Fully endorsed
The F.D.A. granted full approval to the Pfizer-BioNTech coronavirus shots for people 16 and older yesterday, the fastest vaccine approval in the agency’s history. (Although, perhaps, not fast enough.) President Biden seized on the moment. “If you’re a business leader, a nonprofit leader, a state or local leader, who has been waiting for full F.D.A. approval to require vaccinations, I call on you now to do that,” he said. “Require it.”
It gives companies more cover to impose vaccine mandates and industry groups more ground to lobby local authorities. Some states have moved to outlaw vaccine mandates. Arizona’s governor, for example, issued an order outlawing coronavirus vaccination as a requirement for employment. Those actions made it difficult for companies with large national footprints to impose blanket mandates. While some have pushed back, like Norwegian Cruise Line in Florida, most have stayed out of the fray.
“Many companies have made the decision to mandate vaccines for some or all of their employees, and we applaud their decision,” the Business Roundtable said in a statement. “We also encourage policymakers, including at the state and local levels, to support — not impede — companies’ ability to make such a decision.”
More public sector employers are introducing mandates, easing the way for private employers to make similar moves. New York City said it would require all 148,000 employees of the city’s Education Department to be vaccinated. The Pentagon is demanding that its 1.4 million service members receive the shot by the middle of next month.
Some of the latest corporate mandates:
Chevron is mandating vaccines for expats and for employees who travel internationally, as well as for the offshore work force in the Gulf of Mexico and for some onshore support personnel.
CVS Health says its pharmacists have until Nov. 30 to be fully vaccinated, while others who interact with patients, and all corporate staff, have until Oct. 31. The mandate covers about 100,000 employees.
Disney World said unions representing more than 30,000 employees had agreed to a mandate, citing the F.D.A.’s full approval, that would require workers to be vaccinated by Oct. 22.
Mandates may be the only way to significantly increase vaccination rates, given continued hesitancy about the shot. A recent poll found that three out of 10 unvaccinated people said that they would be more likely to get a fully approved F.D.A. shot, though some experts believe that this figure could be exaggerated.
More regulatory action is coming. Moderna’s application for full approval of its vaccine was filed in June, a month after Pfizer. Johnson & Johnson is expected to apply for full approval soon. And the F.D.A. is also weighing whether to authorize booster shots for the fully vaccinated, another twist for corporate vaccine mandates.
HERE’S WHAT’S HAPPENING
House leaders delay a vote on Biden’s budget priorities. Plans for a vote yesterday on a $3.5 trillion budget blueprint were scrapped, as centrist Democrats demanded that the $1 trillion bipartisan infrastructure plan was approved first. Wall Street analysts are telling clients to prepare for both measures to pass — eventually.
Commodity prices are moderating, reducing inflation concerns. The decline in iron, oil, copper and other commodities from recent highs gives the Fed and other policymakers more room to operate. That is helping the Biden administration make the case that its spending plans won’t push inflation higher.
The S.E.C. issues new requirements for Chinese companies listing in the U.S. Some Chinese companies have reportedly begun receiving requests for more detailed disclosures about their use of offshore vehicles in I.P.O.s. That follows a recent call from Gary Gensler, the S.E.C. chairman, for a “pause” in Chinese listings on U.S. exchanges.
Walmart begins delivering goods for other retailers. The new service, Walmart GoLocal, is an effort to leverage the retail giant’s reach and to diversify its revenue streams. It will also make Walmart look more like its biggest online rival, Amazon.
A Korean law challenges the White House’s policy on Big Tech. Apple and Google are asking the U.S. government for help fighting a law in South Korea that the companies say would unfairly harm their app stores. The law, expected to face a crucial vote this week, is a test for the Biden administration, which must balance defending American companies’ interests abroad with its push to rein in their power at home.
Checking in on hedge fund performance
Hedge funds have trailed the market for many months. Part of the reason is that their favorite stocks, as measured by a Goldman Sachs index of the most heavily owned shares, have risen just 4 percent in the past six months, versus 16 percent for the S&P 500.
Hedge funds were caught off guard by Beijing’s corporate crackdown. Asian stocks, especially ones exposed to China’s rapidly growing economy, have long been favorites of hedge funds, which search for higher-than-average returns to justify their higher-than-average fees. But Beijing’s recent crackdown on its largest tech companies, particularly those with U.S. listings, has hit those bets hard.
Goldman says that about a third of the funds it surveys had an investment in foreign-listed shares of Chinese companies at the end of June, the highest percentage it has ever measured. Alibaba, a top holding of many hedge funds, has slumped nearly 30 percent since the end of June.
Aug. 24, 2021, 7:58 a.m. ET
Hedge funds also doubled-down on pandemic plays, loading up on investments in companies that benefited from pandemic lockdowns but underperformed recently as the economy reopened.
For instance, hedge funds collectively own more shares in Amazon than they did a year ago, according to Bank of America. Peloton also recently became one of the stocks most widely held by hedge funds.
The outlook: With Covid cases on the rise, however, betting on another pandemic-related slowdown or on a return to more strict social distancing looks smarter by the day. And Chinese shares have fallen so far that bargain hunters are jumping in, lifting stocks from historic lows in recent trading. What’s more, the biggest hedge funds don’t appear to have any trouble raising money as investors keep the faith that their strategies will pay off whatever the prevailing market conditions.
“There was already a higher bar before Theranos because we don’t fit the pattern. This just makes it that much harder.”
— Falon Fatemi, co-founder of the tech companies Fireside and Node, on how the collapse of Theranos, the blood-testing start-up led by Elizabeth Holmes, has made it harder for firms led by women to attract investors.
The gig economy hits a glitch
A California judge on Friday ruled that a law in the state classifying many gig workers as independent contractors, known as Prop. 22, was unconstitutional and unenforceable. Here are answers to questions you may have about the decision. (You can find more detailed explanations here.)
Understand Vaccine and Mask Mandates in the U.S.
- Vaccine rules. On Aug. 23, the Food and Drug Administration granted full approval to Pfizer-BioNTech’s coronavirus vaccine for people 16 and up, paving the way for an increase in mandates in both the public and private sectors. Private companies have been increasingly mandating vaccines for employees. Such mandates are legally allowed and have been upheld in court challenges.
- Mask rules. The Centers for Disease Control and Prevention in July recommended that all Americans, regardless of vaccination status, wear masks in indoor public places within areas experiencing outbreaks, a reversal of the guidance it offered in May. See where the C.D.C. guidance would apply, and where states have instituted their own mask policies. The battle over masks has become contentious in some states, with some local leaders defying state bans.
- College and universities. More than 400 colleges and universities are requiring students to be vaccinated against Covid-19. Almost all are in states that voted for President Biden.
- Schools. Both California and New York City have introduced vaccine mandates for education staff. A survey released in August found that many American parents of school-age children are opposed to mandated vaccines for students, but were more supportive of mask mandates for students, teachers and staff members who do not have their shots.
- Hospitals and medical centers. Many hospitals and major health systems are requiring employees to get a Covid-19 vaccine, citing rising caseloads fueled by the Delta variant and stubbornly low vaccination rates in their communities, even within their work force.
- New York City. Proof of vaccination is required of workers and customers for indoor dining, gyms, performances and other indoor situations, although enforcement does not begin until Sept. 13. Teachers and other education workers in the city’s vast school system will need to have at least one vaccine dose by Sept. 27, without the option of weekly testing. City hospital workers must also get a vaccine or be subjected to weekly testing. Similar rules are in place for New York State employees.
- At the federal level. The Pentagon announced that it would seek to make coronavirus vaccinations mandatory for the country’s 1.3 million active-duty troops “no later” than the middle of September. President Biden announced that all civilian federal employees would have to be vaccinated against the coronavirus or submit to regular testing, social distancing, mask requirements and restrictions on most travel.
Why did the judge find Prop. 22 unconstitutional?
Prop. 22 carved gig workers out of the pool of employees eligible for compensation in the event of an injury or other workplace incident. But California’s Constitution gives the state legislature authority to create and enforce a workers’ compensation system. The judge wrote in his decision that Prop. 22 “limits the power of a future legislature to define app-based drivers as workers subject to workers’ compensation law” and was therefore unconstitutional.
Who intervened to block the proposition?
Three ride-hail drivers and one rider are involved in the lawsuit, along with the Service Employees International Union.
Who is on the other side?
Although the lawsuit focuses on how app-based companies treat their workers, a coalition of drivers and labor groups is suing the state of California and the Department of Industrial Relations, which administers workers’ compensation. The gig economy companies’ coalition, Protect App-Based Drivers and Services, is a respondent in the suit.
What’s next?
The attorney general of California or Protect App-Based Drivers and Services can file an appeal. Even an expedited appeal could take several months. For now, gig economy companies might be required to begin paying into workers’ compensation funds — but the companies argue that nothing will change until the appeal is resolved. The shares of Lyft and Uber rose yesterday as investors bet that the effect might not be as severe as feared.
Pining for the office
The pandemic has converted many to remote work, and for all the employees who prefer hybrid or fully virtual setups, there are also many who can’t wait to get back to the office full-time. With each delay of return-to-office dates, that group is growing more frustrated.
Most people want a workplace outside of their home. Advocates for remote work might be particularly vocal right now, but a national survey of more than 950 workers, conducted in mid-August by Morning Consult on behalf of The Times, found that 45 percent of the employees questioned said that they wanted to be at a workplace or an office full-time. Around 30 percent wanted to work remotely full-time, with the rest preferring a hybrid approach.
Who wants to go back? Social butterflies, people with crowded or noisy homes and new hires are among those who yearn for offices to reopen. “If we don’t get a really solid foundation at this company in our first six months, our first year, what foot does that leave us on for the rest of our time at the company?” said David Pantera, whose orientation process at Google will be held online next month.
Some are reaching the end of their tether. For many, being forced to set up offices in their kitchens, living rooms or bedrooms has eroded important barriers between work and home life, increased a sense of isolation and led to burnout, said Tsedal Neeley, a Harvard Business School professor who has studied remote work for decades.
THE SPEED READ
Deals
Virgin Orbit is going public in a SPAC, with Boeing among the investors, in a deal that values it at $3.2 billion. (TechCrunch)
Vox Media is acquiring Punch, a drinking culture website, as it weighs a SPAC merger or I.P.O. (WSJ)
European companies are going public in the U.S. at the fastest pace in 20 years. (Bloomberg)
Policy
Jay Powell’s highly anticipated Jackson Hole speech this week comes as Fed officials are more worried about inflation than they have been in years. (WSJ)
The C.E.O.s of Amazon, Apple, Google, JPMorgan Chase and Microsoft are among those invited to the White House tomorrow for talks on cybersecurity. (Bloomberg)
The Taliban named Mohammad Idris, a largely unknown figure, as acting governor of Afghanistan’s central bank as inflation spirals, cash runs short and a financial crisis looms. (Al Jazeera)
Best of the rest
Experts warn that a shortage of shipping vessels could last years. (FT)
Brian Chesky, Airbnb’s C.E.O., said that the company would pay to house 20,000 Afghan refugees around the world. (NYT)
“Luxury’s Gray Market Is Emerging From the Shadows” (NYT)
A group of Apple employees started AppleToo, a site aiming to expose any instances of racism, sexism and discrimination at the company. (The Verge)
How three small businesses maintained their office culture when few of their employees were actually in the office. (NYT)
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