Boeing posts third annual loss in a row as Dreamliner prices hit $5.5 billion

Boeing a major milestone in its year-long 737 Max crisis deliveries jump helped generate cash in the fourth quarter for the first time in almost three years.

But now the company is facing mounting spending on its 787 Dreamliner program, which on Wednesday revealed $5.5 billion in costs related to manufacturing defects that have prevented Boeing from making these new ones over the past 15 months Handing over jets to customers.

Shares of the company fell more than 5% in afternoon trade, more than the broader market.

The manufacturer took a pre-tax charge of $3.5 billion for the Dreamliner in the fourth quarter. It expects an additional $2 billion in costs after cutting production of the planes, double its previous estimate.

“We can’t rush it”

Boeing first disclosed the flaws – tiny, improper clearances on some fuselages – in 2020. Defects were also found in other parts of some aircraft, and Boeing had to inspect the undelivered jets.

“While I don’t like any of the allegations, the progress has been significant,” CEO Dave Calhoun told CNBC.screeching in the streeton Wednesday about the 787. He declined to say when he expects regulators to grant approval and deliveries to resume. “We can’t rush it.”

Boeing reported free cash flow of $494 million for the fourth quarter, up from an outflow of $4.27 billion a year earlier, a milestone Boeing executives previously said they wouldn’t hit until 2022. It was spurred by a surge in 737 Max deliveries last year after regulators lifted bans on the jets following fatal crashes in 2018 and 2019.

China

China, a key customer for Boeing and the first country to ground the Max after the second crash, the last month was approaching lift its ban in the planes.

CFO Brian West told analysts on the quarterly conference call that shipments to China could resume “as early as the first quarter” of 2022, which could help the company generate more cash.

Here’s how Boeing compared to analyst estimates prepared by Refinitiv:

  • Adjusted Results: A loss of $7.69 per share versus an expected loss of 42 cents per share.
  • Revenue: $14.79 billion versus $16.59 billion expected.

Boeing lost $4.29 billion last year, its third consecutive annual loss Covid pandemic and production problems continued to affect the bottom line. That’s an improvement from 2020, when the company had a loss of $11.94 billion.

For the fourth quarter, Boeing reported a net loss of $4.16 billion, less than half the $8.44 billion it lost a year earlier. Revenue fell 3% year over year to $14.79 billion, down from $16.59 billion that analysts had expected.

‘renovation year’

“2021 was an important recovery year for us, and together we overcame significant hurdles,” Calhoun said in a note to employees on Wednesday. “While we still have work to do, I am confident that we are well positioned to accelerate our progress in 2022 and beyond.”

Chicago-based Boeing aircraft sales and deliveries increased last year, but deliveries of new planes to airlines still lagged behind European rival Airbus. The US company said it has increased production of the 737 Max to 26 a month, closer to the 31 a month it expects this year and up from the 19 a month it released in its last quarterly report.

But Boeing has been paralyzed for months by halting deliveries of its 787 Dreamliners for much of the past year due to a series of manufacturing defects that have left customers baffled American Airlines and Hawaiian Airlines.

American Airlines said last month it would be cutting its international flight schedule over 787 delivery delays. The airline’s CFO, Derek Kerr, said in an earnings call last week that Boeing is already paying penalties for the delays and “will compensate us for the losses” if there are more delays.

More delays

Kerr had said American expects to start deliveries of the Dreamliner again in mid-April, a timeframe Boeing CEO Calhoun did not confirm on Wednesday. “All I’m saying is that customers know everything we do,” Calhoun said, adding that airlines and Boeing “share the same regulator.”

“The company continues to perform follow-up work on 787 aircraft in inventory and is in detailed discussions with the FAA on the actions needed to resume deliveries,” Boeing said in a earnings release. “In the fourth quarter, the Company determined that these activities will take longer than previously anticipated, which will result in further delays in customer delivery dates and related customer considerations.”

CFO West referred to labor, material and supply chain shortages as “observation posts.”

Boeing’s large fleet of aircraft — 335 Max jets expected to be delivered by the end of 2023 — will provide a buffer, Calhoun said.

“When I think about the supply chain constraints that are out there, I hate that we got here this way, but having a stock of finished aircraft, particularly in relation to the Max, is at this moment beneficial,” Calhoun told CNBC.

recovery from travel

Calhoun said he expects the worst is behind the aviation sector after the pandemic crushed demand for air travel and new planes. Airline executives said in early January they expect international travel bookings to rebound this spring and summer after entry restrictions were lifted in recent months.

The company reiterated on Wednesday that it expects passenger traffic to return to 2019 levels next year or 2024.

Suppliers to Boeing and Airbus General Electric on Tuesday forecast a 20% increase in sales this year at its main aerospace division, which manufactures and repairs aircraft engines.

However, the recovery was bumpy. airlines incl delta, United and American earlier this month predicted the rapid spread of the Omicron variant, which began late last year delay a rebound travel demand by about two months. Executives at those airlines said they expect a strong spring and summer travel season.

On Tuesday, the Transportation Security Administration screened 1.06 million people, the fewest since April 2021.

Omicron wave reveals early indicators of easing in states hit early

A woman receives a Covid-19 test during a drive through the Covid-19 Testing Center as hundreds of cars and pedestrians queue to check out a Covid ahead of the Christmas holiday in North Bergen, New Jersey, the United States, December 22, 2021 -19 test as Omicron levels up across the land.

Tayfun Coskun | Anadolu Agency | Getty Images

After weeks of rising infections, the latest Covid surge is showing signs of slowing in a handful of areas earliest affected by the Omicron variant – offering a glimmer of hope that this wave is beginning to wane.

The U.S. has been reporting an average of nearly 800,000 cases a day for the past week, more than triple the previous record set last winter, according to data from Johns Hopkins University. But in a handful of states and cities, particularly on the East Coast, cases appear to have plateaued or been declining in recent days.

In New York, the seven-day average of daily new cases has declined since hitting a record high of 85,000 a day on Jan. 9, according to Hopkins. Cases there doubled over a series of seven-day periods in late December and early January, but have fallen sharply to an average of 51,500 since last week. In New York City, average daily cases have fallen 31% over the past week, data from the state Health Department shows.

“There will come a time when we can say it’s all over,” Gov. Kathy Hochul said at a news conference on Friday. “We’re not there yet but boy is it coming and we’ve been waiting a long time.”

New York is still reporting high levels of daily infections and ranks 15th among all states, down from the second-highest a few days ago, according to a CNBC analysis of population-adjusted case counts. New Jersey also recently fell out of the top five and is now 20th as the state saw a 32% drop in average daily cases over the past week.

At the end of December, Washington, DC had the highest number of Covid infections per capita than any other state, peaking at an average of 2,500 per day. That has since fallen to 1,700, the data shows.

And in neighboring Maryland, daily infections hit a pandemic high on Jan. 8 but are down 27% from a week ago.

In Illinois, said Dr. Khalilah Gates, associate dean of medical education at Northwestern University’s Feinberg School of Medicine, said the stabilization in hospitalizations is “already kind of being felt.” On Sunday, the state reported a seven-day average of about 7,200 patients hospitalized with Covid, a 4% increase from the past week, a more modest increase than the 30% weekly growth reported, according to the Health Department was only observed two weeks ago.

“There’s not that influx that we had at the beginning of the climb and things are just a little bit around,” she said. “And if that goes on for five to seven straight days, I think you start to breathe a little easier and say, OK, like we kind of got through that climb, got through that climb too.”

Cases are also declining in South Africa and the UK, which are being closely watched as potential clues to what could be happening in the US, as they have both experienced previous spikes. Hopkins data shows average daily infections in South Africa are down 80% from where they peaked on December 17 and in the UK by 42% from that country’s peak on January 5, although there’s no guarantee the US will will follow the same path.

American populations have different vaccination rates, previous exposure to the virus, and levels of underlying health conditions, so Omicron’s trajectory could vary.

Certainly, cases are rising in most states, with 23 reporting record-high infection rates as of Sunday, data from Hopkins shows. And yet, U.S. cases are undercounted due to the availability of at-home testing kits, the results of which are not typically reported to state or federal agencies.

That increase is particularly visible in western states, where average daily cases are showing some signs of slowing but are still up 14% over the past week. This has led to a “jumping up” in Covid admissions at Providence St. Joseph Medical Center in Los Angeles, Dr. Michael Daignault on CNBC Worldwide exchange Friday morning.

“We had this delta rise, it was a rise and then a plateau, and then the Omicron kind of lifted off this delta crest,” said Daignault, an emergency room physician at the hospital.

Caused the increase New Jersey Gov. Phil Murphy on Tuesday and Washington Gov. Jay Inslee on Thursday to issue emergency orders to combat the new wave of cases.

A steep peak

Experts predict the Omicron wave will fall almost as fast as it has risen, leaving the US with relatively few Covid cases sometime in February or March, although cities are likely to reach that point sooner.

While the threat of a new variant could always change projections, it’s possible Americans could see some breathing space as a large segment of the population retains some immunity to the recent infection.

“Sometime in early March, mid-March, we should be in a very good position,” said Ali Mokdad, professor of health metrics at the University of Washington’s Institute for Health Metrics and Evaluation. “April, May, we will have reported very few cases.”

However, how quickly cases drop after they have peaked depends on a community’s adherence to public health measures after that period.

“It depends on how high the peak is. And whether people, when they see case numbers going down, kind of ease things up,” said Aubree Gordon, associate professor of epidemiology at the University of Michigan School of Public Health.

hospitals overwhelmed

There is a growing body of evidence that the Omicron variant makes people more contagious, but not as sick as the Delta variant.

Still, there is a record 156,000 Americans in US hospitals with Covid, according to a seven-day moving average of HHS data, up 17% over the past week. A significant proportion of Covid hospitalizations appear to be from people admitted for other reasons who test positive for the virus once in a facility.

Miami Mayor Francis Suarez told CNBC: “screeching in the streetlast week that about half of the city’s hospital admissions are people who were diagnosed after being admitted for something else. NY Governor Hochul on Sunday reported that 42% of hospitalized Covid patients in New York were admitted for something other than the virus.

Even if the omicron variant causes less severe diseases, the hospitals can still be burdened due to the high patient volume in combination staff shortage.

“The rate-limiting factors are still the incredible speed of this variant, the number of patients who come into the ER or require an admission,” said Daignault, the LA physician. “And even if we do peak in late January, you still have the back end of that spike for the rest of February.”

Daignault suspects that many of the intensive care patients at his hospital are currently suffering from the more virulent Delta variant. Delta cases could also contribute to a spike in LA’s daily Covid deaths, he said. Still, the CDC recently estimated omicron now accounts for 95% of new cases.

Nationwide, cases and hospitalizations have passed the peak of last winter, but there are about 87% as many patients in intensive care with Covid. The US is reporting a seven-day average of nearly 1,800 Covid deaths a day, according to Hopkins data, which, while rising, is about half the peaks recorded around this time last year, before vaccines were widely available.

While vaccines, particularly without a booster dose, appear to offer less protection against infection by Omicron, they appear to withstand the serious illnesses and deaths that they were originally designed to prevent. While this means that vaccinated people may be contributing to the rise in cases, in reality it is the unvaccinated who are driving hospital admissions.

But the high transmissibility means many healthcare workers have contracted the virus and are being forced to isolate, pushing some hospitals to their limits even sooner.

Although a peak in cases provides some light at the end of the tunnel of this surge, hospitalizations and deaths have lagged the rise in infections. The full impact of the Omicron spike remains to be seen.

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WATCH: Signs Covid is peaking in the North East

Retailers see staffing challenges as omicron rages, gross sales taking a success

A sign saying “Now Hiring” is posted in an Urban Outfitters store in San Francisco.

David Paul Morris | Bloomberg | Getty Images

Retail executives presenting at the ICR virtual conference this week explain how the highly contagious Omicron variant drives sales and leaves stores and distribution centers understaffed.

But investors seem to be shrugging the bad news as they see it as a short-term challenge. For many retailers, the silver lining is that consumer demand appears to be well intact.

Lululemon said sales will be in the November-January quarter are at the lower end of their previous expectations because working hours had to be reduced at some locations due to a lack of labor. Lands’ End said it had been a difficult time hiring. Abercrombie & Fitch lowers its sales estimate for the fourth quarter because it didn’t have enough goods in stock to meet consumer demand. While Urban Outfitters said shoppers’ visits to its stores had not increased as planned in December, and were instead purchased on its websites.

Still, Abercrombie shares rose nearly 8% on Tuesday lunchtime, while its rival American Eagle Outfitter increased by about 3%. Urban Outfitters ‘stock rose nearly 2% and Lands’ End rose a little over 2%.

And these are just a few examples of how the recent surge in Covid cases in the US is sure to continue to rock the retail sector in the coming weeks. On Monday, around 1.5 million new cases of Covid-19 have been reported, according to data from Johns Hopkins University, bringing the seven-day average of new cases to 754,000 daily. While many vaccinated people infected with the virus say symptoms are mild, hospital admissions are on the rise, especially for those who get sick and are not fully vaccinated.

While these retailers may be weeks away from releasing full Christmas quarter results, the revised forecasts and comments provide analysts and investors with a preview of what’s to come. Companies from Lululemon to American Eagle are also shedding light on how to deal with the effects of omicron.

Work overtime

Lands’ End chief financial officer Jim Gooch said Tuesday that some employees had been working overtime in the past few weeks.

“We know that the work will be a big problem. … We hope this will normalize in the future, but this year has been a challenge,” he said during an ICR presentation. “And that’s why the teams are doing what they can to try to come out on top this year.”

Abercrombie & Fitch said Tuesday it was able to drag workers from one of its brands into stores of another brand in order to keep the doors open when workers call in sick. The company also owns Hollister and Gilly Hicks.

“In a mall where we have multiple brands and we have a staffing problem because we have a store that might come into contact with Covid, we can borrow staff from the other stores and that has helped us tremendously,” said Abercrombie Chief Executive Fran Horowitz, during an ICR presentation.

As a result, Horowitz said, Abercrombie has not had to close any stores entirely due to Covid outbreaks. However, it has temporarily reduced opening hours in some locations, she said. That’s an approach that companies take off Macys to gap to Nike also recently took.

“A little déjà vu”

“The first day of ICR 2022 was a little déjà-vu where we all sat in front of our computers and went from meeting to meeting with one click,” said Dana Telsey, CEO and Chief Research Officer at Telsey Advisory Group.

“Unfortunately, the Omicron variant of Covid-19 appears to have the negative impact we all feared on sales and staffing levels in January,” she said in a statement to customers.

Urban Outfitters reported Tuesday that sales for the two-month period ended December 31st were up 14.6% compared to 2019. Digital sales grew double-digit during this period, while in-store sales declined a low double-digit percentage on a two-year basis, the company said.

“We believe omicron affects our store sales … It’s hard to say how much,” said CFO Melanie Marein-Efron during an ICR presentation. “As soon as your stores start restricting their hours of operation, you are clearly limiting the ability of consumers to get into your store.”

American Eagle, which also owns lingerie brand Aerie, predicts fourth-quarter sales will increase a medium-to-high percentage of teenagers year over year. According to refinitive data, this is less than the 21.5% increase forecast by analysts.

However, American Eagle raised its expectations for sales in 2023 from $ 5.5 billion to $ 5.8 billion, suggesting the effects of Covid will be temporary.

“We think it will be short-term if there is any impact, and more isolated in January … maybe into February,” said Mike Mathias, CFO of American Eagle, when asked about omicron. “We share resources as needed between tips in specific stores.”

Pacers hit reset button with “coaching camp” type observe

INDIANAPOLIS – After dipping 113-104 in the heat at Gainbridge Fieldhouse on Friday, arguably their worst loss of the season, the Pacers had a day off on Saturday before heading to work on Sunday for a camp-style session returned.

Malcolm Brogdon, who faced his team’s fourth consecutive loss with 14 points on 4-of-14, said it was good for his squad to have some time to hit the reset button before then he will host the wizards on Monday.

“I thought we had a great training session (Sunday),” said Brogdon. “It was honestly like a training camp. We worked hard (Sunday) and I think that’s what we needed. We just have to come out and play man. We have to play at a high level with desperation.”

So what exactly does a mid-season camp exercise involve?

“Real work on the fundamentals, real conditioning work, real hard game work, real skill development work,” said Indiana trainer Rick Carlisle. “The schedule these days is such that those quality training days aren’t nearly as frequent as they were in the old days of the (Eastern Conference) Central Division, where there were many consecutive times, but they were short” trips “in a row. And then they would make a lot of two day breaks that you can have a day off, a quality day of practice, and then a game. But everyone adapts to the reality of today’s game and that’s just one of those opportunities we have to seize. “

This is only the second time this season the Pacers have had two days off between games and the first time that has happened at home. The other time Indiana had a two-day break was during a four-game road trip on the west coast last month.

Kelan Martin, who was still training at the team’s training facility on Saturday, said it felt good to wake up in his own bed.

“I usually come in on my days off and work a bit, just try to be consistent with my game, but calm helps,” said Martin. “Above all, to be at home and not in a hotel, but actually to be at home and enjoy it.”

Martin averages 5.3 points while shooting 40.9% off the field and 1 out of 10 to 3 points during Indiana’s steak lost four games. The former butler star remains confident about his game and team, noting that the 9-16 Pacers “know how well we can play”.

Carlisle has said on numerous occasions that his team lacks “strength”, which has resulted in some disappointing performances. Brogdon believes the problem has more to do with focus than exertion.

“I think it’s more about getting into the details of the game and being more physical in defense,” said Brogdon. “To be honest, we’re a team that plays hard. It’s not that we don’t play hard out here. So anyone who says that is wrong. It’s literally about the details, to know your people. That’s what matters to us. ” . “

Domantas Sabonis, who had 14 points and 16 rebounds against the Heat, agreed with Brogdon that the solution to the Pacers’ problems is not simply to play harder. However, he did admit that his team “look dead out there” sometimes when reviewing feature films.

After an intense workout at Ascension St. Vincent Center on Sunday, Sabonis said Indiana plans to carry that energy across the street to Gainbridge Fieldhouse on Monday.

“Our record doesn’t show how we feel about (losing),” said Sabonis. “It definitely sucks, but we feel like we’re there, we can compete with anyone, we can win these games. But we just can’t do it. It’s a difficult task. We’re trying to get better out here and improve and try to turn the page. “

Follow IndyStar Pacer’s beat writer James Boyd on Twitter: @RomeovilleKid. Contact him by email: jboyd1@gannett.com.

South African rand takes hit on new Covid fears, variant

South African rand.

RapidEye | iStock | Getty Images

The South African rand fell sharply against the dollar on Friday after a new variant with many mutations was discovered in the country.

The currency fell as low as 16.2391 against the greenback during Friday’s Asian session and was last trading 1.6% weaker at 16.2215 per dollar.

The losses came as investors turned to safe-haven currencies like that Japanese YEN, which is up about 0.6% against the greenback to 114.69 per dollar. The USA Dollar indextracking the greenback versus its peers was at 96.712 – compared to levels below 96.5 seen earlier this week.

World Health Organization officials said Thursday They are monitoring a new variant with numerous mutations in the spike protein – the part of the virus that binds to body cells. The health authority is planning a special meeting for Friday to discuss what this can mean for vaccines and treatments.

According to the WHO, the variant with the designation B.1.1.529 was found in small numbers in South Africa.

“We don’t know much about it yet. What we do know is that this variant has a large number of mutations. “Dr. Maria Van Kerkhove, WHO technical director on Covid-19, said in a question-and-answer session that was broadcast live on the organization’s social media channels.

Hours after the announcement, the UK announced that it would Temporarily suspend flights from six African countries.

– CNBC’s Hannah Miao contributed to this report.

World Covid deaths hit 5 million as pandemic takes staggering toll

Two women walk next to graves of people who died due to coronavirus disease (COVID-19) in the Parque Taruma cemetery in Manaus, Brazil, on May 20, 2021.

Bruno Kelly | Reuters

More than 5 million people have died of Covid-19 in less than two years as the world continues to battle the highly contagious Delta strain of the virus and keep an eye out for new mutations.

According to data collected Monday by John Hopkins University, 5,000,425 Covid-19-related deaths have been recorded worldwide. 745,836 people have died of Covid-19 in the United States, making it the country with the most recorded deaths.

The coronavirus pandemic, which first appeared in China in late 2019, continues to cause deadly consequences worldwide.

It is as a result that many countries are lifting pandemic restrictions and ending lockdowns, which were imposed to varying degrees throughout 2020 in an attempt to stop the virus from spreading.

The rapid development of Covid vaccines, clinically proven to significantly reduce serious infections, hospital stays, and deaths from the coronavirus, has helped dramatically reduce the number of people dying from Covid, especially in western countries where the vaccination programs are at an advanced stage.

Nonetheless, there have been growing concerns in recent months about an increase in infections, hospital admissions, and deaths as winter approaches, not only among the unvaccinated, who are far more at risk of serious complications from Covid, but also among the elderly (who are too vaccinated first), as immunity wears off over time.

This is breaking news, please check back for more updates.

Costco, Nike and FedEx are warning there’s extra inflation set to hit shoppers as holidays method

A worker wearing a protective mask removes

David Paul Morris | Bloomberg | Getty Images

Delivery bottlenecks, which have led to rising freight costs, are a vacation headache for US retailers.

Cost co This week joined the long list of retailers on the alert about rising shipping prices and the associated supply chain problems. The warehouse clerk who a similar cautionary note in MayThe sportswear giant joined her Nike and economic pioneers FedEx and General mills when discussing similar concerns.

The cost of shipping containers overseas has increased in recent months. Getting a 40-foot container from Shanghai to New York cost about $ 2,000 a year and a half ago, just before Covid pandemic. It is now around $ 16,000, according to Bank of America.

In a conference call with analysts Thursday, Richard Galanti, Costco’s chief financial officer, called freight costs “permanent inflationary items” and said these increases are being combined with things that are “somewhat permanent” to add to the pressure. This includes not only freight, but also higher labor costs, increasing transport and product demand as well as scarcity of computer chips, oils and chemicals and higher raw material prices.

“We can’t hold onto all of this,” said Galanti. “Some of it has to be passed on, and it is passed on. We are pragmatic about it.”

To quantify the situation, he said inflation is likely to be between 3.5% and 4.5% for Costco. He noticed that Paper products saw cost increases of 4% to 8% and cited shortages in plastic and pet products that are driving prices up from 5% to 11%.

“We can hold the line on some of these things and do a slightly better job – hopefully a better job than some of our competitors and even more extreme than value,” said Galanti. “So I think all of these things have worked a little in our favor so far, at least despite the challenges.”

Prepare for the holidays

However, the timing is not good.

Persistent inflationary pressures come at a time when retailers prepare for the Christmas shopping season – Halloween, Thanksgiving, and Christmas, then the New Year. The pandemic brought it about a relentless array of factors After a generation of mostly moderate price pressure, this has made inflation an economic catchphrase.

Companies are forced to deal with the situation before a critical phase.

“We’re approaching the holidays, we’ve worked with retailers, and we see that # 1 they need to be flexible with their supply chain,” said Keith Jelinek, executive director of global retail practice at consulting firm Berkeley Research Group. “We noticed an increase in the cost of goods, especially for clothing, including the cost of inbound shipping with the cost of containers, increases in transport, truck transports to get to distribution centers.”

“All of these costs will weigh on operating profit,” he added. “Retailers are currently facing the challenge of how much I can pass on to the consumer, or how I can get other efficiencies out of my operations to meet my overall margin.”

Many companies have signaled that consumers are ready, at least for now, to accept higher prices. Trillions of government incentives during the pandemic helped increase personal wealth Household net worth increased by 4.3% in the second quarter.

In the company’s conference call on Thursday, Nike CFO Matthew Friend referred to the price increases in the second half of the year, as well as “more than expected full price realization” and “additional transportation, logistics and air freight costs to move inventory in this dynamic environment”.

Nobody knows how long consumers will be willing to pay higher prices. Jelinek said he anticipates the current situation will last at least during the holiday season and until early next year

“There is only a limited amount that you can give to consumers,” he said. “What most retailers do is think about theirs [profit and loss statements] and they want to improve performance and optimize efficiency. That means really focusing on your supply chain. “

It also means raising prices.

Corporate warnings

FedEx announced this week that it will add 5.9% to the shipping cost for domestic services and 7.9% for other offers. The company said it was hit by labor shortages and “costs related to the challenging operating environment”.

The head of the company’s main competitor admitted the hurdles the business is facing.

“The job market is tight and in certain parts of the country we have had to make some market price adjustments to respond to market demands.” UPS CEO Carol Tome said on CNBC’s Thursday, “Closing bell. “

She added that the company was also affected by supply chain issues.

“I’m afraid this will continue for a while. These problems have been a long time coming and we must all work together to remove these blockages, ”said Tome.

Federal Reserve officials this week admitted that inflation will be higher in 2021 than they expected. However, you can still see that prices will settle in a more normal range of just over 2% in the years to come.

But Cleveland Fed President Loretta Mester said in a speech on Friday that she saw “upside risks” for the central bank’s inflation projections.

“Many companies report that cost pressures are mounting and consumers are willing to pay higher prices,” she said. “The combination of strong demand and supply chain challenges could last longer than I expected, leading people and businesses to raise their expectations of future inflation more than we have seen before.”

Fed officials said they were ready to withdraw monetary stimulus They provided during the pandemic, but prices are unlikely to increase anytime soon. However, if prices and expectations stay higher, Mester said, Fed policies would have to be “adjusted” to control inflation.

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Inflation, labor and delta variant hit restaurant homeowners, Goldman Sachs information finds

Restaurants across the county have been looking forward to the economy reopening in recent months as Covid vaccines continued to spread and pent-up consumer demand was felt.

But headwinds from supply chain interruptions to labor shortages and rising costs hit the industry as the contagious Delta variant tarnishes hopes of a return to normal.

Small business owners in the food, restaurant and hospitality sectors are more concerned than most about the ongoing disruption of the pandemic, according to new data from Goldman Sachs’ 10,000 Small Business Voices program. The data shows that 84% of owners in these sectors are concerned about the impact of rising Covid-19 infection rates on businesses, compared to 75% of the entire small business population.

Almost all of them saw an increase in operating costs, with 93% believing that inflationary pressures have increased since June, negatively affecting finances.

The data subset of 117 food, restaurant and hospitality owners came from a broader survey of 1,145 participants in the Goldman Sachs 10,000 Small Businesses program earlier this month.

The numbers underscore the continuing pressures restaurants face even in an economy recovering from the worst of the damage caused by the coronavirus. While the introduction of vaccines and looser public health restrictions have brought the industry closer to normal, challenges remain as restaurant owners look to fall.

Ruby Bugarin, who runs Margaritas and Pepe restaurants in the greater Los Angeles area, said both the availability of goods and the higher cost hit her business. Products like crabs are harder to find, the cost of chicken and pork has increased by more than $ 1 a pound, and the prices of other goods have increased.

“In the past two or three weeks, the price of avocados has gone from about $ 40 a box to $ 85 a box. So that’s more than double, ”said Bugarin, a member of the Small Business Voices program. “We can’t do the same to our customers – we raise prices once or twice a year.”

Labor costs are also rising in her two restaurants with a total of 63 employees. Bugarin said she would like to add a chef or two at each location, but instead pays overtime weekly to her current staff.

Restaurant, hospitality and hospitality owners like Bugarin are also more affected by work problems than in the wider small business community. The data shows that 79% of these business owners say the challenges for employees have worsened since the pandemic, compared with 64% overall.

Recent data from the National Federation of Independent Business underscores the labor law issues that weigh on the optimism of small businesses. The vacancies in August were above the historic 48-year average for the second month in a row.

“In June, despite inflation and despite labor challenges, 67% of small businesses said they believed the US is on the right track,” said Joe Wall, national director of Goldman Sachs 10,000 Small Businesses Voices. “That number is now 38%. The delta variant is sure to be the # 1 issue in terms of sentiment change, and then you pile on it, inflation dynamics and the challenges facing the workforce.”

With the pandemic taxing restaurant operators, Goldman’s data shows that nearly 40% of food and hospitality companies say they expect they’ll need to take out a loan or line of credit for their business this fall or winter. This corresponds to 29% of the companies as a whole.

The Small Business Administration recently announced a revision of the Economic Injury Disaster Loan program for businesses. The credit limit will be increased to $ 2 million and recipients will be allowed to use the funds to prepay business debts, which allows restaurants to use the money on business debts and more.

“At a time when small business restaurants still have extreme working capital needs, these changes will improve the prospects for thousands of operators and improve the economic prospects for communities large and small,” said Sean Kennedy, executive vice president of public policy at the National Restaurant Association said in a statement. The group worked with the SBA on the new small business terms.

Beyond these changes, small business and restaurant owners and advocates have urged lawmakers to top up the $ 28.6 billion restaurant revitalization fund. It granted grants to the industry but was quickly exhausted due to high demand.

“We were able to distribute it to over 100,000 companies across the country, but demand was 2.5 times as much,” SBA administrator Isabel Guzman told CNBC about the RRF last month. “There are still restaurants, food and beverage companies that need support. We know they have been hardest hit, and will often be the last to reopen in communities, but they define so many of our main streets.I can’t say exactly what the actions of Congress will be, but the SBA would be ready to take these Manage programs quickly, efficiently and fairly. “

Everton hit again in model to beat Burnley

LIVERPOOL, Sep 13 (Reuters) – Everton struck three times in the second half in seven minutes when they beat Burnley 3-1 and tied on points with Premier League leaders Manchester United at Goodison Park on Monday.

Ben Mee’s header in his 200th Premier League game gave Burnley the lead in the 53rd minute, but Everton’s reaction was strong as the hosts clinched their third league win of the season.

Michael Keane headed Everton’s equalizer in the 59th minute before Andros Townsend scored a sensational left-footed foot to give Everton the lead – his first league goal since his free transfer from Crystal Palace.

Seconds later, Demarai Gray made Everton’s third goal all by himself, to the delight of home fans who hadn’t liked what they’d seen before.

Everton moved up to fourth place with 10 points from four games – tied with Liverpool, Chelsea and United.

Burnley were the better side in the first half but they are still waiting for their first league win of the season and stay in 18th place by one point.

Former Liverpool manager Rafa Benitez’s arrival at Goodison was not universally popular with Everton fans, but they started the season in style, scoring 10 goals in four games.

They suffered a blow before kick-off as striker Dominic Calvert-Lewin was out with a broken toe, and for much of the first half they were second-best against a fueled Burnley.

Chris Wood should have given the visitors an early lead, but was unable to make proper contact with his header after a great ball into the penalty area from Dwight McNeil.

Everton’s only real chance before the break was when Townsend picked the run of Abdoulaye Doucoure, whose first angular strike was well saved by Nick Pope.

It was only after Mee Burnley led the way that Everton came to life and Townsend was the catalyst.

He showed great feet to make room on the right wing before taking a perfect cross for Keane to peek into his header.

Townsend had spent almost a year without a goal in the Premier League but his efforts were worth the wait.

He picked up the ball in a central area and bumped forward before sending a curling that dipped his left foot into the top corner of the net.

“My mom kept sending me compilations of all of my goals, she told me to look at them when I can, and maybe I reminded myself that I can do it and pulled them out,” Townsend said of his efforts .

Doucoure then split Burnley’s defense to clear Gray up and he calmly beat Pope before Doucoure himself denied an offside goal when Everton stood up.

Reporting by Martyn Herman, editing by Pritha Sarkar

Our standards: The Thomson Reuters Trust Principles.

Individuals are wanting to hit the street Labor Day vacation weekend

Large areas such as national parks and beaches are still popular for long vacation weekends.

Thomas Barwick | Stone | Getty Images

A spike in Covid-19 infections due to the Delta variant may slow recovery from the pandemic, but Labor Day travelers looking for a hurray last summer – and with the shadow of possible future bans on their mind – are eager to to be on the way.

Recent studies have shown that this is happening despite ongoing concerns about Covid-19 and related restrictions like mask and vaccination requirements for travel destinations and venues.

Up to that point, 75% of people surveyed by travel website The Vacationer and SurveyMonkey on August 1 said the coronavirus remains a “minor” or “major” problem, according to co-founder Eric Jones. However, Jones said he thinks Labor Day travel is on the rise “because people want to make sure they get something”.

“There is talk of new quarantine rules or bans … so some fear they will not be able to travel again,” added Jones, finding in an earlier poll this summer.

The Vacationer found that 25% of Americans are planning so-called revenge trips. “That means they travel more than usual just because they were bottled at home,” Jones said. “Well, I suspect this is one of the last Labor Day opportunities you have this summer.”

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In fact, The Vacationer’s latest survey found that more than 53% of 571 respondents are planning a work holiday trip, with 4.03% using public transit, 12.08% flying, and 36.95% driving a car. The result – extrapolated to the US population as a whole – would mean that 137 million American adults will travel that weekend, according to the website, an increase from July 4th and more than 10% more than the total number of weekends on Easter and on Memorial Day together.

For its part, Tripadvisor found that only 31% of Americans surveyed plan to travel this weekend, which is in line with 2020 (32%) and even 2019 (35%) levels.

Elizabeth Monahan, senior communications manager and US travel expert on site, said that “this is pretty consistent when it comes to a long weekend.” Tripadvisor found that 86% of travelers will stay in the US, with 45% traveling locally by car or train and 41% using domestic flights. Only 14% plan to travel abroad.

Among the age cohorts, Millennials are the most willing to travel with 38%, followed by Generation X with 32% and Generation Z with 31%. Older Americans are far less inclined to travel this week, with only 13% of baby boomers traveling.

Millennials, who are often thought to be in their 30s and 40s now, are more likely to be parents of children who went to school at home in the last year – perhaps Monahan explains the population’s eagerness to leave the home.

“This group in particular really missed some of the great memories that travel and experience different parts of the world with those who are closest to you can make,” she said.

It’s not just surveys that show an increasing interest in Labor Day travel, but also in hard sales data. TripIt, from Concur’s data analysis, showed domestic flight, car rentals, accommodations and vacation rentals bookings were 53%, 75%, 62% and 46% respectively, compared to Labor Day 2019 only 33% of 2019 levels; Bookings from car rental companies and accommodation have also increased significantly since the end of May.

Jen Moyse, TripIt’s senior director of product, said the analytical results were not a “big surprise”.

“What we’ve seen in our previous studies is that people are more comfortable traveling and that is reflected in the bookings,” she said. “As soon as the vaccines came out, we saw the level of comfort increase.”

In terms of spending, 39.4% of respondents said they wouldn’t spend cash on travel this weekend, The Vacationer found. But of those who take a trip, the majority of travelers are spending less than $ 500 at 37.13%, while 12.08% will spend $ 501 to $ 1,000, according to The Vacationer’s survey. Meanwhile, about 11.38% will spend $ 1,001 or more. That means almost one in four adults will be spending more than $ 500 this weekend.

TripIt found that travelers stay longer, with accommodation reservations increasing by a factor of 10 since 2019 for both 8-13 day trips and trips longer than 14 days. Moyse also attributes this to business travelers who just want to stay away longer when they decide to travel. “When I get out, I’ll travel as I mean,” she said.

The more flexibility the various hospitality sectors can offer guests, the more businesses these providers will win.

Elizabeth Monahan

Senior Communications Manager at Tripadvisor

According to Tripadvisor, flexibility remains important for travelers; Filters like Free Cancellation, Pay at Stay, and Travel Safe are some of the most clicked filters on the page.

“The biggest benefit people are looking for is cleanliness, but flexibility is also a priority right now,” said Monahan. “The more flexibility the various hospitality sectors can offer guests, the more business these providers will win.”

Later that year they also booked weekend Labor Day flights, with TripIt seeing 51% of reservations in July, compared to just 18% in 2020. Tripadvisor has also seen a trend towards last minute bookings. The website found that 70% of trips booked in the first week of August were for trips within three weeks.

TripIt’s Moyse attributed this behavior to people knowing that conditions change day by day.

“Some of this has to do with looking at the current conditions and thinking, ‘Am I ready to go? What will it be like in this destination?'” Moyse said, citing Hawaii, which eased entry restrictions in July just got to tighten them again.

No escape from Covid

EMS FORSTER PRODUCTIONS | DigitalVision | Getty Images

Three in four of The Vacationer’s respondents said Covid-19 was a “slight” or “big” problem for Labor Day. Almost half fear that they (46.06%) or a family member or friend (46.76%) could get Covid, and 37.83% fear that they could unwittingly spread it. Mask (28.55%) and test or vaccine requirements (20.32%) were also of concern, regardless of whether respondents were for or against such mandates. Only 16.99% had no concerns at all.

Moyse at TripIt said, “There’s still some nervousness there [and] they are still cautious. “

However, this may be due to the surprising rise of the delta variant. “Once the Delta variant has been with us for a while, it’s possible we will see other responses from people,” she added.

“But right now, people are learning how to mask, they’re learning to take precautions, they’re learning to plan ahead, and that’s some of the advice we’ve given a lot,” added Moyse. “Think about how you can plan your trip a little differently than in 2019.”

Top 15 Labor Day Destinations on Tripadvisor for 2021

  1. Ocean City, Maryland
  2. Orlando Florida
  3. Las Vegas
  4. Myrtle Beach, South Carolina
  5. new York
  6. Cancun, Mexico
  7. Virginia Beach, Virginia
  8. Miami Beach, Florida
  9. Key West, Florida
  10. Honolulu
  11. Panama City Beach, Florida
  12. Atlantic City, New Jersey
  13. Gatlinburg, Tennessee
  14. Chicago
  15. Pigeon Forge, Tennessee

Source: Tripadvisor

In fact, Tripadvisor found that beaches and national parks – mostly outdoor areas that became popular amid pandemic lockdowns last year – remain the most sought-after attractions in August.

“When people want to get out and travel, they want to be sure to do so in places like the outdoors or on beaches or while hiking – we’re even seeing a lot of interest in camping,” Monahan said. “Places where you can enjoy beautiful views but also practice social distancing have remained a really strong trend, and we’re now seeing that for Labor Day weekend as well.”

The trend is reflected in how Tripadvisor’s top Labor Day travel destinations compare to those in 2019, when more urban spots were popular. This year, Ocean City, Maryland ranked first, pushing former No. 1 destination Las Vegas to third, and 10 of the top 15 travel destinations are warm weather or seaside destinations. Two years ago, on the other hand, 10 out of 15 top positions were large cities.

That said, don’t expect the city to stay out forever.

“We’re seeing some places like New York and even Chicago popping up again,” Monahan said.

The Big Apple, # 2 in 2019, held its fifth place this year, and the Windy City, once the sixth most popular, retains some attraction at 14th place.