unions lose in 90% of the cases when management opposes the organizing effort,” which Amazon’s management did, Tom Kochan, a professor of management at MIT, told Insider.

That’s depite a surge in pro-union sentiment in the US in recent years. Kochan’s research in 2017 found that around 48% of non-union workers would join one if they had the opportunity, while a Gallup poll from August found that 65% of Americans approve of unions – the highest percentage in nearly 20 years.

But under US labor law, companies have lots of tools at their disposal to try to prevent employees from unionizing, from forcing them to listen to anti-union messaging in “captive-audience” meetings, to having a significant say over which employees are eligible to unionize in the first place. Even when companies violate those laws, the NLRB, which oversees union elections, lacks the power to issue fines, which experts said gives companies little incentive to play fair.

“The most important story is not the fact that the union didn’t win. Rather, it’s that they got as close to winning as they did,” Erin Hatton, an associate professor of sociology at the University of Buffalo whose research focuses on work and labor movements, told Insider.

“Through legal coercion and illegal tactics, employers spend a great deal of money to keep unions out and it usually works. So this outcome isn’t all that surprising. And yet the workers were incredibly successful in so many ways,” she said.

Anti-union tactics in the spotlight

One of those successes, experts said, was bringing attention to Amazon’s industry-standard, but still aggressively anti-union tactics.

“Amazon’s tactics during the campaign and voting process were successful for them but now are being questioned legally and in the public view,” Lynne Vincent, an assistant professor of management at Syracuse University, told Insider.

Even before employees started talking about forming a union, Amazon had hired private detectives known for union busting, spied on workers’ private Facebook groups, and tracked unionization risk with a heat map tool in an effort to thwart organizing efforts before they gained momentum.

Amazon also illegally fired multiple employees last year who organized demonstrations to shed light on what they said were unsafe and grueling working conditions, the NLRB found. Amazon previously said it disagreed with the board’s findings in one case, while the other case is still pending before an NLRB administrative law judge.

Once employees took their union drive public, Amazon enlisted expensive “union avoidance” consultants to help kick its union-busting tactics into overdrive. Amazon pushed its anti-union message through websites, t-shirts, frequent texts to employees, and midnight “education” meetings, which labor experts told Insider were fairly typically in union campaigns like this.

Amazon’s executives and PR team also waged an atypical attack on members of Congress who voiced support for the unions (Amazon later apologized for some of its tweets), and deployed an army of warehouse employees to respond to criticism of the company on social media.

But the company also sought to shape the voting process itself.

The NLRB has allowed mail-in voting in union elections since March 2020 due to the pandemic, but Amazon (twice, unsuccessfully) tried to get the NLRB to hold an in-person election. When that failed, it reportedly pressed the United States Postal Service to install a mailbox outside the Bessemer warehouse.

An Amazon spokesperson previously told Insider that the USPS installed the mailbox “for the convenience of our employees.”

But the Retail, Wholesale and Department Store Union – under which Amazon’s Bessemer employees would have unionized if the vote had passed – accused Amazon of using the mailbox to intimidate workers and plans to file unfair labor practices charges with the NLRB that, if serious enough, could cause the NLRB to throw out the election result.

John Logan, a labor and employment professor at San Francisco State University who specializes in companies’ union avoidance strategies, told Insider that the mailbox’s placement likely gave employees an impression that “Amazon was playing some kind of direct role in monitoring and even perhaps in counting the votes, which clearly creates an atmosphere of pressure and potentially unlawful intimidation.”

Vincent said that companies who use a similar anti-union playbook to Amazon “may see validation in the effectiveness of the tactics,” but that the Bessemer campaign may also cause politicians to reexamine and ultimately outlaw some of those tactics.

What’s next for American workers?

Kochan said the Bessemer union drive was “another clear indication that [US] labor law is broken, perhaps in its current form, beyond repair.”

But many of the experts who spoke to Insider said the massive amount of attention and public support it generated suggest there may finally be an appetite to begin those repairs.

Under the Trump administration, the NLRB “systematically rolled back workers’ rights,” according to an analysis by the left-leaning Economic Policy Institute. President Joe Biden has already signaled he intends to be much more pro-worker than his predecessor, releasing a video in support of unionization efforts and against corporate “anti-union propaganda” – as Amazon employees were voting.

“Given the pro union sentiment in many areas, as well as the clear backing of the current administration, it would still not be surprising to see successful efforts to unionize businesses in other areas, and eventually, even at Amazon itself,” Joseph Seiner, a labor and employment law professor at the University of South Carolina, told Insider.

Lawmakers on both sides of the aisle, from Republican Sen. Marco Rubio to Democratic Rep. Alexandria Ocasio-Cortez, voiced support for the Amazon employees’ push to unionize. The House also passed the Protecting the Right to Organize (PRO) Act, which would make it easier for workers to organize, harder for employers to misclassify workers, and ban certain union-busting tactics – though the bill faces steep odds in the Senate.

Veena Dubal, a law professor at UC Hastings who researches how technology impacts workers’ lives, said that the Bessemer vote may push regulators to look more closely at how giant tech firms like Amazon exert power over workers.

“A lot of regulatory focus has hinged on anti-trust regulation-the need to break up Amazon because of its significant market power-but the truth is, Amazon also exerts monopsony power in labor markets. In areas where Amazon warehouses exist, wages go down, not up,” Dubal said.

The COVID-19 pandemic and racial justice protests following George Floyd’s death last May have also forced Americans to reckon with how race plays a role in the workplace. That became a focus in Bessemer, where the RWDSU estimated that 85% of Amazon’s employees are Black, according to The New York Times.

“The core issue in the campaign was not about specific concessions but worker power. And in this case, it can’t be distinguished from the struggle for racial equity,” Premilla Nadasen, an associate professor of history at Barnard College who researches alternative labor movements, told Insider. “Black people are being disenfranchised electorally and subject to systemic violence. So, the struggle for economic control over matters more.”

“Official union membership figures aside,” she said, “more and more working-class Americans are recognizing the need to have a collective voice.”

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Votes against Amazon union lead after first day of ballot counting

Amazon union RWDSU vote Bessember Alabama warehouse
Union organizers Syrena (R) and Steve (no last names given) wave to cars exiting an Amazon fulfillment center on March 27, 2021 in Bessemer, Alabama.

  • The NLRB has paused its counting of Amazon employees’ votes over whether to unionize.
  • As of Thursday evening, votes against unionizing led by a margin of 1,100 to 463.
  • The NLRB expects to resume counting the votes Friday, but the results will likely be challenged.
  • See more stories on Insider’s business page.

Votes against forming a union at an Amazon warehouse in Bessemer, Alabama, lead by a more than 2-1 margin after the first day of counting ballots.

The National Labor Relations Board paused its public counting of Amazon employees’ ballots shortly after 7 p.m. Eastern Time on Thursday with the anti-union votes leading 1,100 to 463.

The NLRB plans to resume counting ballots again on Friday morning at 9:30 a.m. Eastern Time.

While the remaining ballots are likely to be counted Friday, it could take the NLRB several weeks to announce the official outcome of the vote due to likely challenges from the Retail, Wholesale and Department Store Union – the labor group under which Amazon’s Bessemer employees would unionize if the vote passes.

“Our system is broken, Amazon took full advantage of that, and we will be calling on the labor board to hold Amazon accountable for its illegal and egregious behavior during the campaign. But make no mistake about it; this still represents an important moment for working people and their voices will be heard,” RWDSU President Stuart Appelbaum told Insider in a statement.

Amazon did not immediately respond to a request for comment on this story.

Per NLRB rules for union votes, both Amazon and the RWDSU can file objections within five days of the conclusion of the count. The NLRB then decides whether the objections are serious enough to warrant a hearing where it will determine whether the vote results should be set aside.

The Washington Post reported Thursday that Amazon pushed the United States Postal Service to install a mailbox outside the Bessemer warehouse at the start of the voting period in February, which the RWDSU previously argued violates labor laws by intimidating workers and implying Amazon plays a role in collecting and counting ballots.

“This mailbox – which only the USPS had access to – was a simple, secure, and completely optional way to make it easy for employees to vote, no more and no less,” Amazon spokeswoman Heather Knox told The Post.

Before Thursday’s public vote count, both Amazon and the RWDSU also had the opportunity to challenge employees’ eligibility to cast a ballot. Hundreds of ballots were challenged, mostly by Amazon, according to the RWDSU, which could potentially impact the outcome as well.

This year Amazon appealed to change the NLRB’s practices. In February, Insider reported that the NLRB had denied Amazon’s request to conduct an in-person union election, saying that the company must allow mail-in voting. And after the close of voting on March 29, the NLRB denied a request by Amazon for increased surveillance on the room where ballots were stored in the labor board’s Birmingham, Alabama, headquarters.

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A former Google engineer said she endured a year of harassment. She’s now vowing to ‘never love a job again.’

Google logo office Mountain View
Google’s logo seen at its Mountain View campus.

  • Ex-Google engineer Emi Nietfeld said she endured harassment and retaliation while working there.
  • In an op-ed for The New York Times, she said Google’s response led her to vow to “never love a job again.”
  • Multiple current and former Googlers have accused the company of discrimination.
  • See more stories on Insider’s business page.

Workers have long coveted jobs in the tech industry because companies promise things like good pay, prestige, luxurious perks, and innovative cultures.

But Emi Nietfeld, a Google engineer from 2015 to 2019, wrote in an op-ed for The New York Times on Wednesday that she left her tech job because Google’s supposed reputation as a great place to work masked the reality that – just like other companies – it ultimately looks out for itself.

Nietfeld said in the op-ed that one her male managers sexually harassed for more than a year, calling her “beautiful,” “gorgeous,” and “my queen” – and that Google’s reputation made it that much harder to speak up.

“Saying anything about his behavior meant challenging the story we told ourselves about Google being so special,” Nietfeld wrote, adding: “Google was the Garden of Eden; I lived in fear of being cast out.”

Google did not respond to a request for comment on this story.

When she eventually filed a formal HR complaint, Nietfeld wrote: “Google went from being a great workplace to being any other company.”

Google ignored Nietfeld’s concerns about having to sit next to her harasser during and after its three-month-long investigation, even after concluding that he violated the company’s harassment policy, she said, while suggesting that Nietfeld seek counseling, work remotely, or take a leave of absence.

It’s not the first time Google has come under fire over similar cultural and equity issues.

Multiple former Google employees said that the company told them to take mental health leave when they experienced sexism and racism. Oher employees and shareholders have filed lawsuits accusing Google of gender pay bias, retaliation against whistleblowers, and mishandling major sexual harassment incidents involving top executives.

Nietfeld said Google didn’t appear to do much in the way of reprimanding her harasser, and after suffering through weeks of bad sleep and emotional distress at work, she took three months of paid leave. But Nietfeld said she returned only to face retaliation from another manager, get passed over for promotion, have her pay cut, and have Google make a “meager counteroffer” when two competing job offers came up.

“After I quit, I promised myself to never love a job again. Not in the way I loved Google. Not with the devotion businesses wish to inspire when they provide for employees’ most basic needs like food and health care and belonging. No publicly traded company is a family. I fell for the fantasy that it could be,” Nietfeld wrote.

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