Daily Business Briefing
Aug. 3, 2021Updated
Aug. 3, 2021, 10:46 a.m. ET
Aug. 3, 2021, 10:46 a.m. ETCredit…Daniel Acker for The New York Times
Tyson Foods, one of the nation’s largest meat processors, said on Tuesday that it would require vaccines for its U.S. workers — about half of whom remain unvaccinated.
The mandate will extend to employees in its offices and in the field. The poultry supplier is requiring its leadership team to be vaccinated by Sept. 24 and the rest of its office workers by Oct. 1. Frontline employees have until Nov. 1 to be fully inoculated, extra time the company is providing because there are “significantly more frontline team members than office workers who still need to be vaccinated,” a Tyson spokesman said.
Tyson is offering $200 to frontline workers who verify that they are fully vaccinated. The company already offered employees up to four hours of pay if they are vaccinated outside of their normal shift.
Vaccinations will be a condition of employment for all U.S. workers, and any new employees must be vaccinated before they start work, the company said.
Tyson, which is based in Springdale, Ark., is still negotiating the matter with its unions, which represent about one third of its hourly work force.
“We did not take this decision lightly,” the company’s chief executive, Donnie King, wrote in a memo to employees announcing the news. “We have spent months encouraging our team members to get vaccinated — today, under half of our team members are.”
To date, more than 56,000 of Tyson’s U.S. 120,000 employees have been vaccinated. Tyson, which had about $43 billion in sales in 2020, is the largest meat and poultry processor in the United States, according to Statista.
Getting union leaders to sign off might be difficult. In an interview on Monday, before Tyson announced its mandate, the president of United Food and Commercial Workers union, which represents 24,000 Tyson employees in plants across the country, said he would not support employer mandates until the Food and Drug Administration approved the vaccine, which is currently being administered with an emergency authorization.
“You can’t just say accept the mandate or hit the door,’’ said Marc Perrone, the union’s president.
Companies, jolted by the Delta variant and eager for a return to normal, have announced a steady drumbeat of vaccine mandates for their employees over the past several weeks. But in the private sector, these requirements, which have come from Facebook, Google and Walmart and others, have so far largely focused on office workers rather than the more vulnerable frontline workers. Labor shortages that have affected industries including retail, restaurants and meatpacking have complicated the decision, which has been made more difficult by the economic divide separating those who have been vaccinated and those who have not.
The meatpacking industry has been hit hard by the coronavirus, given the close working conditions the job requires. And Tyson has come under fire for its lapses in safety standards, including allegations it failed to provide adequate safety equipment and refusing the requests of local officials to close a plant.
Tyson said Tuesday it had spent more than $700 million related the pandemic, including buying masks, face shields and providing on-site testing.
In the meatpacker’s home state of Arkansas, about 46 percent of the adult population is fully vaccinated. It has plants across the country, including in Georgia, Kansas, Missouri and Texas.
Read moreCredit…David Mcnew/Agence France-Presse — Getty Images
Activision Blizzard, the video game maker, said on Tuesday that the president of its Blizzard Entertainment studio was stepping down, a week after workers staged a walkout over allegations of harassment and discrimination.
Activision, known for Call of Duty and other popular gaming franchises, has been under intense pressure over the last couple of weeks following a lawsuit filed on July 20 in which California accused the company of fostering a “frat boy workplace culture” in which men joked about rape and women were routinely harassed and paid less than their male colleagues.
The departing executive, J. Allen Brack, will be replaced by two Blizzard executives, Jen Oneal and Mike Ybarra, who will be co-leaders of the studio, the company said in a statement.
“Both leaders are deeply committed to all of our employees; to the work ahead to ensure Blizzard is the safest, most welcoming workplace possible for women and people of any gender, ethnicity, sexual orientation or background; to upholding and reinforcing our values; and to rebuilding your trust,” Activision Blizzard said in a statement.
Ms. Oneal started at Blizzard in January as executive vice president of development, while Mr. Ybarra joined in 2019 as the executive vice president and general manager of platform and technology, Activision Blizzard said.
The video game industry has long been criticized for its toxic workplace environment toward women. In 2014, feminist critics of the industry faced death threats in what became known as Gamergate. Executives at the gaming companies Riot Games and Ubisoft have also been accused of misconduct.
Activision apologized last week for its reaction to the outcry from its workers, calling its initial response “tone deaf.”
“It is imperative that we acknowledge all perspectives and experiences, and respect the feelings of those who have been mistreated in any way,” the Activision Blizzard chief executive, Bobby Kotick, said in statement on July 27. “I am sorry that we did not provide the right empathy and understanding.”
This is a developing story. Check back for updates.
Read moreCredit…Aly Song/Reuters
China’s campaign to curb its tech industry shows no sign of slowing down, and many companies are on edge.
Not Alibaba. But that is partly because the e-commerce titan was among the first to feel Beijing’s heat.
Alibaba said on Tuesday that it was back in the black in the second quarter after a $2.8 billion antitrust fine led it to book a rare loss the quarter before. Profit for the three months that ended in June was $7 billion, the company said. Revenue was $31.9 billion, up 34 percent from a year earlier.
Beijing has taken aim at fast-growing companies in finance, music, education and other areas in a sweeping effort to rein in what it calls “disorderly” business conduct. In recent weeks, China’s leading ride-hailing company, Didi, has become perhaps the most prominent new target. Regulators pounced on Didi two days after the company went public on Wall Street in late June, citing data security and privacy concerns to order a halt to user sign-ups and app downloads.
Alibaba’s run-in with Beijing may be behind it. But it remains unclear how far the government’s campaign will go, and Alibaba executives did not miss the opportunity on Tuesday to express their support for regulators’ actions.
“We believe all these new regulations aim to foster the healthy development of the internet industry over the long run,” Daniel Zhang, the company’s chief executive, said during a conference call with analysts.
The company is trying to stay in Beijing’s good graces in more substantive ways as well. After it was fined in April for restricting the merchants on its shopping sites, executives vowed to spend heavily this year to lower those vendors’ costs. On Tuesday, the company said that this spending was partly responsible for causing operating profit to fall 11 percent in the latest quarter from a year earlier.
Read moreCredit…Associated Press
The Associated Press said on Tuesday that Daisy Veerasingham would become its new president and chief executive, the first woman and the first person of color to lead the 175-year-old news agency.
She will succeed Gary Pruitt, who is retiring at the end of the year after almost 10 years in the role. Her start date is Jan. 1.
“There is no doubt it’s a challenging media environment, and like many other media organizations, we’ve come under revenue pressure from time to time,” Ms. Veerasingham said in an interview. “So we really have to shore up our core business in media, but we also have got to work really hard to expand.”
Ms. Veerasingham, 51, joined The A.P. in 2004 as a sales director for its television news division in London. She was promoted to chief revenue officer in 2019 and became the company’s chief operating officer and executive vice president in February.
The A.P., which employs several thousand journalists reporting from 250 bureaus around the world, is interviewing candidates for executive editor, its top journalism job. Sally Buzbee left that post in May to succeed Martin Baron as the executive editor of The Washington Post.
“We’ve got really interesting candidates,” Ms. Veerasingham said, “and we would hope to be able to make an appointment within the next month or so.”
Mr. Pruitt said in a statement that he felt it was the right time “to pass the baton.”
“There is no better person to lead A.P. into its next chapter than Daisy, with whom I’ve worked closely over the past decade,” he said.
Read moreCredit…Mark Schiefelbein/Associated Press
Shares of Tencent Holdings and other prominent Chinese video-game companies plunged in Hong Kong trading on Tuesday after a Beijing-affiliated media outlet called their products “spiritual opium.”
The blast from the state-affiliated media outlet, the Economic Information Daily, came after months of increased pressure from Beijing aimed at the broader Chinese internet industry, which serves one billion users. That pressure has moved global investors to pull billions of dollars out of Chinese technology stocks, on fears that tighter regulation could hurt company prospects.
The article from the Economic Information Daily did not declare that any specific policy changes would be made, and it was unclear whether it reflected the views of Beijing officials or merely those of the publication’s editors.
Further adding to the uncertainty, the link to the article went dead later on Tuesday, though a copy could still be found on the site of Xinhua, the official state news agency, which controls the Economic Information Daily.
Despite the uncertainty, nervous investors were quick to sell shares.
Tencent, a technology conglomerate with a big presence in social media and entertainment in addition to video games, saw its shares drop about 10 percent at one point, though the losses moderated later on Tuesday and ended down about 7 percent. NetEase, another mainland video game company, saw its shares drop nearly 9 percent.
The article’s headline — “A ‘spiritual opium’ has grown into an industry worth hundreds of billions of dollars” — left little doubt at the thrust of the piece. It cited a litany of threats posed by video games, including diverting attention from school and family and causing nearsightedness.
“No industry or sport should develop at the price of destroying a generation,” it said.
The article singled out Tencent, which owns games popular in China like Honor of Kings as well as titles popular around the world, like League of Legends.
Tencent on Tuesday released a statement on its WeChat social media network describing some of the limits it recently decided to put into place, like limiting game time for minors and increased efforts to ferret out those who lie about their age to play.
The scrutiny isn’t new to Tencent or the industry. More than half of Chinese internet users play online games, according to government statistics. In the past, officials have worried that games could hurt children’s academics, damage their eyesight and reduce the country’s military readiness. In 2019, the authorities limited the amount of time young people could spend playing games online.
Read moreCredit…Phil Noble/Reuters
The global car market is rebounding strongly despite shortages of key components like semiconductors. That was the message Tuesday from German carmaker BMW and Stellantis, which owns Jeep, Peugeot and Fiat, as both reported large increases in profit.
BMW said it made a net profit of 4.8 billion euros, or $5.7 billion, in the second quarter of 2021 compared with a loss a year earlier, when the pandemic forced showrooms around the world to close. Sales soared 43 percent to 28.6 billion euros, driven by particularly strong increases in China and the United States, BMW said. Both sales and profit were higher than the same quarter in 2019, before the pandemic struck.
Stellantis, the product of a merger this year of Fiat Chrysler and the French maker of Peugeot and Citroën cars, reported a net profit for the first six months of 2021 of 5.9 billion euros, compared with a loss a year earlier, after sales rose 46 percent to 75 billion euros.
The Stellantis figures are based on a calculation of what the combined companies’ sales and earnings would have been in the first half of 2020, had the merger already taken place. Stellantis did not publish quarterly figures.
At the same time, both companies, which between them employ more than 400,000 people, warned that a global shortage of semiconductors is continuing to disrupt production.
Nicolas Peter, the chief financial officer of BMW, told reporters during a conference call that the chip famine could curtail production by as much as 90,000 vehicles this year.
That is on top of other risks, including further waves of the pandemic, higher prices for raw materials like steel, and extreme weather like the floods in western Germany last month that killed nearly 200 people. “Confronted with all these risks,” said Oliver Zipse, the chief executive of BMW, “the second half-year will be more challenging for the BMW Group than the first.”
Read moreCredit…Tristan Spinski for The New York Times
The scramble for temporary guest workers has been intense in recent years, as the jobless rate inched down and tensions over immigration policy ratcheted up. But this year, the competition has been particularly fierce.
To find out how the crunch has been affecting businesses — amusement parks, restaurants, camps and more — Patricia Cohen traveled to Salt Lake City, and Sydney Ember went to Portland, Maine.
Landscapers employ more H-2B workers than any other industry — roughly half of the total approved. Ken Doyle, the president of All States Landscaping in Draper, Utah, said the late arrival of 27 temporary foreign workers had cost him 15 to 20 percent of his business, about $1 million.
“We’re so far behind,” he said. “We’ve lost some very large accounts.”
Under the H-2B visa program, the number of seasonal foreign workers is ordinarily capped at 66,000 a year, split between the winter and summer season. Veteran workers, who returned year after year, used to be exempted from the total, but Congress halted that practice in 2017. The next year, the government instituted a lottery system that injected a new layer of uncertainty on top of a frustrating process.
Programs for temporary guest workers have long come under attack from several corners. Labor groups and immigration critics argue that it robs American workers of jobs and depresses wages. And every year, there are disturbing examples in which foreign workers are exploited by employers, cheated out of pay or living in squalid conditions.
Higher wages could encourage more American-born workers to apply for these jobs, said Muzaffar Chishti, director of the Migration Policy Institute at the New York University Law School. But he argues that in every labor market, there are difficult, unpleasant, low-paid jobs with no opportunity for advancement — like agricultural work or meatpacking — that are considered less desirable both for economic and for cultural reasons.
The Future of Transportation
Credit…Felix Schmitt for The New York TimesCredit…Felix Schmitt for The New York TimesCredit…Bob Miller for The New York Times
BP said Tuesday it would increase its dividend by 4 percent and bolster stock buybacks, joining Shell and other oil companies issuing improved quarterly earnings. The London-based energy company reported adjusted net income — what it calls underlying replacement cost profits — of $2.8 billion for the second quarter, compared with a loss of $6.7 billion in the period a year earlier, when many economies were in lockdown. The big improvement: Average oil prices for the quarter more than doubled since last year as the effects of the pandemic eased.
A hearing officer of the National Labor Relations Board has recommended that the board throw out a union election at an Amazon warehouse in Bessemer, Ala., where results announced in early April showed workers rejecting a union by a more than two-to-one ratio. The union announced the recommendation on Monday, and Amazon quickly said it would take steps to ensure that the original election result prevailed. The hearing officer’s recommendation will be reviewed by the acting regional director of the agency, who will issue a ruling on the case in the coming weeks. If the regional director rules against Amazon, the company can appeal to the labor board in Washington.
Christopher J. Waller, the Federal Reserve’s newest governor, said during an interview with CNBC on Monday that he would support slowing the Fed’s big bond purchases “early” and “fast,” and he indicated that he would have preferred to first slow purchases of mortgage-backed securities — something Jerome H. Powell, the Fed chair, more or less took off the table in comments last week. If the economy continues to add jobs rapidly — perhaps at a pace of 800,000 to 1 million jobs per month — he said he thinks the Fed needs to get moving. “In my view, with tapering, we should go early and go fast to make sure we’re in position to raise rates in 2022 if we have to,” Mr. Waller said. “You could taper in October; you don’t have to wait until January.”
The S&P 500 fell 0.2 percent in early trading Tuesday after the index ended slightly lower on Monday. The Nasdaq composite ticked down 0.3 percent on Tuesday.
The Stoxx Europe 600 was flat, and Asian markets were mixed.
Oil prices fell, with West Texas Intermediate, the U.S. crude benchmark, down 2.7 percent to $69.37 a barrel.
BMW fell about 5 percent while Stellantis, which owns Jeep, Peugeot and Fiat, rose about 5 percent. Both carmakers reported large increases in profit in their quarterly earnings report on Tuesday, but warned that a global shortage of semiconductors is continuing to disrupt production.
Credit…Stefani Reynolds for The New York Times
Treasury Secretary Janet L. Yellen will brief Speaker Nancy Pelosi and House Democrats on Tuesday morning about the struggling emergency rental assistance program as the Biden administration scrambles to keep people in their homes following the expiration of a temporary eviction moratorium.
The meeting comes as the White House is facing an uproar from progressive Democrats, who are faulting the administration for not finding a way to extend the eviction ban that the Centers for Disease Control and Prevention imposed last fall as a Covid-19 relief measure. The Biden administration has said that it lacks the legal authority to extend the moratorium and has called on Congress to find a legislative solution. On Monday, the administration called on states to ramp up their efforts to provide more federal aid to struggling renters.
In a letter to colleagues on Tuesday, Ms. Pelosi said she would discuss with Ms. Yellen how to expedite the disbursement of the $46.5 billion that Congress allocated to keep people in their homes.
“I am pleased that accelerating rental assistance is a stated priority of the administration,” Ms. Pelosi said.
But senior Democrats have been pushing the White House to do more.
“I wish that the president, the C.D.C. would have gone forward and extended the moratorium,” Representative Maxine Waters, Democrat of California who is chairwoman of the House Financial Services Committee, said in an interview with The New York Times on Monday. “They have the power to do that. I think he should have gone in and he should have done it, and let the chips fall where they may.”
With the moratorium in limbo, Ms. Yellen is under added pressure to make the rental assistance money flow. Only about $3 billion of the $46 billion had been delivered to eligible households through June, according to Treasury Department data.
In recent weeks, Ms. Yellen’s deputy, Wally Adeyemo, has visited Houston and Arlington, Va., where rental assistance distribution has been going well, to help raise awareness about the program and understand how to make it more effective.